2009 Iowa Code
Title 13 - Commerce
Subtitle 1 - Insurance and Related Regulation
CHAPTER 508 - LIFE INSURANCE COMPANIES
508.31A - FUNDING AGREEMENTS.

        508.31A  FUNDING AGREEMENTS.
         1.  A life insurance company organized under this chapter may
      issue funding agreements.  The issuance of a funding agreement under
      this section is deemed to be doing insurance business.  For purposes
      of this section, "funding agreement" means an agreement for an
      insurer to accept and accumulate funds and to make one or more
      payments at future dates in amounts that are not based on mortality
      or morbidity contingencies of the person to whom the funding
      agreement is issued.  A funding agreement does not constitute life
      insurance, an annuity, or other insurance authorized by section
      508.29, and does not constitute a security as defined in section
      502.102.
         2. a.  Funding agreements may be issued to the following:
         (1)  A person authorized by a state or foreign country to engage
      in an insurance business or a subsidiary of such business.
         (2)  A person for the purpose of funding any of the following:
         (a)  Benefits under an employee benefit plan as defined in the
      federal Employee Retirement Income Security Act of 1974, 29 U.S.C. §
      1001 et seq., maintained in the United States or in a foreign
      country.
         (b)  Activities of an organization exempt from taxation pursuant
      to section 501(c) of the Internal Revenue Code, or any similar
      organization in any foreign country.
         (c)  A program of the United States government, another state
      government or political subdivision of such state, or of a foreign
      country, or any agency or instrumentality of any such government,
      political subdivision, or foreign country.
         (d)  An agreement providing for periodic payments in satisfaction
      of a claim.
         (e)  A program of an institution which has assets in excess of
      twenty-five million dollars.
         (3)  A person other than a natural person that has assets of at
      least twenty-five million dollars.
         (4)  A person other than a natural person for the purpose of
      providing collateral security for securities registered with the
      federal securities and exchange commission.
         b.  A funding agreement issued pursuant to paragraph "a",
      subparagraph (1), (2), or (3), shall be for a total amount of not
      less than one million dollars.
         c.  An amount under a funding agreement shall not be
      guaranteed or credited except upon reasonable assumptions as to
      investment income and expenses and on a basis equitable to all
      holders of funding agreements of a given class.  Such funding
      agreements shall not provide for payments to the insurer based on
      mortality or morbidity contingencies.
         d.  Amounts paid to the insurer pursuant to a funding
      agreement, and proceeds applied under optional modes of settlement,
      may be allocated by the insurer to one or more separate accounts
      pursuant to section 508A.1.
         3.  A funding agreement is a class 2 claim under section 507C.42,
      subsection 2.
         4.  The commissioner may adopt rules to implement funding
      agreements.  

         98 Acts, ch 1057, §4; 99 Acts, ch 3, §1, 2; 2002 Acts, ch 1111,
      §8; 2003 Acts, ch 91, §7; 2003 Acts, ch 179, § 75; 2003 Acts, 1st Ex,
      ch 2, § 28, 209; 2004 Acts, ch 1086, §86
         Referred to in § 507C.42, 508C.3