02-029-130 Me. Code R. § IV

Current through 2024-46, November 13, 2024

Section 029-130-IV - GENERAL PROVISIONS OF THE REGULATION

A. A financial institution may engage in the sale of annuities subject to the following:

(1) The financial institution and its employees must be licensed to the extent required by the Maine Insurance Code (Title 24-A MRSA);

(2) The financial institution must provide and retain the disclosures in accordance with Section VIII of this regulation; and

(3) The financial institution may not sell, or provide to any person, the name of any person that has purchased annuities through that financial institution. This does not limit the financial institution's obligation to provide information to the insurer in the sale of an annuity product.

B. A financial institution or its affiliate may enter into an arrangement with an annuity agent under which the financial institution may refer customers directly to the annuity agent for the sale of annuities. A financial institution or its affiliate may enter into arrangements with an annuity agent to provide space on financial institution premises for sale of annuities. No such arrangements may be entered into with an annuity agent who is a director of the financial institution or with an agency if a director of the financial institution has a financial interest in the agency. This prohibition shall not apply to arrangements between a financial institution or a financial institution holding company and its affiliate if the affiliate is the annuity agent selling annuities on behalf of the financial institution. Any arrangement between a financial institution or its affiliate and an annuity agent that utilizes space on the premises of a financial institution to facilitate the sale of annuities shall be subject to the following general condition:

(1) The financial institution and the annuity agent must enter into an Agreement addressing any commission-sharing arrangements. In addition, this agreement shall:

(a) Require that annuities may be sold only by an annuity agent;

(b) Reserve the right of the financial institution to disapprove the placement or retention of any annuity agent;

(c) Require the annuity agent to provide and retain disclosures in accordance with Section VIII of this regulation.

(d) Require the annuity agent to receive prior approval of the financial institution before engaging in any advertising/solicitation of annuities products on behalf of the financial institution.

(2) When the annuities sales program is operated by a person that is not an affiliate of the financial institution and annuities are sold on the premises of the financial institution, the financial institution must include in an Agreement or a Lease Agreement with the annuity agent language that expressly:

(a) Negates a partnership or joint venture between the financial institution and the annuity agent; and

(b) States that the financial institution has no right to, and may not attempt to, exercise control over the sale of annuities by the annuity agent other than as expressly permitted by this Regulation.

C. A financial institution shall serve written notice to the Bureau when it has entered into an Agreement and/or Lease Agreement required by this Regulation. When a financial institution has a single program for the sale of both mutual funds and annuities, the agreements that must be adopted, entered into, and/or filed under Regulations #29 and #30 need not be duplicative, but may be combined.

02-029 C.M.R. ch. 130, § IV