2-15 Laws & Rules

Duties of the replacing insurance company

Require from the producer a list of the applicant's life insurance or annuity contracts to be replaced and a copy of the replacement notice provided to the applicant. Send each existing insurance company a written communication advising of the proposed replacement within a specified period of time of the date that the application is received in the replacing insurance company's home or regional office. A policy summary or ledger statement containing policy data on the proposed life insurance or annuity must be included.

certificate

Instead of a policy, the participants under a group plan are issued certificates of insurance as evidence that they have coverage. The certificate must contain the following information: * Group policy number * Description of insurance protection to which the certificate-holder is entitled; * The name of the insured, beneficiaries and dependents (if any); * The rights and conditions.

Agents

the law requires agents to maintain records of transactions for 3 years if the transaction pertains to premium payments.

Duties of the producer:

* Present to the applicant a Notice Regarding Replacement that is signed by both the applicant and the producer, and a copy must be left with the applicant. * Obtain a list of all existing life insurance and/or annuity policies to be replaced including policy numbers and the names of all companies being replaced. * Leave the applicant with the original or a copy of written or printed communications used for presentation to the applicant. * Submit to the replacing insurance company, with the application, a copy of the replacement notice.

Florida Replacement Rule

. This rule sets forth the requirements and procedures to be followed by insurance companies and agents when making such a proposal. The replacement of contracts of life insurance with a new contract requires the agent to give the applicant a written comparison and summary statement at the request of the policyholder and to follow instructions regarding replacement as obtained from the appointing insurer

Eligibility

Participants are given a period of time, known as the eligibility period, to join the group plan. Other plans use an open enrollment period, in which case all new employees must wait until the next enrollment period before joining the group plan. Those who do not enroll at the first opportunity can be required to show evidence of insurability.

Agent Responsibilities

The Code of Ethics of the Florida Association of Insurance and Financial Advisors establishes a broad outline defining appropriate and inappropriate business behavior for life insurance agents. It also establishes the activities of agents as one of public trust.

Agent Responsibilities

The Florida Life Insurance Solicitation Law spells out the information and procedures required of agents and insurers when proposing life insurance to a prospective buyer;

Agent Responsibilities

The Florida Replacement Rule sets forth the requirements and procedures to be followed by insurance companies and agents when a proposal is being made in which a prospective life insurance buyer will be replacing existing insurance contracts with the proposed new insurance

Replacement

Lapsed, forfeited, surrendered, or otherwise terminated. *Reissued with any reduction in cash value. * Converted to reduced paid-up insurance, continued as extended term insurance or otherwise reduced in value by the use of nonforfeiture benefits or other policy values. * Amended so as to affect either a reduction in benefits or in the term for which coverage would otherwise remain in force or for which benefits would be paid. * Pledged as collateral or subjected to borrowing, whether in a single loan or under a schedule of borrowing over a period of time for amounts in the aggregate exceeding 25% of the loan value set forth in the policy. Used in a financed purchase.

A buyer's guide

provides basic information about an insurance policy. This document explains how a buyer should go about choosing the amount and type of insurance to buy, and how a buyer can save money by comparing the cost of similar policies. The insurer must provide a buyer's guide along with a policy summary to any prospective purchaser before accepting the applicant's initial premium or upon the applicant's request.