Connecticut General Statutes
Chapter 700b - Life Insurance, Annuities, Burial Contracts and Life Settlements
Section 38a-465a. - Licensing of life settlement providers and brokers.

(a) Except as otherwise provided in this part, no person shall act as a provider or broker until the person is licensed by the commissioner pursuant to this section.

(b) Any applicant for a license as a provider or broker shall submit written application to the commissioner. Such applicants shall provide such information as the commissioner requires. All initial applications shall be accompanied by a filing fee specified in section 38a-11.
(c) A life insurance producer, who has been duly licensed as a resident insurance producer with a life line of authority in this state or in such producer's home state for not less than one year and is licensed as a nonresident producer pursuant to section 38a-702g, shall be deemed to meet the licensing requirements of this section and shall be permitted to operate as a broker.
(d) Not later than thirty days after the first day of operating as a broker, a life insurance producer shall notify the commissioner that such producer is acting as a broker on a form prescribed by the commissioner, and shall pay a filing fee as specified in section 38a-11. Such notification shall include an acknowledgment by the life insurance producer that such producer shall operate as a broker in accordance with this part.
(e) The insurer that issued the policy that is the subject of a life settlement contract shall not be responsible for any act or omission of a broker, provider or purchaser arising out of or in connection with the life settlement transaction, unless the insurer receives compensation for the placement of a life settlement contract from the broker, provider or purchaser in connection with such life settlement contract.
(f) A person licensed as an attorney, certified public accountant or financial planner accredited by a nationally recognized accreditation agency, who is retained to represent the owner and whose compensation is not paid directly or indirectly by the provider or purchaser, may negotiate life settlement contracts on behalf of the owner without being required to obtain a license as a broker.
(g) Any license issued for a provider or broker shall be in force only until the last day of March in each year, but may be renewed by the commissioner without formality other than proper application. The fees for such licenses shall be assessed annually, as provided in section 38a-11. If such provider or broker fails to timely pay the renewal fee, such license shall be automatically revoked if the license fee is not received by the commissioner not later than the fifth day after the commissioner sends, by first class mail, a written notice of nonrenewal to the principal office of the provider or broker, provided such notice shall only be mailed after said last day of March.
(h) Upon the filing of an application and full payment of the license fee, the commissioner shall investigate the applicant and shall issue a license if the commissioner determines that:
(1) The applicant, if a provider, has provided a detailed plan of operation;
(2) The applicant is competent and trustworthy, and intends to act in good faith pursuant to the license applied for;
(3) The applicant has a good business reputation and adequate experience, training or education so as to be qualified in the business for which the license is applied;
(4) If the applicant is a corporation, partnership, limited liability company or other legal entity, the applicant is formed or organized pursuant to the laws of this state or is a foreign legal entity authorized to do business in this state, or provides a certificate of good standing from its state of domicile; and
(5) The applicant has provided to the commissioner an antifraud plan that meets the requirements of subsection (i) of section 38a-465j and includes:
(A) A description of the procedures for detecting and investigating possible fraudulent acts and procedures for resolving material inconsistencies between medical records and insurance applications;
(B) A description of the procedures for reporting fraudulent insurance acts to the commissioner;
(C) A description of the plan for antifraud education and training of its underwriters and other personnel; and
(D) A written description or chart outlining the arrangement of the antifraud personnel responsible for the investigation and reporting of possible fraudulent insurance acts and investigating unresolved material inconsistencies between medical records and insurance applications.
(i) The applicant shall provide to the commissioner such information as the commissioner may require, on forms approved by the commissioner. The commissioner may, at any time, require the applicant to fully disclose the identity of its stockholders, except stockholders owning less than ten per cent of the shares of an applicant whose shares are publicly traded, partners, officers and employees, and the commissioner may deny any application for a license if the commissioner determines that any partner, officer, employee or stockholder thereof who may materially influence the applicant's conduct fails to meet any of the standards set forth in sections 38a-465 to 38a-465q, inclusive.
