This rule is issued pursuant to section 3901.041 of the Revised Code.
The purpose of this rule is to amplify section 3901.21 of the Revised Code as it relates to the solicitation of annuities and to require the use of a disclosure statement in conjunction with the sale of single premium deferred annuities.
No annuity shall be advertised or solicited using any language in advertisements or solicitation material of any kind that refers to the annuity as being "risk free," or "guaranteed safe," or using any language with a similar connotation.
At the time an application is taken for a single premium deferred annuity, a disclosure form must be executed by the applicant and the selling agent and attached to the application.
The disclosure language shall be in the exact form as set forth in appendix I of this rule.
Each paragraph of this rule and every part of each paragraph is an independent section and part of a section, and the holding of any section or a part thereof to be unconstitutional, void, or ineffective for any clause does not affect the validity or constitutionality of any other section or part thereof.
(E) Effective Date
The effective date of this rule is December 14, 1985.
Appendix I Single Premium Deferred Annuity Disclosure Form
IMPORTANT: Read this form carefully before buying this annuity.
1. A single premium deferred annuity (SPDA) is an insurance product (with certain investment features) which, under current federal tax laws, allows the buyer to accrue interest for a period of years without having to pay tax on the interest until he cashes the annuity or arranges to receive regular payments.
2. This annuity is NOT "risk free" or "guaranteed safe." It is only as sound as the issuing insurance company.
3. From the beginning of this annuity contract the insurance company guarantees an interest rate of _____% for a period of _____ month(s) or _____ year(s).
(Selling agent must fill in all blanks if applicable; if not applicable, write "n/a").
Subsequent interest guarantees are as follows:
4. Early cash surrender of this annuity MAY result in your being charged a penalty.
5. The selling agent earns a commission on the sale of this annuity which he may have to pay back to the company if you cash in your annuity early.
6. This form MUST BE COMPLETED at the time the application for the SPDA is taken and MUST BE ATTACHED to the application.
Buyer's signature ________________________________________DATE__________
Seller's signature ________________________________________DATE__________
[No other language shall be printed or written on this page.]
R.C. 119.032 review dates: 10/14/2008 and 08/29/2013
Promulgated Under: 119.03
Statutory Authority: 3901.041
Rule Amplifies: 3901.21
Prior Effective Dates: 12/14/1985