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                                                      PRINTER'S NO. 1006

THE GENERAL ASSEMBLY OF PENNSYLVANIA


SENATE BILL

No. 853 Session of 2007


        INTRODUCED BY BOSCOLA, MAY 9, 2007

        REFERRED TO BANKING AND INSURANCE, MAY 9, 2007

                                     AN ACT

     1  Amending the act of May 17, 1921 (P.L.682, No.284), entitled "An
     2     act relating to insurance; amending, revising, and
     3     consolidating the law providing for the incorporation of
     4     insurance companies, and the regulation, supervision, and
     5     protection of home and foreign insurance companies, Lloyds
     6     associations, reciprocal and inter-insurance exchanges, and
     7     fire insurance rating bureaus, and the regulation and
     8     supervision of insurance carried by such companies,
     9     associations, and exchanges, including insurance carried by
    10     the State Workmen's Insurance Fund; providing penalties; and
    11     repealing existing laws," providing for additional
    12     notification requirements relating to annuity contracts.

    13     The General Assembly of the Commonwealth of Pennsylvania
    14  hereby enacts as follows:
    15     Section 1.  Section 410E heading of the act of May 17, 1921
    16  (P.L.682, No.284), known as The Insurance Company Law of 1921,
    17  added November 5, 1981 (P.L.325, No.116), is amended and
    18  subsection (b) is amended by adding a paragraph to read:
    19     Section 410E.  Notice of Contractholder's Right to Examine
    20  Annuity or Pure Endowment Contracts and Notification Relating to
    21  Annuity Contracts.--* * *
    22     (b)  * * *


     1     (1.1)  No mutual fund may be sold through, as part of, or in
     2  conjunction with the sale of an annuity contract unless a one-
     3  page notice is affixed to the front of the fund prospectus
     4  which:
     5     (i)  explains that, inasmuch as the fund is being purchased
     6  through, as part of, or in conjunction with an insurance
     7  product, the return generated by the fund and paid to the buyer
     8  will be reduced by certain fees not usually associated with the
     9  purchase of such a fund; and
    10     (ii)  enumerates by type and amount each fee or expense which
    11  will, or which is likely to be, incurred as a result of the
    12  presence of an insurance component in the transaction,
    13  including, but not limited to, mortality and risk charges.
    14     * * *
    15     Section 2.  This act shall take effect in 60 days.










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