Senate Bill No. 774
Senate Bill No. 774
PUBLIC ACT NO. 97-317
AN ACT CONCERNING THE SALE OF INSURANCE BY
CONNECTICUT BANKS AND OUT-OF-STATE BANKS.
Be it enacted by the Senate and House of
Representatives in General Assembly convened:
Section 1. Section 36a-250 of the general
statutes is repealed and the following is
substituted in lieu thereof:
(a) Except as otherwise provided in
[subsections (b) and (c)] SUBSECTION (b) of this
section, a Connecticut bank may:
(1) Transact a general banking business and
exercise by its governing board or duly authorized
officers or agents, subject to applicable law, all
such incidental powers as are necessary thereto.
The express powers authorized for a Connecticut
bank under subdivisions (2) to (38), inclusive, of
this subsection do not preclude the existence of
additional powers deemed to be incidental to the
transaction of a general banking business pursuant
to this subdivision;
(2) (A) Receive deposits as authorized by and
subject to the provisions of sections 36a-290 to
36a-305, inclusive, section 36a-307, sections
36a-315 to 36a-323, inclusive, and sections
36a-330 to 36a-338, inclusive, including: (i)
Savings deposits; (ii) time deposits; (iii) demand
deposits; (iv) public funds or money held in a
fiduciary capacity; (v) school savings funds; and
(vi) club deposits; and (B) pay interest or
dividends thereon;
(3) Act as a depository of court and trust
funds;
(4) Receive for safekeeping or otherwise all
kinds of personal property, including papers,
documents and evidences of indebtedness;
(5) Conduct a safe deposit business on its
banking premises;
(6) Act (A) as guardian or conservator of the
estate of any person, but not of the person, (B)
as a trustee, receiver, executor or administrator,
or (C) in any other fiduciary capacity, all
without bond unless a bond is ordered by the
court;
(7) Act as agent or attorney in fact for the
holders of securities or the owners of real
estate;
(8) Act as transfer agent or registrar of
stocks and bonds;
(9) Execute and deliver signature guaranties
as may be incidental or usual in the transfer of
investment securities;
(10) Act as agent, fiscal agent or trustee for
any corporation or for holders of bonds, notes or
other securities, and pledge assets to secure
deposits in its banking department when (A) made
by it as trustee under a trust indenture for the
holders of revenue bonds issued by this state, any
municipality, district, municipal corporation or
authority or political subdivision thereof, and
the express provisions of the authority or its
political subdivision, and the express provisions
of the trust indenture require the deposit to be
so secured, (B) made by it as fiscal agent for a
housing authority in connection with a
federally-assisted housing project and federal
regulations or other requirements call for the
deposits to be so secured or (C) made by it to
secure deposits in individual retirement accounts
and qualified retirement plan accounts,
established in accordance with the applicable
provisions of the Internal Revenue Code of 1986,
or any prior or subsequent corresponding internal
revenue code of the United States, as from time to
time amended, where such deposits exceed the
maximum of federal deposit insurance available for
such accounts;
(11) Act as fiscal agent for this state or any
of its political subdivisions when authorized by
the executive head of this state or of the
political subdivision;
(12) Act as agent (A) in the collection of
taxes for any qualified treasurer of any taxing
district or qualified collector of taxes or (B)
for any electric, gas, water or telephone company
operating within this state in receiving moneys
due that company for utility services furnished by
it;
(13) Act as agent for the sale, issue and
redemption of obligations of the United States and
pledge assets to the United States or to the
proper federal reserve bank for its obligations as
that agent;
(14) (A) Act as agent for an insured
depository institution affiliate in receiving
deposits, renewing time deposits, closing loans,
servicing loans and receiving payments on loans
and other obligations, and in so doing shall not
be considered to be a branch of such affiliate;
(B) A Connecticut bank may not conduct any
activity as an agent under subparagraph (A) of
this subdivision which such bank is prohibited
from conducting as a principal;
(15) Act as treasurer of any organization
exempt from federal income taxation under Section
501 of the Internal Revenue Code of 1986, or any
subsequent corresponding internal revenue code of
the United States, as from time to time amended;
