2012 Indiana Code
TITLE 27. INSURANCE
ARTICLE 2. POWERS AND DUTIES OF INSURERS
CHAPTER 22. RETAINED ASSET ACCOUNTS

IC 27-2-22
Chapter 22. Retained Asset Accounts

IC 27-2-22-1
Application of chapter
Sec. 1. This chapter applies to a claim that is filed under a policy after June 30, 2011.
As added by P.L.67-2011, SEC.1.

IC 27-2-22-2
"Commissioner"
Sec. 2. As used in this chapter, "commissioner" refers to the insurance commissioner appointed under IC 27-1-1-2.
As added by P.L.67-2011, SEC.1.

IC 27-2-22-3
"Insured"
Sec. 3. As used in this chapter, "insured" means the individual whose life is the subject of insurance under a policy.
As added by P.L.67-2011, SEC.1.

IC 27-2-22-4
"Insurer"
Sec. 4. As used in this chapter, "insurer" means an insurance company that issues a policy.
As added by P.L.67-2011, SEC.1.

IC 27-2-22-5
"Policy"
Sec. 5. As used in this chapter, "policy" means a policy or certificate that provides the kind of insurance described in Class 1 of IC 27-1-5-1.
As added by P.L.67-2011, SEC.1.

IC 27-2-22-6
"Retained asset account"
Sec. 6. As used in this chapter, "retained asset account" means a mechanism through which the settlement of proceeds payable under a policy occurs by the insurer's deposit of the proceeds into a checking or draft account:
(1) in which the proceeds are retained by the insurer; and
(2) under a contract that is supplemental to the policy and does not involve annuity benefits.
As added by P.L.67-2011, SEC.1.

IC 27-2-22-7
Requirements for use of retained asset account
Sec. 7. An insurer may not use a retained asset account unless, before the policy proceeds are transferred to the retained asset account, the insurer: (1) informs:
(A) the beneficiary;
(B) the legal representative of the beneficiary; or
(C) in the case of a group policy, the policy owner;
of the beneficiary's right to a lump sum payment of the full amount of the policy proceeds; and
(2) makes the disclosure described in section 8(c) of this chapter to the beneficiary.
As added by P.L.67-2011, SEC.1.

IC 27-2-22-8
Required disclosures by insurer to the beneficiary
Sec. 8. (a) An insurer that pays a policy death benefit in any manner other than a lump sum payment of the full amount of the policy proceeds shall provide, in written or electronic form, a disclosure containing a complete list and clear explanation of all payment options available to the beneficiary.
(b) An insurer described in subsection (a) shall not use a retained asset account as the default manner of payment of the policy death benefit unless the insurer conspicuously discloses to the beneficiary that, in the event that the beneficiary does not choose another payment option, a retained asset account will be used as the default manner of payment.
(c) The disclosure required by section 7 of this chapter must include the following information:
(1) A recommendation for the beneficiary to consult a tax, investment, or other financial adviser regarding tax liability and investment options.
(2) The:
(A) method by which interest rates are determined;
(B) timing and method of interest rate changes; and
(C) dividends or other gains that may be paid to the beneficiary;
applicable to the funds in the retained asset account.
(3) The identity of the custodian of the funds in the retained asset account.
(4) Whether the retained asset account is insured by the Federal Deposit Insurance Corporation and, if so, the amount of the coverage.
(5) Any limitations on the number and amount of withdrawals of funds from the retained asset account, including minimum or maximum benefit payment amounts.
(6) Services related to the retained asset account that are provided for a fee, including a list of the fees or method of calculation of the fees.
(7) The nature and frequency of statements of account for the retained asset account.
(8) That the payment of some or all of the proceeds may be by the delivery of checks, drafts, or other instruments to access the available funds. (9) That the entire proceeds are available to the beneficiary by the use of one (1) check, draft, or other instrument.
(10) That the insurer or a related party may derive income, in addition to fees charged on the retained asset account, from the total gains received on the investment of the balance of funds in the retained asset account.
(11) The telephone number, address, and other contact information, including Internet web site address, from which the beneficiary may obtain additional information regarding the retained asset account.
(12) The following statement:
"FOR FURTHER INFORMATION, PLEASE CONTACT YOUR STATE DEPARTMENT OF INSURANCE.".
(d) The disclosures described in this section must be written in:
(1) layman's terms; and
(2) bold or at least 12 point type.
As added by P.L.67-2011, SEC.1. Amended by P.L.6-2012, SEC.187.

IC 27-2-22-9
Violation of chapter
Sec. 9. A violation of this chapter is an unfair and deceptive act in the business of insurance under IC 27-4-1-4.
As added by P.L.67-2011, SEC.1.