69K-7.0125. Alternative Form of Security for Permanent Outer Burial Receptacle Manufacturers

Effective on Sunday, October 6, 2019
  • 1(1) Pursuant to section 5497.283(2)(c), F.S., 7manufacturers of permanent outer burial receptacles shall be permitted to utilize the alternative form of security in connection with the sale of permanent outer burial receptacles sold to cemetery companies and funeral establishments in Florida. For purposes of this rule, a “permanent outer burial receptacle” as referred to in section 57497.283(2)(c), F.S., 59has the same meaning as an “outer burial container,” as defined in section 73497.005(55), F.S.

    75(2) The alternative form of security available to all permanent outer burial receptacle manufacturers who supply permanent outer burial receptacles to cemetery companies and funeral establishments in Florida, shall be in compliance with chapter 497, F.S., and shall provide for an Alternative Manufacturers’ Trust, together with a Manufacturers’ Delivery Surety/Guarantee, defined as follows:

    128(a) Alternative Manufacturers’ Trust.

    1321. An Alternative Manufacturers’ Trust (trust) may be established in the State of Florida by a permanent outer burial receptacle manufacturer or the Manufacturers’ Delivery Surety/Guarantor which trust shall be authorized to do business in Florida and shall be subject to interpretation, jurisdiction and venue in Florida under all applicable Florida laws. The trustee shall, with the Board’s approval, be selected by the manufacturer or the Manufacturers’ Delivery Surety/Guarantor.

    2012. Each deposit to the trust in connection with a pre-need sale of its product, shall be accounted for separately by the trustee and shall provide for quarterly valuation and pro-rata allocation of trust fund earnings and expenses during the period to each then outstanding trust account or sub-account;

    2503. The amount deposited as a result of each pre-need sales transaction will be made directly payable to the trust and shall be equal to one-hundred (100%) percent of the then existing manufacturer’s wholesale price. The funds shall remain in the trust until such time as they become available for disbursement under chapter 497, F.S., which disbursements shall be limited to the following:

    313a. The payment of trust expenses as provided in chapter 497, F.S.;

    325b. The refund of a trust deposit, which, in the event a pre-need contract purchaser elects to cancel his or her pre-need contract, shall be made to the manufacturer for delivery to the pre-need seller;

    360c. The payment by the trustee to the manufacturer after delivery at the time of need, upon submission to the trustee of a fully completed invoice for property delivered. Payment by the trustee out of the trust to the manufacturer shall be limited to the lesser of the manufacturers’ list price at the time of need or to the specific amount of funds in the trust allocated to the specifically identified account or sub-account relating to the invoice submitted;

    439d. The payment to the Department or Board in order to reimburse the Department or Board in the event the Department or Board is required to make payment in order to complete delivery at the time of need in response to purchaser’s claim, where the manufacturer has failed to make delivery of the permanent outer burial receptacle and the Manufacturers’ Delivery Surety/Guarantor has not performed pursuant to its Manufacturers’ Delivery Surety/Guarantee.

    510(b) Manufacturers’ Delivery Surety/Guarantee. In addition to the trust provided by this rule, a Manufacturers’ Delivery Surety/Guarantor shall execute and deliver to the pre-need seller a Manufacturers’ Delivery Surety/Guarantee which shall provide:

    5421. In the event that the manufacturer shall for any reason whatsoever not be able to deliver the permanent outer burial receptacle at the purchaser’s time of need, then in such event (prior to disposition of funds from the trust), the Manufacturers’ Delivery Surety/Guarantor shall deliver the permanent outer burial container at the time of need for the lesser of its then existing list price, or that portion of the trusted funds allocated to the specific trust account or sub-account.

    6222. In the event the Manufacturers’ Delivery Surety/Guarantor operating under this rule shall be unable to effect delivery or its operations are for any reason discontinued, the trust shall continue in operation but the Department shall take over as trustee for the trust. The trust shall no longer accept deposits on pre-need contract sales and all funds deposited in connection with all prior and outstanding contracts in which delivery was effected shall remain in trust until the terms of all outstanding contracts have been fully satisfied.

    708(c) Manufacturers’ Delivery Surety/Guarantor Qualification.

    7131. In order for any Manufacturers’ Delivery Surety/Guarantor to be considered for approval by the Board under this rule, such Manufacturers’ Delivery Surety/Guarantor shall be affiliated with a manufacturer doing business in Florida.

    7462. Any Manufacturers’ Delivery Surety/Guarantor approved by the Board who wishes to utilize this rule shall:

    762a. Obtain a certificate of approval from the Board to act as a Manufacturers’ Delivery Surety/Guarantor and to establish an Alternative Manufacturers’ Trust for the receipt of funds in Florida in connection with the sale of permanent outer burial receptacles sold on a pre-need basis;

    807b. File a copy of all forms, certificates, guarantees and trust agreements and all changes or modifications thereof, with the Department, for review as to legal sufficiency; and

    835c. Guarantee to the pre-need seller pursuant to this rule that its permanent outer burial receptacle products will be available for delivery at any time of need.

    8623. The Manufacturers’ Delivery Surety/Guarantee shall at all times assure an equivalent or better product will be delivered at the time of need. The Manufacturers’ Delivery Surety/Guarantee shall include as an exhibit, a list of the Manufacturers’ Delivery Surety/Guarantors’ product line. Said exhibit shall be updated on an annual basis with the Board by the approved manufacturer. With regard to the manufacturers’ wholesale or selling price, the manufacturer shall also file, on an annual basis, any changes in its wholesale or selling price with the Board.

    948Rulemaking Authority 950497.103, 951497.283(2)(c), 952497.458(1)(e) FS. 954Law Implemented 956497.103, 957497.283 FS. 959History–New 6-15-95, Amended 3-5-01, Formerly 3F-7.0125, Amended 10-6-19.