Terms Used In Montana Code > Title 33 > Chapter 20 - Life Insurance

• Amendment: A proposal to alter the text of a pending bill or other measure by striking out some of it, by inserting new language, or both. Before an amendment becomes part of the measure, thelegislature must agree to it.
• Annuity: A periodic (usually annual) payment of a fixed sum of money for either the life of the recipient or for a fixed number of years. A series of payments under a contract from an insurance company, a trust company, or an individual. Annuity payments are made at regular intervals over a period of more than one full year.
• Annuity: means a fixed annuity that is individually solicited, regardless of whether the product is classified as an individual or group annuity. See Montana Code 33-20-804
• Annuity issuer: means an insurer that has issued a contract to fund periodic payments under a structured settlement. See Montana Code 33-20-1402
• Assets: (1) The property comprising the estate of a deceased person, or (2) the property in a trust account.
• Beneficiary: A person who is entitled to receive the benefits or proceeds of a will, trust, insurance policy, retirement plan, annuity, or other contract. ^{Source: OCC}
• Bequest: Property gifted by will.
• Cash compensation: means any discount, concession, fee, service fee, commission, sales charge, loan, override, or cash benefit received by a producer in connection with the recommendation or sale of an annuity from an insurer, intermediary, or directly from the consumer. See Montana Code 33-20-804
• Complaint: A written statement by the plaintiff stating the wrongs allegedly committed by the defendant.
• Consideration: has the meaning provided in 28-2-801. See Montana Code 33-20-1402
• Consumer profile information: means information that is reasonably appropriate to determine whether a recommendation addresses the consumer's financial situation, insurance needs, and financial objectives, including, at a minimum, the following:

  (a)age;

  (b)annual income;

  (c)financial situation and needs, including debts and other obligations;

  (d)financial experience;

  (e)insurance needs;

  (f)financial objectives;

  (g)intended use of the annuity;

  (h)financial time horizon;

  (i)existing assets or financial products, including investment, annuity, and insurance holdings;

  (j)liquidity needs;

  (k)liquid net worth;

  (l)risk tolerance, including but not limited to willingness to accept nonguaranteed elements in the annuity;

