Virginia Code 38.2-3100.3: Requirements of life insurance or annuity contracts used to fund preneed funeral contracts
A. For purposes of this section, “preneed funeral contract” means any agreement where payment is made by the insured prior to the receipt of services or supplies contracted for, which evidences arrangements prior to death for (i) the providing of funeral services or (ii) the sale of funeral supplies.
Terms Used In Virginia Code 38.2-3100.3
- Annuity: A periodic (usually annual) payment of a fixed sum of money for either the life of the recipient or for a fixed number of years. A series of payments under a contract from an insurance company, a trust company, or an individual. Annuity payments are made at regular intervals over a period of more than one full year.
- annuity: shall be deemed to include "variable annuity" and "modified guaranteed annuity" and shall be deemed to include a contract under which a lump sum cash settlement is an alternative to the option of periodic payments. See Virginia Code 38.2-106
- Commission: means the State Corporation Commission. See Virginia Code 38.2-100
- Contract: A legal written agreement that becomes binding when signed.
- insurance policies: shall include contracts of fidelity, indemnity, guaranty and suretyship. See Virginia Code 38.2-100
- Insurer: means an insurance company. See Virginia Code 38.2-100
- Life insurance: includes policies that also provide (i) endowment benefits; (ii) additional benefits incidental to a loss in the event of death, dismemberment, or loss by accident or accidental means; (iii) additional benefits to safeguard the contract from lapse or to provide a special surrender value, a special benefit or an annuity, in the event of total and permanent disability of the insured; and (iv) optional modes of settlement of proceeds. See Virginia Code 38.2-102
B. Each individual and group life insurance policy issued or issued for delivery in Virginia, each individual and group annuity contract issued or issued for delivery in Virginia, and each certificate issued in connection with a group life insurance policy or group annuity contract issued or issued for delivery in Virginia shall include a provision specifying the means by which face amount adjustments will be made and benefits payable upon death will be adjusted when such a policy or contract will be used to fund a preneed funeral contract.
C. Each insurer proposing to issue individual or group life insurance policies or individual or group annuity contracts in Virginia for purposes of funding preneed funeral contracts shall clearly disclose the intended purpose and market for such policies and contracts when submitting the forms with the Commission for approval, in accordance with § 38.2-316.