Public Act 90-0047 of the 90th General Assembly
Public Act 90-0047
HB0277 Enrolled LRB9000620LDdvA
AN ACT in relation to burial practices, amending named
Acts.
Be it enacted by the People of the State of Illinois,
represented in the General Assembly:
Section 5. The Illinois Funeral or Burial Funds Act is
amended by changing Section 1a-1 as follows:
(225 ILCS 45/1a-1)
Sec. 1a-1. Pre-need contracts.
(a) It shall be unlawful for any seller doing business
within this State to accept sales proceeds from a purchaser,
either directly or indirectly by any means, unless the seller
enters into a pre-need contract with the purchaser which
meets the following requirements:
(1) It states the name and address of the principal
office of the provider, or clearly discloses that the
provider will be selected by the purchaser or the
purchaser's survivor or legal representative at a later
date, except that no contract shall contain any provision
restricting the right of the contract purchaser during
his or her lifetime in making his or her own selection of
a provider.
(2) It clearly identifies the seller's name and
address, the purchaser and the beneficiary, if other than
the purchaser, and the provider, if different than the
seller or discloses that the provider will be selected at
a later date.
(3) It contains a complete description of the
funeral merchandise and services to be provided and the
price of the merchandise and services, and it clearly
discloses whether the price of the merchandise and
services is guaranteed or not guaranteed as to price.
(A) Each guaranteed price contract shall
contain the following statement in 12 point bold
type:
THIS CONTRACT GUARANTEES THE BENEFICIARY THE
SPECIFIC GOODS AND SERVICES CONTRACTED FOR. NO
ADDITIONAL CHARGES MAY BE REQUIRED. FOR DESIGNATED
GOODS AND SERVICES, ADDITIONAL CHARGES MAY BE
INCURRED FOR UNEXPECTED EXPENSES INCLUDING, BUT NOT
LIMITED TO, CASH ADVANCES, SHIPPING OF REMAINS FROM
A DISTANT PLACE, OR DESIGNATED HONORARIA ORDERED OR
DIRECTED BY SURVIVORS.
(B) Each non-guaranteed price contract shall
contain the following statement in 12 point bold
type:
THIS CONTRACT DOES NOT GUARANTEE THE PRICE THE
BENEFICIARY WILL PAY FOR ANY SPECIFIC GOODS OR
SERVICES. ANY FUNDS PAID UNDER THIS CONTRACT ARE
ONLY A DEPOSIT TO BE APPLIED TOWARD THE FINAL PRICE
OF THE GOODS OR SERVICES CONTRACTED FOR. ADDITIONAL
CHARGES MAY BE REQUIRED.
(4) It provides that if the particular supplies and
services specified in the pre-need contract are
unavailable at the time of delivery, the provider shall
be required to furnish supplies and services similar in
style and at least equal in quality of material and
workmanship.
(5) It discloses any penalties or restrictions,
including but not limited to geographic restrictions or
the inability of the provider, if selected, to perform,
on the delivery of merchandise, services, or pre-need
contract guarantees.
(6) Regardless of the method of funding the
pre-need contract, the following must be disclosed:
(A) Whether the pre-need contract is to be
funded by a trust, life insurance, or an annuity;
(B) The nature of the relationship among the
entity funding the pre-need contract, the provider,
if selected, and the seller;
(C) The impact on the pre-need contract of (i)
any changes in the funding arrangement including but
not limited to changes in the assignment,
beneficiary designation, or use of the funds; (ii)
any penalties to be incurred by the contract
purchaser as a result of failure to make payments;
(iii) penalties to be incurred or moneys or refunds
to be received as a result of cancellations; and
(iv) all relevant information concerning what occurs
and whether any entitlements or obligations arise if
there is a difference between the proceeds of the
particular funding arrangement and the amount
actually needed to pay for the funeral at-need; and
(D) The method of changing or selecting the
designation of the provider.
(b) All pre-need contracts are subject to the Federal
Trade Commission Rule concerning the Cooling-Off Period for
Door-to-Door Sales (16 CFR Part 429).
(c) No pre-need contract shall be sold in this State
unless there is a provider for the services and personal
property being sold, or unless disclosure has been made by
the seller as provided in subdivision (a)(1). If the seller
is not a provider and a provider has been selected, then the
seller must have a binding agreement with a provider, and the
identity of the provider and the nature of the agreement
between the seller and the provider shall be disclosed in the
pre-need contract at the time of the sale and before the
receipt of any sales proceeds. Any subsequent change made in
the identity of the provider shall be approved in writing by
the purchaser and beneficiary within 30 days after it occurs.
The failure to disclose the identity of the provider, the
nature of the agreement between the seller and the provider,
or any changes thereto to the purchaser and beneficiary, or
the failure to make the disclosures required in subdivision
(a)(1), constitutes an intentional violation of this Act.
(d) All pre-need contracts must be in writing and no
pre-need contract form shall be used without prior filing
with the Comptroller. The Comptroller shall review all
pre-need contract forms and shall prohibit the use of
contract forms which do not meet the requirements of this Act
upon written notification to the seller. Any use or
attempted use of any oral pre-need contract or any written
pre-need contract in a form not filed with the Comptroller or
in a form which does not meet the requirements of this Act
shall be deemed a violation of this Act. Life insurance
policies, tax-deferred annuities, endorsements, riders, or
applications for life insurance or tax-deferred annuities are
not subject to filing with the Comptroller. The Comptroller
may by rule develop a model pre-need contract form which
meets the requirements of this Act.
(e) The State Comptroller shall by rule develop a
booklet for consumers in plain English describing which
describes the statutory requirements, the different funding
mechanisms, and the scope, application, and consumer
protections of all disclosures required under this Act.
After the adoption of these rules, no pre-need contract shall
be sold in this State unless the seller distributes to the
purchaser prior to the sale a booklet promulgated or approved
for use by the State Comptroller.
(f) All sales proceeds received in connection with a
pre-need contract shall be deposited into a trust account as
provided in Section 1b and Section 2 of this Act, or shall be
used to purchase a life insurance policy or tax-deferred
annuity as provided in Section 2a of this Act.
(g) No pre-need contract shall be sold in this State
unless it is accompanied by a funding mechanism permitted
under this Act, and unless the seller is licensed by the
Comptroller as provided in Section 3 of this Act. Nothing in
this Act is intended to relieve sellers of pre-need contracts
from being licensed under any other Act required for their
profession or business, and being subject to the rules
promulgated to regulate their profession or business,
including rules on solicitation and advertisement.
(Source: P.A. 88-477.)
Section 10. The Cemetery Care Act is amended by changing
Section 1 as follows:
(760 ILCS 100/1) (from Ch. 21, par. 64.1)
Sec. 1. Short title. This Act may be cited shall be
known as the "Cemetery Care Act."
(Source: Laws 1947, p. 338.)
Section 15. The Illinois Pre-Need Cemetery Sales Act is
amended by changing Section 3 as follows:
(815 ILCS 390/3) (from Ch. 21, par. 203)
Sec. 3. Short title. This Act shall be known and may be
cited as the "Illinois Pre-Need Cemetery Sales Act".
(Source: P.A. 84-239.)