(j) A license issued to a corporation, partnership, limited liability company or other legal entity authorizes all of such legal entity's members, officers and designated employees named in the application for such license, and any supplements to the application, to act as a licensee under such license.
(k) The commissioner shall not issue any license to any nonresident applicant unless a written designation of an agent for service of process is filed and maintained with the commissioner or unless the applicant has filed with the commissioner the applicant's written irrevocable consent that any action against the applicant may be commenced against the applicant by service of process on the commissioner.
(l) Each licensee shall file with the commissioner on or before the first day of March of each year an annual statement containing such information as the commissioner may prescribe by regulation.
(m) A provider shall not use any person to perform the functions of a broker, as defined in this part, unless such person holds a current, valid license as a broker and as provided in this section.
(n) A broker shall not use any person to perform the functions of a provider, as defined in this part, unless such person holds a current, valid license as a provider and as provided in this section.
(o) A provider or broker shall provide to the commissioner new or revised information about officers, stockholders holding ten per cent or more of the company's stock, partners, directors, members or designated employees not later than thirty days after the change in information.
(p) An individual licensed as a broker shall complete, on a biennial basis, fifteen hours of training related to life settlements and life settlement transactions, except that a life insurance producer operating as a broker pursuant to this section shall not be subject to the requirements of this subsection. Any person failing to meet the requirements of this subsection shall be subject to the penalties imposed by the commissioner.
(P.A. 97-202, S. 2, 18; P.A. 99-104, S. 3; 99-145, S. 5, 23; P.A. 03-152, S. 2; P.A. 08-175, S. 2; P.A. 09-74, S. 17; P.A. 10-5, S. 13.)
History: P.A. 97-202 effective January 1, 1998; P.A. 99-104 amended Subsec. (d) to include “members” among those whose identity may be disclosed, and to substitute “stockholder or member thereof who may materially influence the applicant's conduct fails to meet any of the standards set forth in sections 38a-465 to 38a-465m, inclusive” for “majority stockholder fails to meet any of the criteria set forth in subsection (f) of this section” re grounds for denial of license; P.A. 99-145 amended Subsec. (a) to substitute “Except as otherwise provided in this part” for “Except as provided in subsection (a) of section 38a-11, sections 38a-465 to 38a-465m, inclusive, and subdivision (19) of section 38a-816”, and substituted “subdivision (20) of section 38a-816” for “subdivision (19) of section 38a-816”, effective June 8, 1999; P.A. 03-152 added references to “viatical settlement investment agents”, made licensees subject to provisions of Secs. 38a-465n to 38a-465q, repositioned provisions of former Subsec. (f) to new Subsec. (c), revising therein Subdiv. (2) to substitute “license applied for” for “license” and Subdiv. (3) re qualification in the business for which the license is applied for, added new Subsec. (f) re new or revised information about officers, stockholders holding 10% or more of stock, partners, directors, members or designated employees, redesignated existing Subsecs. (c), (d), (e) and (g) as new Subsecs. (d), (e), (g) and (h), and made technical changes; P.A. 08-175 deleted provisions re viatical settlement throughout, made technical and conforming changes, deleted former Subsecs. (d), (f) and (h), redesignated existing Subsecs. (c), (e) and (g) as Subsecs. (i), (j) and (k), respectively, added new Subsecs. (c) and (d) re life insurance producer operating as a life settlement broker, added new Subsec. (e) re liability of an insurer for acts or omissions committed by a broker, provider or purchaser, added new Subsec. (f) re exemption of certain attorneys, certified public accountants or financial planners from licensing requirement, added new Subsecs. (g) and (h) re license renewals and payment of fees and added Subsecs. (l) to (q) re licensing, filing and training requirements; P.A. 09-74 made technical changes in Subsecs. (c) and (d), effective May 27, 2009; P.A. 10-5 deleted former Subsec. (h) re term and renewal of licenses and redesignated existing Subsecs. (i) to (q) as Subsecs. (h) to (p), effective May 5, 2010.

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