7 TAC §25.7
The Texas Department of Banking (the department) proposes
new §25.7, concerning the description of services and merchandise on
a prepaid funeral contract (the contract) regulated under Texas Civil Statutes,
Article 548b (the Act).
Express content guidelines for descriptions of services and merchandise
on the contract does not exist at present. Complete descriptions on the contract
are essential to the protection of consumers because the delivery of services
and merchandise usually occur many years after the contract is executed and
the people involved with the delivery generally are not the original parties
to the contract. Proposed new §25.7 would require that certain services
and merchandise descriptions appear on the contract and was developed in
cooperation with representatives of industry. The new section, if adopted,
will better ensure the purchaser's rights and interests are protected.
Stephanie Newberg, Director, Special Audits Division, Texas Department
of Banking, has determined that, for each year of the first five years the
section is in effect, there will be no fiscal implications for state or local
government as a result of enforcing or administering this section.
Ms. Newberg also has determined that, for each year of the first five years
the section is in effect, the public benefit anticipated as a result of its
adoption will be better protection of consumers resulting from better and
more consistent disclosures. No economic cost will be incurred by a person
required to comply with this section, and there will be no disparate effect
on small businesses.
Comments on the proposed section may be submitted in writing to Stephanie
Newberg, Director, Special Audits Division, Texas Department of Banking,
2601 North Lamar Boulevard, Austin, Texas 78705-4294.
The new section is proposed pursuant to rulemaking authority
under Texas Civil Statutes, Article 548b, §2, which authorizes the department
to prescribe reasonable rules and regulations concerning all matters incidental
to the enforcement and orderly administration of Article 548b.
Texas Civil Statutes, Article 548b, is affected by this proposed new section.
§25.7.Casket and Outer-Burial Containers.
(a)
Definitions. The following words and terms, when used in
this section, shall have the following meanings, unless the context clearly
indicates otherwise.
(1)
Casket--A rigid container, including but not limited to
casket inserts and rest beds, which is designed for the encasement of human
remains and which is usually constructed of wood, metal, fiberglass, plastic,
or like material, and ornamented and lined with fabric.
(2)
Contract--The prepaid funeral benefits contract.
(3)
Outer-burial container--Any container which is designed
for placement in the grave around the casket including, but not limited to,
containers commonly known as burial vaults, grave boxes, and grave liners.
The term "outer-burial container" does not include lawn crypts regulated
under the Texas Health and Safety Code, Chapters 711 and 712.
(4)
Urn--A temporary or permanent receptacle used for
the containment of cremated remains.
(b)
Descriptions.
(1)
Conformity of descriptions. The prepaid funeral benefits
contract must fully describe all services and merchandise purchased, including
the casket or urn and any outer-burial container, as required by this section.
(2)
Description content.
(A)
Caskets. The description of a casket under this section
must, at a minimum, include the following specifications:
(i)
The type of material that is predominately used in the
construction of the merchandise, i.e.:
(I)
steel, identified as stainless or by gauge, e.g., 18 gauge;
(II)
wood, identified by type, e.g., pecan or cherry;
(III)
bronze, described by weight or gauge, e.g., 32 oz. or
18 gauge;
(IV)
copper, described by weight or gauge, e.g., 32 oz. or
18 gauge; or
(V)
other specifically named material, e.g., as cardboard or
corrugated wood;
(ii)
The type of sealing feature, e.g., sealer, non-sealer,
or protective, if specified on the permit holder's price list; and,
(iii)
The material lining the interior of the casket, e.g.,
crepe, velvet, or silk.
(B)
Urns. The description of an urn under this section must,
at a minimum, include the type of material predominately used in its construction.
(C)
Outer-burial container. The description of an outer-burial
container under this section must, at a minimum, include the following specifications:
(i)
The type of material that is predominately used in the
construction of the merchandise, i.e.:
(I)
concrete, specifying type of construction, e.g., liner,
box, or vault;
(II)
steel, identified as stainless or by gauge, e.g., 12 gauge
(or described as galvanized of a particular gauge);
(III)
wood;
(IV)
bronze or copper, described by weight or gauge, e.g.,
32 oz. or 18 gauge;
(V)
other specifically named material; and
(ii)
The type of sealing feature, e.g., sealer, non-sealer,
or protective, if specified on the permit holder's price list.
(D)
Caskets, urns, and outer-burial containers. Merchandise
that is marketed as being of a particular content or fabrication, e.g., a
fiberglass liner, must be described under this section according to the particular
content or fabrication referenced i n marketing the product.
(E)
Optional disclosures. Except for information required
under this section, no additional description of caskets, urns, or outer
burial containers is required; however, relevant information, e.g., a model
number or color, may be added to a description at the election of the permit
holder.
(c)
Rule application. With respect to contracts entered prior
to the effective date of this section or the effective date of any amendment
to this section, a permit holder will not violate this section or such amendment
if it fails to comply with one or more requirements of this section or an
amendment that were not previously required by statute or rule.
This agency hereby certifies that the proposal has been reviewed
by legal counsel and found to be within the agency's legal authority to adopt.
Issued in Austin, Texas, on December 19, 1996.
TRD-9618443
Everette D. Jobe
General Counsel
Texas Department of Banking
Proposed date of adoption: February 3, 1997
For further information, please call: (512) 475-1300