Florida Regulations 69K-10.002: Disbursement from the Preneed Funeral Contract Consumer Protection Trust Fund
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The purpose of the Preneed Contract Consumer Protection Trust Fund is to provide restitution to preneed contract purchasers and their estates due to a preneed licensee’s or otherwise covered provider’s failure to provide the benefits of a preneed contract or failure to refund the appropriate principal amount by reason of cancellation thereof. All restitution to be paid from the Preneed Funeral Contract Consumer Protection Trust Fund shall be subject to review and approval of the Board. Amounts disbursed from the Preneed Funeral Contract Consumer Protection Trust Fund shall be determined in accordance with the following criteria:
(1) The Board shall determine to its satisfaction that the preneed licensee or otherwise covered provider does not possess the financial means to deliver or provide the prearranged merchandise or services. Such determination will be based on information the Board will require for review and may include the following if applicable:
(a) Review of delinquency proceedings pursuant to chapter 631, F.S., against a preneed licensee or otherwise covered provider;
(b) Review of bankruptcy proceedings in Federal court;
(c) Review of Trust Accounts held by or entered into by the preneed licensee or otherwise covered provider;
(d) Review of any funding source used for the preneed contracts;
(e) Review of all assets held by the preneed licensee or otherwise covered provider;
(2) Requests for restitution shall be submitted on the Preneed Funeral Contract Consumer Protection Trust Fund Proof of Claim and Disbursement Request form, DFS-TFD-1, which is incorporated by reference in Fl. Admin. Code R. 69K-1.001, and available from the Department of Financial Services, Division of Funeral, Cemetery, and Consumer Services, 200 East Gaines Street, Tallahassee, Florida 32399-0361. Restitution will only be made if the preneed licensee or otherwise covered provider was licensed as a preneed licensee or was regulated under chapter 470, F.S., when the contract was written. All requests for restitution from the Preneed Funeral Contract Consumer Protection Trust Fund shall be accompanied by a copy of the preneed contract and documentation which verifies the total funds paid on preneed contract, and that the applicant has not defaulted in the terms of the contract. In addition, documentation that the preneed licensee or otherwise covered provider has failed to provide the benefits of the preneed contract or has failed to refund the appropriate principal amount by reason of cancellation.
(3) The Board and Department shall have the right to review, investigate, or request additional documentation from any person regarding any request for restitution, in order to determine the validity and correct amount of restitution, if any, to be made.
(4) Restitution may only be obtained from the Preneed Funeral Contract Consumer Protection Trust Fund if adequate funds are not available in the preneed licensee’s or otherwise covered provider’s preneed trust fund or in the possession of the preneed licensee or otherwise covered provider.
(5) As used herein the term “”Restitution”” means the disbursement of funds to a preneed licensee or other entity that is licensed by state law to provide services at-need from the Preneed Funeral Contract Consumer Protection Trust Fund after fulfillment of a previously breached contract. After fulfillment, interest accrued in a merchandise trust account or any similar account shall be transferred with the principal to the fulfilling preneed licensee or provider.
(6) If a preneed licensee or provider has been assigned a breached contract by the purchaser, owner or beneficiary and is willing to completely fulfill the breached contract, an application for disbursement of funds to the purchaser, owner or beneficiary of a breached contract will not be considered by the Board. In addition, a purchaser, owner or beneficiary of a breached contract that would otherwise form the basis of a claim for restitution who cancels the contract and receives funds from a trustee will not be considered for restitution from the Preneed Funeral Contract Consumer Protection Trust Fund.
(7) Notwithstanding the provisions of subsection (5) or (6), direct monetary disbursements of funds from the Preneed Funeral Contract Consumer Protection Trust fund will be made directly to the purchaser, owner or beneficiary if both of the following conditions exist:
(a) Funds up to the amount paid on the breached contract do not exist in trust or one of the alternatives to trust as outlined in sections 497.458, 497.462 and 497.464, F.S., so long as the purchaser, owner or beneficiary has not received funds from the trustee, and
(b) A preneed licensee or otherwise covered provider that will fulfill the breached contract for the identical services and merchandise is not available. Direct monetary disbursement of funds from the Preneed Funeral Contract Consumer Protection Trust Fund will also be made to the purchaser, owner or beneficiary if a provider breaches the original contract and the consumer is forced to purchase another contract. In this case, restitution will be made after fulfillment of the secondary contract for up to the amount paid on the original contract purchases less money trusted.
(8) Nothing in this rule shall be construed to apply to insurance policies sold to fund preneed contracts or to permit payment of a request for restitution from the Preneed Funeral Contract Consumer Protection Trust Fund where the preneed contract was funded by a life insurance policy prior to July 1, 1996. The Department shall, at all times, retain jurisdiction in determining whether a contract purchased constitutes a preneed contract as defined by chapter 497, F.S., or a prearranged burial plan funded by an insurance policy.
Rulemaking Authority 497.103, 497.456 FS. Law Implemented Florida Statutes § 497.456. History-New 5-23-94, Amended 12-4-95, 10-18-99, 6-21-01, Formerly 3F-10.002, Amended 3-7-16.
Terms Used In Florida Regulations 69K-10.002
- Assets: (1) The property comprising the estate of a deceased person, or (2) the property in a trust account.
