By: Hinojosa, et al. S.B. No. 1168
Substitute the following for S.B. No. 1168:
By: Smithee C.S.S.B. No. 1168
A BILL TO BE ENTITLED
AN ACT
relating to a rescission period for annuity contracts.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Subtitle A, Title 7, Insurance Code, is amended
by adding Chapter 1116 to read as follows:
CHAPTER 1116. REQUIRED PROVISIONS FOR ANNUITY CONTRACT
Sec. 1116.001. DEFINITION. In this chapter, "annuity"
means a fixed, variable, or modified guaranteed annuity that is
individually solicited, whether classified as an individual
annuity or group annuity.
Sec. 1116.002. RESCISSION PERIOD REQUIRED. An annuity
contract must provide:
(1) An unconditional refund of premiums paid for a
fixed annuity contract, including any contract fees or charges,
within 20 days of the delivery of the contract; and
(3) An unconditional refund for variable or modified
guaranteed annuity contracts within 20 days of the delivery of the
contract. The unconditional refund shall be equal to the cash
surrender value provided in the annuity contract, plus any fees or
charges deducted from the premiums or imposed under the contract.
This subparagraph does not apply if the prospective owner is an
accredited investor, as defined in Regulation D as adopted by the
United States Securities and Exchange Commission.
SECTION 2. The change in law made by this Act applies only
to an annuity contract delivered or issued for delivery on or after
January 1, 2010. A contract delivered or issued for delivery before
January 1, 2010, is governed by the law in effect immediately before
the effective date of this Act, and that law is continued in effect
for that purpose.
SECTION 3. This Act takes effect September 1, 2009.