Second Regular Session
Seventy-third General Assembly
STATE OF COLORADO
INTRODUCED
LLS NO. 22-0324.01 Yelana Love x2295
HOUSE BILL 22-1228
House Committees Senate Committees
Judiciary
A BILL FOR AN ACT
C
ONCERNING THE CONTINUATION OF THE REGULATION OF PRENEED101
FUNERAL CONTRACTS , AND, IN CONNECTION THEREWITH ,102
IMPLEMENTING THE RECOMMENDAT IONS CONTAINED IN THE103
2021
SUNSET REPORT BY THE DEPARTMENT OF REGULATORY104
AGENCIES.105
Bill Summary
(Note: This summary applies to this bill as introduced and does
not reflect any amendments that may be subsequently adopted. If this bill
passes third reading in the house of introduction, a bill summary that
applies to the reengrossed version of this bill will be available at
http://leg.colorado.gov/
.)
Sunset Process - House Judiciary Committee. The bill
implements the recommendations of the department of regulatory
HOUSE SPONSORSHIP
Roberts and Bockenfeld,
SENATE SPONSORSHIP
(None),
Shading denotes HOUSE amendment. Double underlining denotes SENATE amendment.
Capital letters or bold & italic numbers indicate new material to be added to existing statute.
Dashes through the words indicate deletions from existing statute. agencies, as contained in the department's sunset review of preneed
funeral contracts, as follows:
! Continues the regulation of preneed funeral contracts for 7
years, to September 1, 2029;
! Removes from statute the surety bond or net worth
requirements for an applicant for a license to sell preneed
funeral contracts and requires the commissioner of
insurance (commissioner) to establish the requirements in
rule;
! Allows the commissioner to investigate the books, records,
and accounts of a contract seller without the requirement
that the commissioner receive a complaint or indication of
noncompliance;
! Removes the fees for license renewal from statute and
requires the commissioner to establish the fees in rule
based on the cost of regulating the industry and the
outstanding preneed contract obligations of the contract
sellers;
! Requires money held in trust for a preneed contract that is
unclaimed after a reasonable amount of time to be reported
to the state treasurer for deposit into the unclaimed property
trust fund; and
! Requires each funeral establishment, at the time of
registration renewal, to attest to whether the funeral
establishment sells preneed contracts and requires the
director of the division of professions and occupations to
enter into a memorandum of understanding with the
commissioner to share information on funeral
establishments that sell preneed contracts.
Be it enacted by the General Assembly of the State of Colorado:1
SECTION 1. In Colorado Revised Statutes, 24-34-104, repeal2
(23)(a)(X); and add (30)(a)(VII) as follows:3
24-34-104. General assembly review of regulatory agencies4
and functions for repeal, continuation, or reestablishment - legislative5
declaration - repeal. (23) (a) The following agencies, functions, or both,6
are scheduled for repeal on September 1, 2022:7
(X) The regulation of preneed funeral contracts in accordance
8
HB22-1228-2- with article 15 of title 10;1
(30) (a) The following agencies, functions, or both, are scheduled2
for repeal on September 1, 2029:3
(VII) T
HE REGULATION OF PRENEED FUNERAL CONTRACTS IN4
ACCORDANCE WITH ARTICLE 15 OF TITLE 10.5
SECTION 2. In Colorado Revised Statutes, amend 10-15-123 as6
follows:7
10-15-123. Repeal of article. This article 15 is repealed, effective8
September 1, 2022
SEPTEMBER 1, 2029. Before its THE repeal, the9
department of regulatory agencies shall review the regulation of preneed10
funeral contracts in accordance with section 24-34-104.11
SECTION 3. In Colorado Revised Statutes, 10-15-103, amend12
(1)(a), (4)(a), and (5)(b) as follows:13
10-15-103. License procedure - records - examination of14
records - definition - rules. (1) (a) A contract seller shall not enter into15
a preneed contract or accept any funds or other consideration without a16
license from the commissioner. To be valid, an application for an initial17
license must be in writing, signed by the applicant, and duly verified on18
forms furnished by the commissioner. Each application must be19
accompanied by payment of five hundred dollars and either: PROOF OF20
