14VAC5-420-30 - Exemptions

14VAC5-420-30. Exemptions

A. This chapter shall not apply to solicitations or sales involving:

1. Credit insurance;

2. Group life insurance or group annuities where there is no in-person, face-to-face solicitation of individuals by an insurance agent or where the contract or certificate does not include a side fund;

3. 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 commission; or, when a term conversion privilege is exercised among corporate affiliates;

4. Individual standalone health policies, including disability income policies;

5. Contracts offered by SGLI or VGLI;

6. Life insurance contracts offered through or by a nonprofit military association, qualifying under § 501(c)(23) of the Internal Revenue Code (26 USC § 501(c)(23)) and that are not underwritten by an insurer; or

7. Contracts used to fund:

a. An employee pension or welfare benefit plan that is covered by the Employee Retirement and Income Security Act (ERISA) (29 USC § 1001 et seq.);

b. A plan described by §§ 401(a), 401(k), 403(b), 408(k) or 408(p) of the Internal Revenue Code, if established or maintained by an employer;

c. A government or church plan defined in § 414 of the Internal Revenue Code, a government or church welfare benefit plan, or a deferred compensation plan of a state or local government or tax exempt organization under § 457 of the Internal Revenue Code;

d. A nonqualified deferred compensation arrangement established or maintained by an employer or plan sponsor;

e. Settlements of or assumptions of liabilities associated with personal injury litigation or any dispute or claim resolution process; or

f. Prearranged funeral contracts.

B. Nothing herein shall be construed to abrogate the ability of nonprofit organizations or other organizations to educate members of the United States Armed Forces in accordance with Department of Defense DoD Instruction 1344.07, Personal Commercial Solicitation on DoD Installations, March 30, 2006.

C. For purposes of this chapter, general advertisements, direct mail and Internet marketing shall not constitute "solicitation." Telephone marketing shall not constitute "solicitation" provided the caller explicitly and conspicuously discloses that the product concerned is life insurance and makes no statements that avoid a clear and unequivocal statement that life insurance is the subject matter of the solicitation. Nothing in this subsection shall be construed to exempt an insurer or insurance agent from this chapter in any in-person, face-to-face meeting established as a result of the "solicitation" exemptions identified in this subsection.

(Derived from Virginia Register Volume 24, Issue 7, eff. February 15, 2008.)

Statutory Authority

§§ 12.1-13 and 38.2-223 of the Code of Virginia; P.L. 109-290 (Military Personnel Financial Services Protection Act).

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