§ 59A-49-2 — Purpose of article

Money for funeral and burial purposes usually comes from one or more sources, such as the proceeds of life insurance, allowances of governmental agencies, union and fraternal organization benefits and savings and estate funds. Sometimes funeral insurance is also sold for such purposes. Experience in this and other states has proven that contract payments for funeral insurance are customarily to be made within a short period of time as compared to the average lapse of time until performance of the funeral insurance; that during the long interval between full receipt of the purchase price and contract performance, the possibilities for fraud are great and risk of insolvency, with consequent inability to perform, are inherent; and that, in addition to regulation of funeral plans in the same manner as life insurance, providing for the establishment of trust funds to require reserves sufficient to assure the purchasers that the sellers of funeral plans will be able to complete their contracts when the time for performance arrives and other restrictions are required to protect the public welfare, health and safety. The purpose of this article is to regulate funeral plans and related matters as experience has proven necessary in order to protect against fraud and deceit and otherwise to accomplish and promote the protection and welfare of the public.

Legislative History

Laws 1984, ch. 127, § 900.