Section 38a-435-1 - Purpose and Scope(a) The purpose of sections 38a-435-1 to 38-435-8, inclusive, of the Regulations of Connecticut State Agencies is: (1) To regulate the activities of insurers and producers with respect to the replacement of existing life insurance and annuities.(2) To protect the interests of life insurance and annuity purchasers by establishing minimum standards of conduct to be observed in replacement or financed purchase transactions, which will: (A) Ensure that purchasers receive information with which a decision can be made in his or her own best interest; and(B) Reduce the opportunity for misrepresentation and incomplete disclosure.(b) Unless specifically included, sections 38a-435-1 to 38a-435-8, inclusive, of the Regulations of Connecticut State Agencies shall not apply to transactions involving: (1) Credit life insurance;(2) Group life insurance or group annuities where there is no direct solicitation of individuals by a producer. Direct solicitation shall not include any group meeting held by a producer solely for the purpose of educating or enrolling individuals or, when initiated by an individual member of the group, assisting with the selection of investment options offered by a single insurer in connection with enrolling that individual. Group life insurance or group annuity certificates marketed through direct response solicitation shall be subject to the provisions of section 38a-435-7 of the Regulations of Connecticut State Agencies;(3) Group life insurance and annuities used to fund prearranged funeral service contracts;(4) An application to the existing insurer that issued the existing policy or contract when a contractual change or a conversion privilege is being exercised; or, when the existing policy or contract is being replaced by the same insurer pursuant to a program filed with and approved by the commissioner; or, when a term conversion privilege is being exercised among corporate affiliates;(5) Proposed life insurance that is to replace life insurance under a binding or conditional receipt issued by the same company;(6)(A) Policies or contracts used to fund (i) an employee pension or welfare benefit plan that is covered by the Employee Retirement and Income Security Act (ERISA); (ii) a plan described by sections 401(a), 401(k) or 403(b) of the Internal Revenue Code, where the plan, for purposes of ERISA, is established or maintained by an employer; (iii) a governmental or church plan defined in section 414 of the Internal Revenue Code, a governmental or church welfare benefit plan, or a deferred compensation plan of a state or local government or tax exempt organization under section 457 of the Internal Revenue Code; or (iv) a nonqualified deferred compensation arrangement established or maintained by an employer or plan sponsor.(B) Notwithstanding subparagraph (A) of this subdivision, sections 38a-435-1 to 38a-435-8, inclusive, of the Regulations of Connecticut State Agencies shall apply to policies or contracts used to fund any plan or arrangement that is funded solely by contributions an employee elects to make, whether on a pre-tax or after-tax basis, and where the insurer has been notified that plan participants may choose from among two (2) or more insurers and there is a direct solicitation of an individual employee by an insurance producer for the purchase of a contract or policy. As used in this subsection, direct solicitation shall not include any group meeting held by a producer solely for the purpose of educating individuals about the plan or arrangement or enrolling individuals in the plan or arrangement or, when initiated by an individual employee, assisting with the selection of investment options offered by a single insurer in connection with enrolling that individual employee;(7) Where new coverage is provided under a policy or contract and the cost is borne wholly by the insured's employer or by an association of which the insured is a member;(8) Existing life insurance that is a non-convertible term life insurance policy that will expire in no more than five (5) years and cannot be renewed;(9) Immediate annuities that are purchased with proceeds from an existing contract. Immediate annuities purchased with proceeds from an existing policy are not exempted from the requirements of sections 38a-435-1 through 38a-435-8, inclusive, of the Regulations of Connecticut State Agencies; or(10) Structured settlements.(c) Registered contracts shall be exempt from the requirements of section 38a-435-5(a)(2) and section 38a-435-6(2) of the Regulations of Connecticut State Agencies with respect to the provision of illustrations or policy summaries; however, premium or contract contribution amounts and identification of the appropriate prospectus or offering circular shall be required instead.Conn. Agencies Regs. § 38a-435-1