AB868-ASA1,8,109 445.125 (3m) Burial agreements funded with proceeds of life insurance
10policies.
(a) In this subsection:
AB868-ASA1,8,1211 1. "Agent" means an authorized representative of a funeral director or operator
12of a funeral establishment.
AB868-ASA1,8,1613 2. "Burial agreement" means a written agreement between an operator of a
14funeral establishment or funeral director and a person in which the operator of the
15funeral establishment or funeral director agrees to provide to a person, after that
16person is deceased, funeral merchandise or funeral services.
AB868-ASA1,8,2417 3. "Cash advance item" means personal property or a service that is obtained
18by a funeral director or operator of a funeral establishment from a 3rd party and that
19is paid for by the funeral director or operator of the funeral establishment on behalf
20of, and subject to reimbursement from, a person purchasing funeral merchandise or
21funeral services from the funeral director or operator of the funeral establishment.
22"Cash advance item" includes cemetery or crematory services, pallbearers, public
23transportation, clergy honoraria, flowers, musicians or vocalists, nurses, obituary
24notices, gratuities and death certificates.
AB868-ASA1,9,9
14. "Funeral merchandise or funeral services" means personal property or
2services typically sold or provided in connection with the final disposition of human
3remains, including caskets or other primary containers not preplaced into the burial
4excavation of a grave, rental, temporary or disposable caskets or containers, outer
5burial containers not preplaced into the burial excavation of a grave, transportation
6containers, funeral clothing and accessories, embalming services and funeral
7directing services. "Funeral merchandise or funeral services" does not include a cash
8advance item or opening and closing costs that are associated with the burial of a
9deceased person.
AB868-ASA1,9,1310 (b) 1. A licensed funeral director, an operator of a funeral establishment, an
11agent of a licensed funeral director or, subject to par. (c), an agent of an operator of
12a funeral establishment may sell or solicit the sale of a burial agreement that is
13funded with the proceeds of a life insurance policy if all of the following apply:
AB868-ASA1,9,1514 a. The burial agreement meets the requirements specified in pars. (d) to (f) and
15in the rules promulgated by the examining board under par. (j) 1. b.
AB868-ASA1,9,1716 b. The licensed funeral director, operator of the funeral establishment or agent
17is licensed as an insurance intermediary under ch. 628.
AB868-ASA1,9,2218 2. a. A licensed funeral director or operator of a funeral establishment may
19authorize an agent who is an insurance intermediary licensed under ch. 628, and
20who meets the training requirements established by the examining board under par.
21(j) 1. a., to sell or solicit the sale of a burial agreement that is funded with the proceeds
22of a life insurance policy and that meets the requirements specified in pars. (d) to (f).
AB868-ASA1,9,2523 b. A licensed funeral director or operator of a funeral establishment shall report
24to the examining board the identity of any agent authorized by the licensed funeral
25director or operator of the funeral establishment under subd. 2. a. and provide

1evidence satisfactory to the examining board that such agent meets the training
2requirements established by the examining board by rule under par. (j) 1. a. The
3examining board shall promulgate rules establishing requirements and procedures
4for making reports and providing the evidence required under this subd. 2. b.
AB868-ASA1,10,165 c. A licensed funeral director or operator of a funeral establishment is
6responsible for and bound by any act of an agent, authorized by the licensed funeral
7director or operator of the funeral establishment under subd. 2. a., that is within the
8scope of the agent's apparent authority, while a contract under par. (c) 1. between the
9agent and the licensed funeral director or operator of the funeral establishment
10remains in force, and after that time until the licensed funeral director or operator
11of the funeral establishment has made reasonable efforts to recover from the agent
12any forms for burial agreements provided to the agent by the licensed funeral
13director or operator of the funeral establishment and other indicia of agency.
14Reasonable efforts shall include a formal demand in writing for return of the indicia,
15and notice to the examining board if the agent does not comply with the demand
16promptly.
AB868-ASA1,10,2217 (c) 1. No agent of an operator of a funeral establishment may solicit the sale of
18or sell a burial agreement funded with the proceeds of a life insurance policy unless
19he or she has a contract with the operator of the funeral establishment that
20authorizes him or her to act as the agent of the operator of the funeral establishment
21and that satisfies the requirements established by the examining board by rule
22under par. (j) 1. c.
AB868-ASA1,10,2523 2. If an agent of an operator of a funeral establishment solicits the sale of or sells
24a burial agreement funded with the proceeds of a life insurance policy, the agent shall
25do all of the following at the time of solicitation:
AB868-ASA1,11,2
1a. Disclose to the prospective purchaser of the burial agreement the identity
2of the funeral establishment of which he or she is an agent.