EITHER THE NET WORTH OR SURETY BOND REQUIREMENTS ESTABLISHED21
BY THE COMMISSIONER BY RULE.22
(I) A current balance sheet, income statement, and statement of23
cash flow to demonstrate that the business has a net worth of at least ten24
thousand dollars, signed by a certified public accountant ("CPA"), or, if25
prepared by the applicant or public accountant, accompanied by a current26
tax return; or27
HB22-1228
-3- (II) A surety bond of at least ten thousand dollars to honor1
preneed contract obligations.2
(4) (a) The commissioner may investigate the books, records, and3
accounts of a contract seller to ensure that trust funds, preneed contracts,4
and preneed insurance policies comply with this article ARTICLE 15. The5
commissioner, or a qualified person designated by the commissioner, may6
examine the books, records, and accounts of the contract seller as often7
as necessary upon receiving a complaint or indication of noncompliance8
and may require the attendance of and examine under oath all persons9
whose testimony the commissioner needs for this purpose.10
(5) (b) T
HE COMMISSIONER SHALL ESTABLISH the annual renewal11
fee shall be based upon the aggregate preneed contract price of all
12
preneed contracts outstanding at the end of each calendar year. If the13
aggregate preneed contract price is: BY RULE BASED ON THE COST OF14
REGULATING THE INDUSTRY AND THE OUTSTANDING PRENEED CONTRACT15
OBLIGATIONS OF THE CONTRACT SELLERS .16
(I) One hundred thousand dollars or less, the annual renewal fee17
shall be one hundred dollars;18
(II) Greater than one hundred thousand dollars but not exceeding19
five hundred thousand dollars, the annual renewal fee shall be two20
hundred dollars;21
(III) Greater than five hundred thousand dollars but not exceeding22
one million dollars, the annual renewal fee shall be five hundred dollars;23
(IV) Greater than one million dollars but not exceeding five24
million dollars, the annual renewal fee shall be one thousand dollars;25
(V) Greater than five million dollars but not exceeding ten million26
dollars, the annual renewal fee shall be one thousand five hundred27
HB22-1228
-4- dollars;1
(VI) In excess of ten million dollars, the annual renewal fee shall2
be two thousand dollars.3
SECTION 4. In Colorado Revised Statutes, add 10-15-111.7 as4
follows:5
10-15-111.7. Disposition of unclaimed preneed contracts -6
unclaimed property trust fund - rules. E
ACH CONTRACT SELLER SHALL7
REQUIRE A TRUSTEE WITH WHOM PRENEED CONTRACT FUNDS HAVE BEEN8
DEPOSITED FOR A PRENEED CONTRACT THAT IS UNCLAIMED AFTER A9
REASONABLE AMOUNT OF TIME , AS DETERMINED BY THE COMMISSIONER10
BY RULE, TO REPORT TO THE STATE TREASURER AS PROVIDED IN SECTION11
38-13-401.
THE TRUSTEE SHALL COMPLY WITH THE REQUIREMENTS OF THE12
"R
EVISED UNIFORM UNCLAIMED PROPERTY ACT", ARTICLE 13 OF TITLE13
38,
FOR DEPOSIT OF THE UNCLAIMED CONTRACT FUNDS INTO THE14
UNCLAIMED PROPERTY TRUST FUND , CREATED IN SECTION 38-13-80115
(1)(a).16
SECTION 5. In Colorado Revised Statutes, 12-135-110, amend17
(2)(b) as follows:18
12-135-110. Registration required. (2) (b) Each funeral19
establishment registration shall be renewed, according to a schedule20
established by the director in accordance with section 12-20-202 (1), in21
a form as determined by the director. A
T THE TIME OF RENEWAL, EACH22
FUNERAL ESTABLISHMENT SHALL ATTEST TO WHETHER THE FUNERAL23
ESTABLISHMENT SELLS PRENEED CONTRACTS . THE DIRECTOR SHALL ENTER24
INTO A MEMORANDUM OF UNDERSTANDING WITH THE COMMISSIONER OF25
INSURANCE TO SHARE INFORMATION REGARDING FUNERAL26
ESTABLISHMENTS THAT SELL PRENEED CONTRACTS .27
HB22-1228
-5- SECTION 6. Act subject to petition - effective date. This act1
takes effect at 12:01 a.m. on the day following the expiration of the2
ninety-day period after final adjournment of the general assembly; except3
that, if a referendum petition is filed pursuant to section 1 (3) of article V4
of the state constitution against this act or an item, section, or part of this5
act within such period, then the act, item, section, or part will not take6
effect unless approved by the people at the general election to be held in7
November 2022 and, in such case, will take effect on the date of the8
official declaration of the vote thereon by the governor.9
HB22-1228
-6-