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What's New: Government Affairs

Sureties in Iowa Fight Bond Waiver

Wednesday, March 18, 2015  
Iowa HSB 13/SSB 1086 would delete the statutory provisions that set forth the bond requirements for sellers of pre-need cemetery and funeral services and merchandise who elect to post the bond instead of meeting the trust fund requirements in the law. Instead, the Iowa Insurance Department (Department) will adopt regulations regarding when a pre-need seller may post the bond in lieu of a trust fund. The Department sought to eliminate the bond because they believed that the bond was hard to obtain and other states do not have options for bonding. The Iowa sureties find the long tail on the current bond difficult given the amount of time to determine if the obligations were completed. The Iowa Association of Sureties (IASC) developed a model law and bond form, and the Department responded that the bond requirements should be done by regulation and circulated proposed rules. IASC sought changes to the proposed rules to resolve the long tail issue by using the “last surety on the bond” approach to address the liability issue, the Department accepted. SFAA still recommends that the bill be amended so that the Department would be required to adopt regulations that include a bond requirement.

Members should visit Government Relations / General Info (Members) for more information.


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