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A BILL TO BE ENTITLED
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AN ACT
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relating to a rescission period for annuity contracts. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Subtitle A, Title 7, Insurance Code, is amended |
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by adding Chapter 1116 to read as follows: |
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CHAPTER 1116. REQUIRED PROVISIONS FOR ANNUITY CONTRACT |
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Sec. 1116.001. DEFINITION. In this chapter, "annuity" |
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means a fixed, variable, or modified guaranteed annuity that is |
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individually solicited, whether classified as an individual |
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annuity or group annuity. |
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Sec. 1116.002. RESCISSION PERIOD REQUIRED. (a) A fixed |
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annuity contract must provide that, for a period of at least 20 days |
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after the date the contract is delivered, the purchaser may rescind |
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the contract and receive an unconditional refund of premiums paid |
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for the contract, including any contract fees or charges. |
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(b) Except as provided by Subsection (c), a variable or |
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modified guaranteed annuity contract must provide that, for a |
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period of at least 20 days after the date the contract is delivered, |
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the purchaser may rescind the contract and receive an unconditional |
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refund that is equal to the cash surrender value provided in the |
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contract plus any fees or charges deducted from the premiums or |
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imposed under the contract. |
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(c) Subsection (b) does not apply to an annuity contract if |
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the prospective owner is an accredited investor, as defined by 17 |
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C.F.R. Section 230.501(a) as adopted by the United States |
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Securities and Exchange Commission. |
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SECTION 2. The change in law made by this Act applies only |
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to an annuity contract delivered or issued for delivery on or after |
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January 1, 2012. A contract delivered or issued for delivery before |
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January 1, 2012, is governed by the law in effect immediately before |
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the effective date of this Act, and that law is continued in effect |
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for that purpose. |
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SECTION 3. This Act takes effect September 1, 2011. |