AB868-ASA1,11,63 b. Furnish to the applicant a copy of the booklet prepared and distributed by
4the examining board under par. (j) 3. that describes the differences between funding
5a burial agreement with the proceeds of a life insurance policy under this subsection
6and entering into a burial agreement funded by a trust under sub. (1).
AB868-ASA1,11,107 (d) A burial agreement that is funded with the proceeds of a life insurance
8policy shall specify in the agreement the funeral establishment that will be used to
9provide the funeral services or funeral merchandise to be provided under the
10agreement.
AB868-ASA1,11,1411 (e) 1. A burial agreement that is funded with the proceeds from a life insurance
12policy shall include a provision setting forth the nature and extent of any price
13guarantee for the funeral merchandise or funeral services that are to be provided
14under the burial agreement.
AB868-ASA1,11,1915 2. If an agent solicits and sells a burial agreement that is funded with the
16proceeds of a life insurance policy, the licensed funeral director who owns the funeral
17establishment or is an agent of the operator of the funeral establishment that will
18provide funeral merchandise or funeral services under the burial agreement shall
19ratify the burial agreement in writing and with his or her signature.
AB868-ASA1,11,2520 (f) The price of any funeral merchandise or funeral services provided under a
21burial agreement funded with the proceeds of a life insurance policy may not exceed
22the price for the merchandise or services that, at the time that the merchandise is
23provided or the services are performed, is set forth in the funeral establishment's
24general price list required under the funeral industry practices regulations of the
25federal trade commission.
AB868-ASA1,12,6
1(g) Before an agent, a licensed funeral director or an operator of a funeral
2establishment accepts an applicant's initial premium for a burial agreement that is
3funded or will be funded by a life insurance policy, the agent, funeral director or
4operator of a funeral establishment shall comply with the requirements under par.
5(h) and shall, in a writing that is clear and conspicuous, disclose the following
6information to the applicant:
AB868-ASA1,12,87 1. The fact that a life insurance policy is involved in or connected to, or is being
8used to fund, the burial agreement.
AB868-ASA1,12,99 2. The type of insurance instrument that is funding the burial agreement.
AB868-ASA1,12,1010 3. The effect on the burial agreement of all of the following:
AB868-ASA1,12,1311 a. Changing the life insurance policy, including changing the assignment of the
12policy proceeds, changing the beneficiary designation or changing the use of the
13proceeds.
AB868-ASA1,12,1514 b. Any penalties incurred by the policyholder as a result of failing to make
15premium payments.
AB868-ASA1,12,1716 c. Any penalties incurred or money received as a result of cancellation or
17surrender of the life insurance policy.
AB868-ASA1,12,2018 4. The nature of the relationship between the insurance intermediary who
19solicited or is selling the life insurance policy and the funeral establishment that will
20be providing funeral or burial merchandise or services under the burial agreement.
AB868-ASA1,12,2321 5. The relationship of the life insurance policy to the funding of the burial
22agreement and the existence and terms of any guarantees, other than a guarantee
23specified in subd. 6., relating to the burial agreement.
AB868-ASA1,13,724 6. A list of the funeral merchandise and funeral services that are applied for
25or contracted for under the burial agreement and all relevant information

1concerning the price of the funeral services provided under the burial agreement,
2including a statement as to whether the purchase price of the funeral merchandise
3or funeral services provided under the burial agreement is guaranteed at the time
4of the purchase of the burial agreement or whether the purchase price of the funeral
5merchandise or funeral services provided under the burial agreement is to be
6determined at the time of need, and a statement that the price of the funeral
7merchandise or funeral services is subject to the limit specified in par. (f).
AB868-ASA1,13,118 7. All relevant information concerning what occurs, and whether any
9entitlements or obligations arise, if there is a difference between the proceeds of the
10life insurance policy and the amount of money actually needed to fund the burial
11agreement.
AB868-ASA1,13,1512 8. Any restrictions, including geographic restrictions, or penalties relating to
13delivery or performance under the burial agreement, including any restrictions or
14penalties relating to the inability of the operator of the funeral establishment to
15perform.
AB868-ASA1,13,1816 9. A statement as to whether a sales commission or other form of compensation
17is being paid to the agent who sold or solicited the sale of a burial agreement and, if
18so, the identity of the persons to whom the commission or other compensation is paid.
AB868-ASA1,13,2419 (h) If an applicant under par. (g) is terminating a trust established under sub.
