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Colorado Revised Statutes Title 10. Insurance § 10-15-111.5. Change of ownership--rules

Current as of January 01, 2025 | Updated by Findlaw Staff

(1)(a) A sale of an existing preneed contract that changes who provides funeral goods and services is void unless approved by the commissioner under this section. To transfer ownership, the contract seller must report a pending sale of the preneed contract to the commissioner in writing at least fourteen days before the sale closing. The notice must include:

(I) The name and address of the contract seller;

(II) The name and address of the organization proposing to acquire ownership of the preneed contract, referred to in this section as the “transferee”;

(III) The name and address of the owners, operators, corporate officers, partners, or members of the transferee;

(IV) The name and address of the financial institution where preneed funds are held;

(V) The name under which preneed funds are held;

(VI) A description of each preneed contract, arrangement, or agreement included in the sale;

(VII) An accounting of the trust fund and all transferred and outstanding preneed contracts, including the number of pending contracts, the full contract value, the current value for each contract, a record of all disbursements from preneed trust accounts within the last twenty-four months, and the information required in the annual report;

(VIII) Any documents or amendments thereto concerning the trust or insurance funds, or any other preplanning or prefunding agreements;

(IX) A copy of the notice proposed to be sent to the contract buyers after the transfer; and

(X) Any other information that is reasonably required by the commissioner by rule.

(b) The commissioner may, by rule or order, waive or reduce any or all of the requirements in subparagraphs (I) to (X) of paragraph (a) of this subsection (1) as unnecessary or inappropriate in the public interest or for the protection of the contract buyers.

(2)(a) The commissioner shall approve the contract seller's application for change of ownership by written authorization if:

(I) The accounting is complete, accurate, and shows the trust fund is whole and intact;

(II) All required information and documents are filed with the commissioner; and

(III) The transferee holds a valid contract seller's license, or is qualified under section 10-15-103 for a contract seller's license, and is able to perform all transferred preneed contracts in accordance with this article.

(b) The commissioner shall approve or disapprove of the sale of an existing preneed contract in writing within sixty days after receiving the report required by paragraph (a) of subsection (1) of this section. If the commissioner fails to disapprove of the sale in writing within sixty days, the sale is deemed approved.

(3)(a) The contract seller, or person with an interest in the contract, remains liable for all funds and transactions until the effective date of the transfer.

(b) Any discrepancies, malfeasance, or fraud prior to the sale of the preneed contract is the responsibility of the seller, for which the seller is liable.

(4) Within thirty days after approval by the commissioner, the transferee of a preneed contract shall send a notice to the last-known address of each contract buyer informing the buyer of the change in ownership and the assumption of the obligation to perform the preneed contract.

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Cite this article: FindLaw.com - Colorado Revised Statutes Title 10. Insurance § 10-15-111.5. Change of ownership--rules - last updated January 01, 2025 | https://codes.findlaw.com/co/title-10-insurance/co-rev-st-sect-10-15-111-5/

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