  (m)financial resources used to fund the annuity; and

  (n)tax status. See Montana Code 33-20-804

• Contract: A legal written agreement that becomes binding when signed.
• Contract owner: means the owner named in the annuity contract or a certificate holder in the case of a group annuity contract. See Montana Code 33-20-904
• Conviction: A judgement of guilt against a criminal defendant.
• Corporation: A legal entity owned by the holders of shares of stock that have been issued, and that can own, receive, and transfer property, and carry on business in its own name.
• Customary: means according to usage. See Montana Code 1-1-206
• Damages: Money paid by defendants to successful plaintiffs in civil cases to compensate the plaintiffs for their injuries.
• Death master file: means the social security administration's death master file or any other database or service at least as comprehensive as the social security administration's death master file used for determining that a person has reportedly died. See Montana Code 33-20-1604
• Decedent: A deceased person.
• Dependent: A person dependent for support upon another.
• Determinable elements: means elements that are derived from processes or methods that are guaranteed at issue and are not subject to insurer discretion, but the values or amounts cannot be determined until some point after issue. See Montana Code 33-20-904
• Devise: To gift property by will.
• Discounted present value: means the present value of future payments determined by discounting the future payments to the present using the most recently published applicable federal rate for determining the present value of an annuity, as issued by the United States internal revenue service. See Montana Code 33-20-1402
• Donor: The person who makes a gift.
• Entitlement: A Federal program or provision of law that requires payments to any person or unit of government that meets the eligibility criteria established by law. Entitlements constitute a binding obligation on the part of the Federal Government, and eligible recipients have legal recourse if the obligation is not fulfilled. Social Security and veterans' compensation and pensions are examples of entitlement programs.
• Equitable: Pertaining to civil suits in "equity" rather than in "law." In English legal history, the courts of "law" could order the payment of damages and could afford no other remedy. See damages. A separate court of "equity" could order someone to do something or to cease to do something. See, e.g., injunction. In American jurisprudence, the federal courts have both legal and equitable power, but the distinction is still an important one. For example, a trial by jury is normally available in "law" cases but not in "equity" cases. ^{Source: U.S. Courts}
• Escheat: Reversion of real or personal property to the state when 1) a person dies without leaving a will and has no heirs, or 2) when the property (such as a bank account) has been inactive for a certain period of time. ^{Source: OCC}
• Escrow: Money given to a third party to be held for payment until certain conditions are met.
• Evidence: Information presented in testimony or in documents that is used to persuade the fact finder (judge or jury) to decide the case for one side or the other.
• Female: means a member of the human species who, under normal development, has XX chromosomes and produces or would produce relatively large, relatively immobile gametes, or eggs, during her life cycle and has a reproductive and endocrine system oriented around the production of those gametes. See Montana Code 1-1-201
• Fiduciary: A trustee, executor, or administrator.
• Financing entity: means an underwriter, placement agent, lender, or any entity, other than a nonaccredited investor, that has a direct ownership in a policy or certificate that is the subject of a viatical settlement contract, whose sole activity related to the transaction is the provision of funds to effect the viatical settlement contract, and who has an agreement in writing with one or more licensed viatical settlement providers. See Montana Code 33-20-1302
• Fiscal year: The fiscal year is the accounting period for the government. For the federal government, this begins on October 1 and ends on September 30. The fiscal year is designated by the calendar year in which it ends; for example, fiscal year 2006 begins on October 1, 2005 and ends on September 30, 2006.
• Fraud: Intentional deception resulting in injury to another.
• Generic name: means a short title descriptive of the annuity contract being applied for, such as "single premium deferred annuity". See Montana Code 33-20-904
• Gift: A voluntary transfer or conveyance of property without consideration, or for less than full and adequate consideration based on fair market value.
• Grace period: The number of days you'll have to pay your bill for purchases in full without triggering a finance charge. ^{Source: Federal Reserve}
• Gross advance amount: means the sum payable to the payee or to the payee's account as consideration for a transfer of a structured settlement payment right before any reduction for a transfer expense or any other deduction is made from the sum. See Montana Code 33-20-1402
• Guaranteed elements: means the premiums, credited interest rates (including any bonus), benefits, values, noninterest-based credits, and charges or elements of formulas used to determine any of these items that are guaranteed and determined at issue. See Montana Code 33-20-904
• Independent professional advice: means advice of an attorney, a certified public accountant, an actuary, or any licensed professional adviser. See Montana Code 33-20-1402
• insurance producer: means a person or entity required to be licensed under the laws of this state to sell, solicit, or negotiate insurance, including annuities. See Montana Code 33-20-804
• Insurer: means a company required to be licensed under the laws of this state to provide insurance products, including annuities. See Montana Code 33-20-804
• Interest rate: The amount paid by a borrower to a lender in exchange for the use of the lender's money for a certain period of time. Interest is paid on loans or on debt instruments, such as notes or bonds, either at regular intervals or as part of a lump sum payment when the issue matures. ^{Source: OCC}
• Interested party: means , with respect to a structured settlement, the payee, any beneficiary irrevocably designated under the annuity contract to receive a payment after the payee's death, the annuity issuer, the structured settlement obligor, or any other party that has a continuing right or obligation under the structured settlement. See Montana Code 33-20-1402
• Intermediary: means an entity contracted directly with an insurer or with another entity contracted with an insurer to facilitate the sale of the insurer's annuities by producers. See Montana Code 33-20-804
• Intestate: Dying without leaving a will.
• Judicial officers: means justices of the supreme court, judges of the district courts, justices of the peace, municipal judges, and city judges. See Montana Code 1-1-202
• Jurisdiction: (1) The legal authority of a court to hear and decide a case. Concurrent jurisdiction exists when two courts have simultaneous responsibility for the same case. (2) The geographic area over which the court has authority to decide cases.
• Knowingly: means only a knowledge that the facts exist which bring the act or omission within the provisions of this code. See Montana Code 1-1-204
• Liabilities: The aggregate of all debts and other legal obligations of a particular person or legal entity.
• Lien: A claim against real or personal property in satisfaction of a debt.
• Litigation: A case, controversy, or lawsuit. Participants (plaintiffs and defendants) in lawsuits are called litigants.
• Match: means a search of the death master file that results in a match of the social security number or the name and date of birth of an insured, annuitant, or retained asset account owner. See Montana Code 33-20-1604
• Net advance amount: means the gross advance amount minus the aggregate amount of the actual and estimated transfer expenses required to be disclosed under 33-20-1403(5). See Montana Code 33-20-1402
• Noncash compensation: means any form of compensation that is not cash compensation, including but not limited to health insurance, office rent, office support, and retirement benefits. See Montana Code 33-20-804
• Nonguaranteed elements: means the premiums, credited interest rates including any bonuses, benefits, values, dividends, noninterest-based credits, charges, or elements of formulas used to determine any of these that are subject to company discretion and are not guaranteed at issue. See Montana Code 33-20-804
• Nonguaranteed elements: means the premiums, credited interest rates (including any bonus), benefits, values, noninterest-based credits, and charges or elements of formulas used to determine any of these items that are subject to insurer discretion and are not guaranteed at issue. See Montana Code 33-20-904
• Obligation: An order placed, contract awarded, service received, or similar transaction during a given period that will require payments during the same or a future period.
• Partnership: A voluntary contract between two or more persons to pool some or all of their assets into a business, with the agreement that there will be a proportional sharing of profits and losses.
• Payee: means an individual who is receiving tax-free payments under a structured settlement and proposes to make a transfer of the payment rights. See Montana Code 33-20-1402
• Periodic payment: includes both a recurring payment and any scheduled future lump-sum payments. See Montana Code 33-20-1402
• Person: includes a corporation or other entity as well as a natural person. See Montana Code 1-1-201
• Policy: means a policy that provides a death benefit. See Montana Code 33-20-1604
• Precedent: A court decision in an earlier case with facts and law similar to a dispute currently before a court. Precedent will ordinarily govern the decision of a later similar case, unless a party can show that it was wrongly decided or that it differed in some significant way.
• Printing: means the act of reproducing a design on a surface by any process. See Montana Code 1-1-203
• Probation: A sentencing alternative to imprisonment in which the court releases convicted defendants under supervision as long as certain conditions are observed.
• Process: means a writ or summons issued in the course of judicial proceedings. See Montana Code 1-1-202
• Property: means real and personal property. See Montana Code 1-1-205
• Qualified assignment agreement: means an agreement providing for a qualified assignment, as defined for federal tax purposes, of the liability to make periodic payments under a structured settlement. See Montana Code 33-20-1402
• Recommendation: means advice provided by a producer to an individual consumer that was intended to result or does result in a purchase, an exchange, or a replacement of an annuity in accordance with that advice. See Montana Code 33-20-804
• Related provider trust: means a trust established by a licensed viatical settlement provider or a financing entity for the sole purpose of holding the ownership or beneficial interest in purchased policies in connection with a financing transaction. See Montana Code 33-20-1302
• Replacement: means a transaction in which a new annuity is to be purchased, and it is known or should be known to the proposing producer or to the proposing insurer, whether or not a producer is involved, that by reason of the transaction, an existing annuity or other insurance policy or contract has been or is to be any of the following:

