Section 40. Duties of agents

A. An agent who initiates an application shall submit to the insurer, with or as part of the application, a statement signed by both the applicant and the agent as to whether the applicant has existing policies or contracts. If no policies or contracts are indicated, the agent's duties with respect to replacement are complete.

B. If policies or contracts are listed indicating existing coverage referred to in subsection A of this section, the agent shall present and read to the applicant, not later than at the time of taking the application, a notice regarding replacements (Form 30-A) or other substantially similar form approved by the commission. However, no approval shall be required when amendments to the notice are limited to the omission of references not applicable to the product being sold or replaced. The notice shall be signed by both the applicant and the agent, attesting that the notice has been read aloud by the agent or that the applicant did not wish the notice to be read aloud (in which case the agent need not have read the notice aloud). The notice shall be left with the applicant.

C. The notice shall list all life insurance policies or annuities proposed to be replaced, properly identified by name of insurer, the insured or annuitant, and policy or contract number if available; and shall include a statement as to whether each policy or contract will be replaced or whether a policy will be used as a source of financing for the new policy or contract. If a policy or contract number has not been issued by the existing insurer, alternative identification, such as an application or receipt number, shall be listed.

D. In connection with a replacement transaction, the agent shall leave with the applicant, at the time an application for a new policy or contract is completed, the original or a copy of all marketing communications. Electronically presented marketing communications shall be provided to the policy or contract owner in printed form no later than at the time of policy or contract delivery.

E. Except as provided in 14VAC5-30-51 C, in connection with a replacement transaction, the agent shall submit to the insurer to which an application for a policy or contract is presented, a copy of each document required by this section, a statement identifying any preprinted or electronically presented company-approved marketing communications used, and copies of any individualized marketing communications, including any illustrations related to the specific policy or contract purchased.

Historical Notes

Derived from Regulation No. 7, Case No. INS810114, Section V, eff. March 1, 1982; amended, Volume 23, Issue 09, eff. April 1, 2007.

Statutory Authority

§§ 12.1-13 and 38.2-223 of the Code of Virginia.