S.D. Admin. R. 20:06:08:60

Current through Register Vol. 51, page 67, December 16, 2024

Section 20:06:08:60 - Duties of replacing insurers using producers

Where a replacement is involved in the transaction, the replacing insurer shall:

(1) Verify the required forms are received and are in compliance with §§ 20:06:08:49 to 20:06:08:65, inclusive;

(2) Notify any other existing insurer that may be affected by the proposed replacement within five business days of receipt of a completed application indicating replacement or when the replacement is identified if not indicated on the application. The replacing insurer must mail a copy of the available illustration or policy summary for the proposed policy or available disclosure document for the proposed contract within five business days of a request from an existing insurer:

(3) Be able to produce copies of the notification regarding replacement required in § 20:06:08:50, indexed by producer, for at least five years or until the next regular examination by the insurance department of a company's state of domicile, whichever is later; and

(4) Provide to the policy or contract owner notice of the right to return the policy or contract within 30 days of the delivery of the contract and receive an unconditional full refund of all premiums or considerations paid on it, including any policy fees or charges or, in the case of a variable or market value adjustment policy or contract, a payment of the cash surrender value provided under the policy or contract plus the fees and other charges deducted from the gross premiums or considerations or imposed under such policy or contract; such notice may be included in Appendix D or F.

In transactions where the replacing insurer and the existing insurer are the same or subsidiaries or affiliates under common ownership or control, allow credit for the period of time that has elapsed under the replaced policy's or contract's incontestability and suicide period up to the face amount of the existing policy or contract. With regard to financed purchases, the credit may be limited to the amount the face amount of the existing policy is reduced by the use of existing policy values to fund the new policy or contract.

S.D. Admin. R. 20:06:08:60

39 SDR 55, effective 10/4/2012.

General Authority: SDCL 58-33A-7(10).

Law Implemented: SDCL 58-33-5, 58-33-6, 58-33-7, 58-33-8, 58-33A-1, 58-33A-2.