Public-domain · open source
OpenJurist

Iowa Code § 523A.207

Transfer of preneed purchase agreements — sale of a business or business assets

Redline — January 1, 2017 → current.View current text →
Current — January 1, 2024
As of January 1, 2017
1. A purchase agreement shall not be sold or transferred as part of the sale of a business, or of the assets of a business, until the seller of the business has provided all of the following to the buyer of the business:
a. A copy of the most recent annual report filed with the commissioner by the seller.
b. The aggregate amount of any interest income withdrawn to date from trust accounts pursuant to section 523A.201, subsection 8.
c. Copies of all purchase agreements to be assumed by the buyer.
d. A list of the purchase agreements provided under paragraph “c” that includes all of the following:
(1) The name of the purchaser and the name of the seller of each purchase agreement.
(2) The total dollar amount of each purchase agreement.
(3) The date each purchase agreement was executed.
(4) Whether each purchase agreement is guaranteed, nonguaranteed, or mixed, and affirm or deny one hundred percent trusting of any guaranteed items and specify the lesser amount or percentage placed in trust, if applicable.
e. A list of insurance policies that are applicable to the purchase agreements provided under paragraph “c”. The list shall identify the purchase agreement to which each insurance policy applies, the named policyholder on each insurance policy, and the face amount of each insurance policy.
f. A list of trust fund beneficiaries and the amount in trust for each beneficiary.
g. A list that identifies and describes any items of presold merchandise that are not fully funded with insurance or trust funds in compliance with this chapter, and the amount or percentage that is either unfunded or underfunded.
2. a. The seller of a business shall file a disclosure with the commissioner that contains the information required under subsection 1, paragraphs “d” and “e”, at least thirty calendar days prior to the date of the transfer of any purchase agreements to the buyer.
1. A purchase agreement shall not be sold or transferred, as part of the sale of a business or the assets of a business, until an audit has been performed by a certified public accountant and filed with the commissioner that expresses the auditor’s opinion of the adequacy of funding related to the purchase agreements to be sold or transferred. If the buyer of a purchase agreement sold or transferred as part of the sale of a business or the assets of a business, fails to file such an audit, the commissioner shall suspend the preneed seller’s license of the buyer and the preneed sales license of any sales agent in the employ of the buyer until the audit is filed. In addition, the commissioner shall assess a penalty against the buyer in an amount up to one hundred dollars for each day that the audit remains unfiled. The commissioner shall allow a thirty-day grace period after the date that a purchase agreement is sold or transferred before suspension of a license or assessment of a penalty for failure to file an audit pursuant to this subsection.
b. If the seller fails to file the disclosure required under paragraph “a”, the commissioner may suspend the buyer’s preneed seller’s license, the seller’s preneed seller’s license, and the license of any sales agent authorized to sell for the buyer or seller until the disclosure is filed. In addition, the commissioner may assess a penalty against the buyer or seller in an amount up to one hundred dollars for each calendar day that the disclosure remains unfiled. The commissioner shall allow a thirty-day grace period after the date that a purchase agreement is sold or transferred before the commissioner suspends the preneed seller’s license of the buyer, seller, or of a sales agent authorized to sell for the buyer or seller, or assesses a penalty against the buyer or seller. Upon good cause, the commissioner may issue an order waiving the disclosure requirement.
2. All records maintained by the commissioner under this section shall be confidential pursuant to section 22.7, subsection 58, and shall not be made available for inspection or copying except upon approval of the commissioner or the attorney general, or except when sought by the preneed seller to whom the records relate. Such records shall be privileged and confidential in any judicial or administrative proceeding except any of the following:
3. All records maintained by the commissioner under this section shall be confidential pursuant to section 22.7, subsection 58, and shall not be made available for inspection or copying except upon prior written approval of either the commissioner or the attorney general, or if sought by the preneed seller to whom the records relate. Such records shall be privileged and confidential in a judicial or administrative proceeding except for any of the following:
a. An action commenced by the commissioner.
a. An action commenced by the commissioner.
b. An administrative proceeding brought by the insurance division.
b. An administrative proceeding brought by the division.
c. An action or proceeding which arises out of the criminal provisions of the laws of this state or of the United States.
c. An action or proceeding which arises out of the criminal provisions of the laws of this state or of the United States.
d. An action brought by the insurance division or the attorney general to recover moneys for embezzlement, misappropriation, or misuse of trust funds.
d. An action brought by the division or the attorney general to recover moneys from embezzlement, misappropriation, or misuse of trust funds.
Subsection 1 amended
2022 strike and rewrite of section applies to purchase agreements sold or transferred as part of the sale of a business, or the assets of a business, on or after July 1, 2022; 2022 Acts, ch 1047, §8

Official source: Iowa Legislature. Reproduced from public-domain Iowa statutes; confirm against the official source for the current text. Not legal advice.