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1996 SESSION

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HB 897 Insurance; exempts certain charitable gift annuities from regulation.

Introduced by: Whittington W. Clement | all patrons    ...    notes | add to my profiles

SUMMARY:

Insurance; exemption of certain charitable gift annuities from regulation. Exempts qualified charitable gift annuities (and their issuance) from insurance regulation. The bill defines "charitable gift annuity" to mean an agreement by a charitable organization to make periodic payments in fixed dollar amounts payable over one or two lives in exchange for a transfer of cash or other property by a donor to such charitable organization. The actuarial value of the annuity is said to be less than the value of the cash or other property transferred; the difference in value constitutes a charitable deduction for federal tax purposes. Such an annuity is a qualified charitable gift annuity if it conforms to the requirements of enumerated provisions of the United States Internal Revenue Code, and if it is issued by a charitable organization that (i) has a minimum of $100,000 in cash, cash equivalents or other securities and (ii) has been in continuous operation for at least three years or is a successor to, or an affiliate of, a charitable organization in continuous operation for at least three years. Finally, the bill requires charitable organizations issuing such annuities to advise donors, in writing, that such annuity agreements are not insurance, and thus not subject to insurance regulation or the protections of the Virginia Life, Accident and Sickness Insurance Guaranty Association. The bill declares that its provisions stating that annuities are not insurance products and that their issuance is not engaging in the business of insurance or a violation of the insurance title's unfair trade practices chapter, are declarative of existing law.


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