| 1 | 1 | | By: Hinojosa, et al. S.B. No. 1168 |
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| 2 | 2 | | Substitute the following for S.B. No. 1168: |
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| 3 | 3 | | By: Smithee C.S.S.B. No. 1168 |
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| 4 | 4 | | |
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| 5 | 5 | | |
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| 6 | 6 | | A BILL TO BE ENTITLED |
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| 7 | 7 | | AN ACT |
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| 8 | 8 | | relating to a rescission period for annuity contracts. |
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| 9 | 9 | | BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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| 10 | 10 | | SECTION 1. Subtitle A, Title 7, Insurance Code, is amended |
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| 11 | 11 | | by adding Chapter 1116 to read as follows: |
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| 12 | 12 | | CHAPTER 1116. REQUIRED PROVISIONS FOR ANNUITY CONTRACT |
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| 13 | 13 | | Sec. 1116.001. DEFINITION. In this chapter, "annuity" |
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| 14 | 14 | | means a fixed, variable, or modified guaranteed annuity that is |
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| 15 | 15 | | individually solicited, whether classified as an individual |
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| 16 | 16 | | annuity or group annuity. |
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| 17 | 17 | | Sec. 1116.002. RESCISSION PERIOD REQUIRED. An annuity |
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| 18 | 18 | | contract must provide: |
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| 19 | 19 | | (1) An unconditional refund of premiums paid for a |
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| 20 | 20 | | fixed annuity contract, including any contract fees or charges, |
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| 21 | 21 | | within 20 days of the delivery of the contract; and |
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| 22 | 22 | | (3) An unconditional refund for variable or modified |
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| 23 | 23 | | guaranteed annuity contracts within 20 days of the delivery of the |
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| 24 | 24 | | contract. The unconditional refund shall be equal to the cash |
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| 25 | 25 | | surrender value provided in the annuity contract, plus any fees or |
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| 26 | 26 | | charges deducted from the premiums or imposed under the contract. |
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| 27 | 27 | | This subparagraph does not apply if the prospective owner is an |
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| 28 | 28 | | accredited investor, as defined in Regulation D as adopted by the |
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| 29 | 29 | | United States Securities and Exchange Commission. |
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| 30 | 30 | | SECTION 2. The change in law made by this Act applies only |
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| 31 | 31 | | to an annuity contract delivered or issued for delivery on or after |
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| 32 | 32 | | January 1, 2010. A contract delivered or issued for delivery before |
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| 33 | 33 | | January 1, 2010, is governed by the law in effect immediately before |
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| 34 | 34 | | the effective date of this Act, and that law is continued in effect |
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| 35 | 35 | | for that purpose. |
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| 36 | 36 | | SECTION 3. This Act takes effect September 1, 2009. |
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