- Bankruptcy: Refers to statutes and judicial proceedings involving persons or businesses that cannot pay their debts and seek the assistance of the court in getting a fresh start. Under the protection of the bankruptcy court, debtors may discharge their debts, perhaps by paying a portion of each debt. Bankruptcy judges preside over these proceedings.
- Beneficiary: A person who is entitled to receive the benefits or proceeds of a will, trust, insurance policy, retirement plan, annuity, or other contract. Source: OCC
- Contract: A legal written agreement that becomes binding when signed.
- Jurisdiction: (1) The legal authority of a court to hear and decide a case. Concurrent jurisdiction exists when two courts have simultaneous responsibility for the same case. (2) The geographic area over which the court has authority to decide cases.
- Restitution: The court-ordered payment of money by the defendant to the victim for damages caused by the criminal action.
- Trust account: A general term that covers all types of accounts in a trust department, such as estates, guardianships, and agencies. Source: OCC
- Trustee: A person or institution holding and administering property in trust.
(a) Review of delinquency proceedings pursuant to chapter 631, F.S., against a preneed licensee or otherwise covered provider;
(b) Review of bankruptcy proceedings in Federal court;
(c) Review of Trust Accounts held by or entered into by the preneed licensee or otherwise covered provider;
(d) Review of any funding source used for the preneed contracts;
(e) Review of all assets held by the preneed licensee or otherwise covered provider;
(2) Requests for restitution shall be submitted on the Preneed Funeral Contract Consumer Protection Trust Fund Proof of Claim and Disbursement Request form, DFS-TFD-1, which is incorporated by reference in Fl. Admin. Code R. 69K-1.001, and available from the Department of Financial Services, Division of Funeral, Cemetery, and Consumer Services, 200 East Gaines Street, Tallahassee, Florida 32399-0361. Restitution will only be made if the preneed licensee or otherwise covered provider was licensed as a preneed licensee or was regulated under chapter 470, F.S., when the contract was written. All requests for restitution from the Preneed Funeral Contract Consumer Protection Trust Fund shall be accompanied by a copy of the preneed contract and documentation which verifies the total funds paid on preneed contract, and that the applicant has not defaulted in the terms of the contract. In addition, documentation that the preneed licensee or otherwise covered provider has failed to provide the benefits of the preneed contract or has failed to refund the appropriate principal amount by reason of cancellation.
(3) The Board and Department shall have the right to review, investigate, or request additional documentation from any person regarding any request for restitution, in order to determine the validity and correct amount of restitution, if any, to be made.
(4) Restitution may only be obtained from the Preneed Funeral Contract Consumer Protection Trust Fund if adequate funds are not available in the preneed licensee’s or otherwise covered provider’s preneed trust fund or in the possession of the preneed licensee or otherwise covered provider.
(5) As used herein the term “”Restitution”” means the disbursement of funds to a preneed licensee or other entity that is licensed by state law to provide services at-need from the Preneed Funeral Contract Consumer Protection Trust Fund after fulfillment of a previously breached contract. After fulfillment, interest accrued in a merchandise trust account or any similar account shall be transferred with the principal to the fulfilling preneed licensee or provider.
(6) If a preneed licensee or provider has been assigned a breached contract by the purchaser, owner or beneficiary and is willing to completely fulfill the breached contract, an application for disbursement of funds to the purchaser, owner or beneficiary of a breached contract will not be considered by the Board. In addition, a purchaser, owner or beneficiary of a breached contract that would otherwise form the basis of a claim for restitution who cancels the contract and receives funds from a trustee will not be considered for restitution from the Preneed Funeral Contract Consumer Protection Trust Fund.
(7) Notwithstanding the provisions of subsection (5) or (6), direct monetary disbursements of funds from the Preneed Funeral Contract Consumer Protection Trust fund will be made directly to the purchaser, owner or beneficiary if both of the following conditions exist:
(a) Funds up to the amount paid on the breached contract do not exist in trust or one of the alternatives to trust as outlined in sections 497.458, 497.462 and 497.464, F.S., so long as the purchaser, owner or beneficiary has not received funds from the trustee, and
(b) A preneed licensee or otherwise covered provider that will fulfill the breached contract for the identical services and merchandise is not available. Direct monetary disbursement of funds from the Preneed Funeral Contract Consumer Protection Trust Fund will also be made to the purchaser, owner or beneficiary if a provider breaches the original contract and the consumer is forced to purchase another contract. In this case, restitution will be made after fulfillment of the secondary contract for up to the amount paid on the original contract purchases less money trusted.
(8) Nothing in this rule shall be construed to apply to insurance policies sold to fund preneed contracts or to permit payment of a request for restitution from the Preneed Funeral Contract Consumer Protection Trust Fund where the preneed contract was funded by a life insurance policy prior to July 1, 1996. The Department shall, at all times, retain jurisdiction in determining whether a contract purchased constitutes a preneed contract as defined by chapter 497, F.S., or a prearranged burial plan funded by an insurance policy.
Rulemaking Authority 497.103, 497.456 FS. Law Implemented Florida Statutes § 497.456. History-New 5-23-94, Amended 12-4-95, 10-18-99, 6-21-01, Formerly 3F-10.002, Amended 3-7-16.