20(1), the agent, licensed funeral director or operator of the funeral establishment
21shall, before accepting the applicant's initial premium, furnish written notice to the
22examining board that satisfies requirements established by the examining board by
23rule under par. (j) 1. d., and may not accept the applicant's initial premium until 30
24days after providing written notice under this paragraph.
AB868-ASA1,14,5
1(hm) An agent authorized by a licensed funeral director or operator of a funeral
2establishment under par. (b) 2. a. may not engage in unfair or deceptive acts or
3practices specified in the funeral industry practices regulations of the federal trade
4commission, and shall comply with requirements to prevent unfair or deceptive acts
5or practices specified in such regulations.
AB868-ASA1,14,96 (i) 1. A licensed funeral director or operator of a funeral establishment who,
7either directly or through an agent, solicits the sale of or sells a burial agreement
8funded with the proceeds of a life insurance policy shall maintain a record of the
9burial agreement that identifies the life insurance policy used to fund the agreement.
AB868-ASA1,14,1310 2. The funeral director under subd. 1. or the funeral director in charge of the
11funeral establishment under subd. 1. shall make a record maintained under subd.
121. available to the examining board if the board submits a written request to examine
13the record to the funeral director at least 3 days before the examination is to occur.
AB868-ASA1,14,1514 (j) 1. The examining board shall promulgate rules establishing all of the
15following:
AB868-ASA1,14,1716 a. Training requirements that an insurance intermediary licensed under ch.
17628 must satisfy to sell or solicit the sale of a burial agreement under this subsection.
AB868-ASA1,14,1918 b. Minimum standards that an individual burial agreement must satisfy if it
19is funded with the proceeds of a life insurance policy.
AB868-ASA1,14,2320 c. Minimum standards that a contract between an agent and an operator of a
21funeral establishment must satisfy to authorize the agent to sell or solicit the sale
22of a burial agreement funded with the proceeds of a life insurance policy on behalf
23of the operator of the funeral establishment.
AB868-ASA1,15,224 d. The form and content of written notice that a licensed funeral director,
25operator of a funeral establishment or agent of a licensed funeral director or operator

1of a funeral establishment is required to provide to the examining board under par.
2(h).
AB868-ASA1,15,73 2. The examining board may promulgate rules establishing standards for
4marketing practices for burial agreements, including standards for telephone
5solicitation of prospective purchasers. The rules promulgated under this subdivision
6may prohibit a method of telephone solicitation if the examining board determines
7that the prohibition is necessary to protect the public.
AB868-ASA1,15,128 3. The examining board shall prepare and distribute a booklet that describes
9the differences between funding a burial agreement with the proceeds of a life
10insurance policy under this subsection and entering into a burial agreement funded
11by a trust under sub. (1). The examining board may charge a reasonable fee for the
12cost of preparation and distribution of the booklet.
AB868-ASA1, s. 17 13Section 17. 445.125 (4) of the statutes is renumbered 445.125 (4) (intro.) and
14amended to read:
AB868-ASA1,15,1615 445.125 (4) (title) Applicability. (intro.) This section shall not apply to any of
16the following:
AB868-ASA1,15,18 17(a) A contract to provide funeral and burial service for any person if such
18contract is incidental to maintaining such person in a home, hospital or institution.
AB868-ASA1, s. 18 19Section 18. 445.13 (1) of the statutes is amended to read:
AB868-ASA1,16,620 445.13 (1) Subject to the rules promulgated under s. 440.03 (1), the examining
21board may make investigations, subpoena witnesses, conduct hearings, limit,
22suspend or revoke licenses a license of a funeral directors, certificates director, a
23certificate
of registration of apprentices and permits an apprentice or a permit of
24operators an operator of a funeral establishments establishment and reprimand a
25funeral directors, apprentices and director, apprentice or operator of a funeral

1establishments establishment for any violation of 15 USC 45 and 57, of this chapter
2or of any rule of the department of health and family services or the examining board
3or, for unprofessional conduct, including misrepresentation or fraud in obtaining the
4license, permit or certificate of registration, or for any violation of this chapter or any
5rule of the examining board by an agent authorized by the funeral director or
6operator of the funeral establishment under s. 445.125 (3m) (b) 2. a
.
AB868-ASA1, s. 19 7Section 19. 445.13 (1e) of the statutes is created to read:
AB868-ASA1,16,128 445.13 (1e) In addition to or in lieu of a reprimand or limitation, suspension
9or revocation of a license or permit under sub. (1), the examining board may assess
10against any person who violates s. 445.12 (3g) or (3r) or 445.125 (3m) or a rule
11promulgated under s. 445.125 (3m) (j) a forfeiture of no more than $1,000 for each
12violation.
