2009 Iowa Code
Title 13 - Commerce
Subtitle 1 - Insurance and Related Regulation
CHAPTER 508E - VIATICAL SETTLEMENT CONTRACTS
508E.13 - PROHIBITED PRACTICES AND CONFLICTS OF INTEREST.

        508E.13  PROHIBITED PRACTICES AND CONFLICTS OF
      INTEREST.
         1.  With respect to any viatical settlement contract or insurance
      policy, a viatical settlement broker shall not knowingly solicit an
      offer from, effectuate a viatical settlement with, or make a sale to
      any viatical settlement provider, viatical settlement purchaser,
      financing entity, or related provider trust that is controlling,
      controlled by, or under common control with such viatical settlement
      broker unless such relationship is disclosed to the viator.
         2.  With respect to any viatical settlement contract or insurance
      policy, a viatical settlement provider shall not knowingly enter into
      a viatical settlement contract with a viator, if, in connection with
      such viatical settlement contract, anything of value will be paid to
      a viatical settlement broker that is controlling, controlled by, or
      under common control with such viatical settlement provider or the
      viatical settlement purchaser, financing entity, or related provider
      trust that is involved in such viatical settlement contract unless
      such relationship is disclosed to the viator.
         3.  A viatical settlement provider shall not enter into a premium
      finance agreement with any person or agency, or any person affiliated
      with such person or agency, pursuant to which such person or agency
      shall receive any proceeds, fees, or other consideration, directly or
      indirectly, from the policy or owner of the policy or any other
      person with respect to the premium finance agreement or any viatical
      settlement contract or other transaction related to such policy that
      are in addition to the amounts required to pay the principal,
      interest, and service charges related to policy premiums pursuant to
      the premium finance agreement or subsequent sale of such agreement.
      Any payments, charges, fees, normal insurance commissions, or other
      amounts in addition to the amounts required to pay the principal,
      interest, and service charges related to policy premiums paid under
      the premium finance agreement shall be remitted to the original owner
      of the policy or to the original owner's estate if the original owner
      is not living at the time of the determination of the overpayment.
         4.  A violation of subsection 1, 2, or 3 shall be deemed a
      fraudulent viatical settlement act.
         5.  A person shall not issue, solicit, market, or otherwise
      promote the purchase of an insurance policy for the sole purpose of
      or with a primary emphasis on settling the policy.
         6.  A person providing premium financing shall not receive any
      proceeds, fees, or other consideration from the policy or owner of
      the policy that are in addition to the amounts required to pay
      principal, interest, and any costs or expenses incurred by the lender
      or borrower in connection with the premium finance agreement, except
      for the event of a default, unless either the default on such loan or
      transfer of the policy occurs pursuant to an agreement or
      understanding with any other person for the purpose of evading
      regulation under this chapter.  Any payments, charges, fees, or other
      amounts received by a person providing premium financing in violation
      of this subsection shall be remitted to the original owner of the
      policy or to the original owner's estate if the original owner is not
      living at the time of the determination of overpayment.
         7.  In the solicitation, application for, or issuance of a life
      insurance policy, a person shall not employ any device, scheme, or
      artifice to create an insurable interest in the life of a person
      except as provided in sections 511.39 and 511.40.
         8.  No viatical settlement provider shall enter into a viatical
      settlement contract unless the viatical settlement promotional,
      advertising, and marketing materials, as may be prescribed by rules
      adopted by the commissioner, have been filed with the commissioner.
      In no event shall any marketing materials expressly reference that
      the insurance is free for any period of time.  The inclusion of any
      reference in the marketing materials that would cause a viator to
      reasonably believe that the insurance is free for any period of time
      shall be considered a violation of this chapter.
         9.  No life insurance producer, insurance company, viatical
      settlement broker, or viatical settlement provider shall make any
      statement or representation to the applicant or policyholder in
      connection with the sale or financing of a life insurance policy to
      the effect that the insurance is free or without cost to the
      policyholder for any period of time unless provided in the policy.
      

         2008 Acts, ch 1155, §13