Application Process to Conduct Insurance Sales Activities

(1) General. A bank that is adequately capitalized, and has not been notified that it is in troubled condition or that it is significantly undercapitalized, or a lender that meets applicable statutory or regulatory net worth requirements, may engage in insurance sales activities under 209 CMR 49.00, by submitting an application to, and receiving approval from, the Commissioner; provided, however, that such bank or lender also applies for and receives a license as an insurance producer from the Division of Insurance pursuant to M.G. L. c. 175, § 209 and 211 CMR 142.00: Insurance Sales by Banks and Credit Unions,, before commencing insurance sales activities. (2) Application. A bank or lender must include in its application a complete description of its proposed insurance sales activities, its investment in such activity, and any other information the Commissioner may require. (3) Plan of Operation. A bank or lender shall submit a plan of operation to the Commissioner as part of the application process under 209 CMR 49.05. The plan of operation shall contain: (a) a detailed description of the applicant's consumer complaint resolution procedures, which shall include, but not be limited to, the names, addresses and telephone numbers of designated personnel responsible for its enforcement; a description of its procedures for forwarding copies of all consumer insurance sales complaints to the Office of Consumer Affairs pursuant to 209 CMR 49.06(10)(a); and a description of its procedures for the investigation and resolution of such complaints under 209 CMR 49.06(10)(c); (b) information demonstrating that the applicant meets the financial managerial, capital or net worth, policy and procedure, and other applicable eligibility requirements of 209 CMR 49.04; (c) information demonstrating that the applicant has established effective internal control procedures and safeguards to ensure compliance with the consumer protection terms and conditions prescribed by 209 CMR 49.06. (d) detailed information demonstrating that the applicant has established effective internal control procedures and safeguards against the unauthorized release, dissemination, or sharing of confidential customer information, including medical record information, protected by M.G.L. c. 175I, within the applicant's organization, including its affiliates, subsidiary corporations and third party vendors, as well as to third parties; and (e) a representation and undertaking that insurance sales activities will be conducted in accordance with 209 CMR 49.00, and all other applicable state and federal law. (4) Conditions. Any bank or lender granted an approval to conduct insurance sales activities pursuant to 209 CMR 49.05 is deemed to have agreed to conduct such activity in a manner consistent with applicable law, regulations and guidelines. The Commissioner may also impose additional conditions in connection with any approval granted under 209 CMR 49.05.