AB868-ASA1, s. 20 13Section 20. 445.13 (2) of the statutes is amended to read:
AB868-ASA1,16,1614 445.13 (2) No reprimand or order limiting, suspending or revoking a license,
15certificate of registration or permit, or no assessment of forfeiture, shall be made
16until after a public hearing conducted by the examining board.
AB868-ASA1, s. 21 17Section 21. 445.15 (1) of the statutes is amended to read:
AB868-ASA1,16,2118 445.15 (1) Any Except as provided in sub. (1m), any person violating any
19provision of this chapter or any rule of the department of health and family services
20and the examining board relating to its subject matter, shall be fined not less than
21$50 nor more than $200, or imprisoned not less than 30 days nor more than 3 months.
AB868-ASA1, s. 22 22Section 22. 445.15 (1m) of the statutes is created to read:
AB868-ASA1,17,323 445.15 (1m) A funeral director or operator of a funeral establishment who
24violates s. 445.12 (3r) shall be fined not more than $5,000 for each violation. Each
25day that an insurance intermediary authorized by a funeral director or operator of

1a funeral establishment fails to meet the training requirements established by the
2examining board by rule under s. 445.125 (3m) (j) 1. a. constitutes a separate
3violation of s. 445.12 (3r) (b).
AB868-ASA1, s. 23 4Section 23. 632.41 (2) of the statutes is renumbered 632.41 (2) (a) and
5amended to read:
AB868-ASA1,17,96 632.41 (2) (a) No Except as provided in par. (b), no contract in which the insurer
7agrees to pay for any of the incidents of burial or other disposition of the body of a
8deceased may provide that the benefits are payable to a funeral director or any other
9person doing business related to burials.
AB868-ASA1, s. 24 10Section 24. 632.41 (2) (b) of the statutes is created to read:
AB868-ASA1,17,1811 632.41 (2) (b) 1. A life insurance policy may provide for the assignment of the
12proceeds of the policy to a funeral director or operator of a funeral establishment if
13the insurance intermediary who sells or solicits the sale of the policy is not an agent
14of the funeral director or operator of the funeral establishment or if the assignment
15of proceeds is contingent on the provision of funeral merchandise or funeral services
16as provided for in a burial agreement that satisfies the requirements of s. 445.125
17(3m) and rules promulgated by the funeral directors examining board under s.
18445.125 (3m) (j) 1. b.
AB868-ASA1,17,2119 2. Subject to subd. 3., the commissioner shall by rule establish minimum
20standards for benefits, claims payments, marketing practices, compensation
21arrangements and reporting practices for life insurance policies sold under subd. 1.
AB868-ASA1,18,222 3. A life insurance policy sold under subd. 1. shall permit the policyholder to
23designate a different beneficiary, after written notice to the current beneficiary, and
24a different funeral director or operator of a funeral establishment that is to receive

1the assignment of proceeds, after written notice to the current funeral director or
2operator of the funeral establishment.
AB868-ASA1, s. 25 3Section 25. 701.12 (1) of the statutes is amended to read:
AB868-ASA1,18,64 701.12 (1) By written consent of the settlor and all beneficiaries of a trust or
5any part thereof, such trust or part thereof may be revoked, modified or terminated,
6except as provided under s. 445.125 (1) (b) (a) 2. to (d) 4.
AB868-ASA1, s. 26 7Section 26 . Nonstatutory provisions.
AB868-ASA1,18,128 (1) The office of the commissioner of insurance shall submit in proposed form
9the rules required under section 632.41 (2) (b) 2. of the statutes, as created by this
10act, to the legislative council staff under section 227.15 (1) of the statutes no later
11than the first day of the 7th month beginning after the effective date of this
12subsection.
AB868-ASA1,18,1713 (2) The funeral directors examining board shall submit in proposed form the
14rules required under section 445.125 (3m) (b) 2. b. and (j) 1. of the statutes, as created
15by this act, to the legislative council staff under section 227.15 (1) of the statutes no
16later than the first day of the 7th month beginning after the effective date of this
17subsection.
AB868-ASA1,18,2118 (3) The funeral directors examining board shall prepare for distribution the
19booklet required under section 445.125 (3m) (j) 3. of the statutes, as created by this
20act, no later than the first day of the 7th month beginning after the effective date of
21this subsection.
AB868-ASA1, s. 27 22Section 27. Effective dates. This act takes effect on the first day of the 13th
23month beginning after publication, except as follows:
AB868-ASA1,19,2
1(1) The treatment of Section 26 of this act takes effect on the day after
2publication.
Loading...
Loading...