Ala. Admin. Code r. 482-3-004-.04

Current through Register Vol. 43, No. 02, November 27, 2024

Section 482-3-004-.04 - Funeral Merchandise And Services Trust - Deposits

(1) Any person who is paid, collects or receives funds under a preneed contract for funeral merchandise and services to be funded by trust shall timely deposit in trust an amount determined as follows:

(a) 75% of the amount collected on the purchase price for all funeral services and funeral merchandise sold, transportation and facilities rented, other than outer burial containers.

(b) 60% of the amount collected on the purchase price for outer burial containers.

(c) 110% of the wholesale cost of memorials from the amount collected on the purchase price of memorials.

(d) 100% of the amount collected on the purchase price for all cash advance items sold.

(2) Deposits in trust must occur on the following schedule:

(a) For all preneed contracts entered into between May 1, 2002 (the effective date of the Act) and December 31, 2014, the proper total amount determined by application of the provisions in paragraph (1) shall be deposited in trust within thirty (30) days after the end of the calendar month in which the preneed contract is paid in full unless, before that time, the preneed contract has been cancelled or the seller has discharged its liabilities to provide the merchandise or perform the services specified in the contract.

(b) For preneed contracts entered into on or after January 1, 2015, the seller's obligation to make trust deposits shall commence not later than thirty (30) calendar days after the end of the calendar month in which the sum of the monies collected on the preneed contract exceeds the amount that is not required to be deposited in trust. The seller shall thereafter deposit the appropriate amount in trust not later than thirty (30) days after the end of the month in which each payment on the preneed contract is collected.

(c) For preneed contracts entered into on or after January 1, 2015, at its option, and as an alternative to the schedule in subparagraph (b), a preneed seller may elect to make deposits in trust as payments are received on a preneed contract not later than thirty (30) days after the end of the calendar month in which a payment is collected. In such event, at a minimum, the amount of the deposit must equal the amount determined by application of paragraph (1). The seller must uniformly apply either the schedule in subparagraph (b) or the alternate schedule in this subparagraph to all preneed contracts sold on or after January 1, 2015.

Ala. Admin. Code r. 482-3-004-.04

Adopted by Alabama Administrative Monthly Volume XXXIII, Issue No. 02, November 26, 2014, eff. 1/1/2015.

Author: Commissioner of Insurance

Statutory Authority:Code of Ala. 1975, §§ 27-2-17, 27-17A-1 to -57 (2014).