(1)
Each
funeral establishment entering into prearrangement funeral service
contracts in which one or more of the following conditions exist must be
registered with the
board before entering into such contracts:
(a) The sales price of the contract, using
either trust or insurance as a method of funding, guarantees a final price for
merchandise and services. The guarantee assures the purchaser that there will
be no additional charges for the merchandise and services disclosed within the
agreement.
(b) The sales price of
the contract using a trust as a method of funding plus accruals will be applied
toward the cost of merchandise and services at the time of need. Should the
cost of merchandise and services selected at the time of need exceed the sales
price of the contract plus accruals, the purchaser will pay the difference.
Should the cost of merchandise and services selected at the time of need be
less than the sales price of the contract plus accruals, the purchaser will
receive a refund for the difference.
(2) Before entering into any prearrangement
funeral service contracts in this state, a
funeral establishment shall first
obtain a certificate of registration from the
board. To apply for registration,
a
funeral establishment must file an application on forms approved by the
board
of funeral directors and embalmers, which includes:
(a) The name, address, and telephone number
of the funeral establishment;
(b) A
statement of the establishment's current financial condition and an explanation
of how the establishment plans to offer, market and service prearrangement
contracts including:
(i) The type of business
organization which operates the funeral establishment, e.g., sole
proprietorship, partnership, or corporation and a list of all officers,
directors, partners and managers by name and title, and any person owning more
than ten percent of the business;
(ii) Other fiscal documents as the board may
require.
(c) The
prearrangement funeral service contract forms the establishment proposes to use
need not be in final printed form when submitted; however, a copy of the final
printed form shall be filed with the board before the form is used;
(d) Identification of the trustee(s) of the
prearrangement funeral service trust, including address and telephone number;
and
(e) A copy of the
prearrangement funeral service trust agreement and the prearrangement funeral
service trust depository agreement.
(3) Upon review of the application, the board
may require additional information or explanation prior to registration or
refusing to register the funeral establishment.
(4) The application shall be accompanied by a
check payable to the state treasurer in the amount required by the director for
issuance of the certificate of registration.
