044-12 Wyo. Code R. §§ 12-3 - Definitions

(a) "Replacement" means any transaction in which new life insurance or a new annuity is to be purchased, and it is known or should be known to the proposing producer or to the proposing insurer if there is no producer, that by reason of such transaction, existing life insurance or annuity has been or is to be:

(i) Lapsed, forfeited, surrendered, or otherwise terminated;

(ii) Converted to reduced paid-up insurance, continued as extended term insurance, or otherwise reduced in value by the use of nonforfeiture benefits or other policy values;

(iii) Amended so as to effect either a reduction in benefits or in the term for which coverage would otherwise remain in force or for which benefits would be paid;

(iv) Reissued with any reduction in cash value; or

(v) Pledged as collateral or subjected to borrowing, whether in a single

loan or under a schedule of borrowing over a period of time for amounts in the aggregate exceeding twenty-five percent (25%) of the loan value set forth in the policy.

(b) "Conservation" means any attempt by the existing insurer or its producer to dissuade a policy owner from the replacement of existing life insurance or annuity. Conservation does not include routine administrative procedures such as late payment reminders, late payment offers or reinstatement offers.

(c) "Direct-Response Sales" means any sale of life insurance or annuity where the insurer does not utilize a producer in the sale or delivery of the policy.

(d) "Existing Insurer" means the insurance company whose policy is or will be changed or terminated in such a manner as described within the definition of "replacement."

(e) "Existing Life Insurance or Annuity" means any life insurance or annuity in force, including life insurance under a binding or conditional receipt or a life insurance policy or annuity that is within an unconditional refund period.

(f) "Replacing Insurer" means the insurance company that issues or proposes to issue a new policy or contract which is a replacement of existing life insurance or annuity.

(g) "Registered Contract" means variable annuities, investment annuities, variable life insurance under which the death benefits and cash values vary in accordance with unit values of investments held in a separate account, or any other contracts issued by life insurance companies which are registered with the Federal Securities and Exchange Commission.

(h) "Sales Charge" is defined as any initial charge or fee assessed to the consumer for the purchase of an insurance product. This includes but is not limited to the following terms: front-end loads, separate commission charges, initial premium charge/load, and purchase fees. It does not include contingent deferred sales charges (CDSC) as this charge would be considered a surrender charge, monthly administrative fees, annual contract charges, mortality and expense charges (M&E), premium taxes, or fees on investments in the separate account.

(i) "Surrender Charge" is defined as a charge or fee assessed to the consumer for the surrender, sale, cancellation, termination, transfer, or exchange of an insurance product prior to the maturity or completion of the surrender period stated in the policy.

(j) "Surrender Period" is defined as the amount of time a policyholder must wait in order to receive a withdrawal from an insurance product without a "surrender charge."

Notes

044-12 Wyo. Code R. §§ 12-3