  (a)lapsed, forfeited, surrendered or partially surrendered, assigned to the replacing insurer, or otherwise terminated;

  (b)converted to reduced paid-up insurance, continued as extended term insurance, or otherwise reduced in value by the use of nonforfeiture benefits or other policy values;

  (c)amended so as to effect either a reduction in benefits or in the term for which coverage would otherwise remain in force or for which benefits would be paid;

  (d)reissued with any reduction in cash value; or

  (e)used in a financed purchase. See Montana Code 33-20-804

• Rescission: The cancellation of budget authority previously provided by Congress. The Impoundment Control Act of 1974 specifies that the President may propose to Congress that funds be rescinded. If both Houses have not approved a rescission proposal (by passing legislation) within 45 days of continuous session, any funds being withheld must be made available for obligation.
• Responsible administrative authority: means , with respect to a structured settlement, any government authority vested by law with exclusive jurisdiction over the settled claim resolved by the structured settlement. See Montana Code 33-20-1402
• Service of process: The service of writs or summonses to the appropriate party.
• Settled claim: means the original tort claim. See Montana Code 33-20-1402
• Settlement: Parties to a lawsuit resolve their difference without having a trial. Settlements often involve the payment of compensation by one party in satisfaction of the other party's claims.
• Sex: means the organization of the body parts and gametes for reproduction in human beings and other organisms. See Montana Code 1-1-201
• Special purpose entity: means a corporation, partnership, trust, limited liability company, or other similar entity formed solely to provide, either directly or indirectly, access to institutional capital markets for a financing entity or licensed viatical settlement provider. See Montana Code 33-20-1302
• State: when applied to the different parts of the United States, includes the District of Columbia and the territories. See Montana Code 1-1-201
• Statute: A law passed by a legislature.
• Structured settlement: means an arrangement for periodic payment of damages for personal injuries or sickness established by settlement or judgment in resolution of a tort claim. See Montana Code 33-20-1402
• Structured settlement agreement: means the written agreement, judgment, stipulation, or release embodying the terms of a structured settlement. See Montana Code 33-20-1402
• Structured settlement obligor: means , with respect to a structured settlement, the party that has the continuing obligation to make periodic payments to the payee under a structured settlement agreement or a qualified assignment agreement. See Montana Code 33-20-1402
• Structured settlement payment right: means the right to receive periodic payments under a structured settlement, whether from the structured settlement obligor or the annuity issuer, when:

  (a)(i) the payee is domiciled in this state; or

  (ii)the domicile or principal place of business of the structured settlement obligor or the annuity issuer is located in this state;

  (b)a court or responsible administrative authority in this state approved the structured settlement agreement; or

  (c)the structured settlement agreement is expressly governed by the laws of this state. See Montana Code 33-20-1402

• Terms of the structured settlement: means , with respect to a structured settlement, the terms of the structured settlement agreement, the annuity contract, a qualified assignment agreement, or any order or other approval of a court or responsible administrative authority or other government authority that authorized or approved the structured settlement. See Montana Code 33-20-1402
• Tort: A civil wrong or breach of a duty to another person, as outlined by law. A very common tort is negligent operation of a motor vehicle that results in property damage and personal injury in an automobile accident.
• Transfer: means a sale, assignment, pledge, hypothecation, or other alienation or encumbrance of a structured settlement payment right made by a payee for consideration. See Montana Code 33-20-1402
• Transfer agreement: means the agreement providing for a transfer of a structured settlement payment right. See Montana Code 33-20-1402
• Transfer expenses: means all expenses of a transfer that are:

  (i)required under the transfer agreement to be paid by the payee; or

  (ii)deducted from the gross advance amount, including without limitation any court filing fee, attorney fee, escrow fee, lien recordation fee, judgment and lien search fee, finder's fee, commission, and other payments to a broker or other intermediary. See Montana Code 33-20-1402

• Transferee: means a party acquiring or proposing to acquire a structured settlement payment right through a transfer. See Montana Code 33-20-1402
• Trust account: A general term that covers all types of accounts in a trust department, such as estates, guardianships, and agencies. ^{Source: OCC}
• Trustee: A person or institution holding and administering property in trust.
• United States: includes the District of Columbia and the territories. See Montana Code 1-1-201
• Usual: means according to usage. See Montana Code 1-1-206
• Viatical settlement broker: means an individual who, for a fee, commission, or other consideration:

  (i)offers or advertises the availability of viatical settlement contracts;

  (ii)introduces holders of life insurance policies or certificates insuring the lives of individuals with a terminal illness or condition to viatical settlement providers; or

  (iii)offers or attempts to negotiate viatical settlement contracts between the policyholders or certificate holders and one or more viatical settlement providers. See Montana Code 33-20-1302

• Viatical settlement contract: means a written agreement establishing the terms under which compensation or anything of value will be paid, when the compensation or value is less than the expected death benefit of the insurance policy or certificate, in return for the viator's assignment, transfer, sale, devise, or bequest of the death benefit or ownership of any portion of the insurance policy or certificate of insurance. See Montana Code 33-20-1302
• Viatical settlement provider: means a person who solicits, enters into, or negotiates viatical settlement contracts or offers to enter into or negotiate viatical settlement contracts. See Montana Code 33-20-1302
• Viatical settlement purchase agreement: means a contract or agreement entered into by a viatical settlement purchaser with a viatical settlement provider to purchase a life insurance policy or an interest in a life insurance policy for the purpose of deriving an economic benefit. See Montana Code 33-20-1302
• Viatical settlement purchaser: means a person who, for the purpose of deriving an economic benefit:

  (i)gives consideration for a life insurance policy or an interest in the death benefits of a life insurance policy; or

  (ii)owns, acquires, or is entitled to a beneficial interest in a trust that owns a viatical settlement contract or that is the beneficiary of a life insurance policy that has been or will be the subject of a viatical settlement contract. See Montana Code 33-20-1302

• Viator: means the owner of a life insurance policy or the certificate holder under a group policy who enters or seeks to enter into a viatical settlement contract. See Montana Code 33-20-1302
• Writing: includes printing. See Montana Code 1-1-203