(16) Establish a charitable fund, either in
the form of a charitable trust or a nonprofit
corporation to assist in making charitable
contributions, provided (A) the trust or nonprofit
corporation is exempt from federal income taxation
and may accept charitable contributions under
Section 501 of the Internal Revenue Code of 1986,
or any subsequent corresponding internal revenue
code of the United States, as from time to time
amended, (B) the trust or nonprofit corporation's
operations shall be disclosed fully to the
commissioner upon request, and (C) the trust
department of the bank or one or more directors or
officers of the bank act as trustees or directors
of the fund;
(17) In the discretion of a majority of its
governing board, make contributions or gifts to or
for the use of any corporation, trust or community
chest, fund or foundation created or organized
under the laws of the United States or of this
state and organized and operated exclusively for
charitable, educational or public welfare
purposes, or of any hospital which is located in
this state and which is exempt from federal income
taxes and to which contributions are deductible
under Section 501(c) of the Internal Revenue Code
of 1986, or any subsequent corresponding internal
revenue code of the United States, as from time to
time amended;
(18) Discount, purchase and sell accounts
receivable, negotiable and nonnegotiable
promissory notes, drafts, bills of exchange and
other forms of indebtedness;
(19) (A) Accept for payment at future dates
drafts drawn upon it, and (B) except as provided
in section 36a-299, sell or issue without charge
negotiable checks or drafts drawn by or on the
bank. Negotiable checks or drafts drawn, sold or
issued by a bank may be drawn on that bank or be
payable by or through another bank or out-of-state
bank;
(20) Make secured and unsecured loans and
issue letters of credit as authorized by and
subject to section 36a-260;
(21) (A) Issue credit cards and debit cards
and enter into card agreements with the bank's
card holders and with other card issuers, (B) lend
money to individuals, honor drafts and similar
orders drawn or accepted, whether by written
instrument or electronic transmission, and pay and
agree to pay obligations incurred in connection
with those agreements, (C) become affiliated with
any credit card corporation or association, and
(D) subject to sections 36a-155 to 36a-159,
inclusive, where applicable, provide electronic
fund transfer facilities and services and enter
into agreements with customers and other persons
regarding the provision of such facilities;
(22) Provide home banking services to
customers as provided in section 36a-170;
(23) Contract for and pay the premiums upon
life insurance in the amount of the unpaid balance
due on loans;
(24) Borrow money and pledge assets therefor,
and pledge assets to secure trust funds on deposit
awaiting investment;
(25) Enter into leases of personal property
acquired upon the specific request of and for the
use of a prospective lessee;
(26) Make investments as authorized by this
title;
(27) Sell to any person, including any state
or federal agency or instrumentality, any loan or
group of loans legally owned by the bank,
repurchase any such loan or group of loans, and
act as collecting, remitting and servicing agent
in connection with any such loans and charge for
its acts as agent. Any such bank is authorized to
purchase the minimum amount of capital stock of
the applicable agency or instrumentality if
required by that entity to be purchased in
connection with the assignment of loans to that
entity and to hold and dispose of that stock;
(28) With the approval of the commissioner,
deal in and underwrite, to the same extent as is
permitted to a national banking association,
obligations of: (A) The United States or any of
its agencies; (B) any state or any political
subdivision or instrumentality of the state or (C)
Canada, any province of Canada or any political
subdivision of Canada;
(29) Issue and sell securities which (A) are
guaranteed by the Federal National Mortgage
Association or any other agency or instrumentality
authorized by state or federal law to create a
secondary market with respect to loans of the type
originated by the bank, or (B) subject to the
approval of the commissioner, relate to loans
originated by the bank and are guaranteed or
insured by a financial guaranty insurance company
or comparable private entity;
(30) Subject to the approval of the
commissioner, authorize the issuance and sale of
evidences of indebtedness, including debentures,
debt instruments of all maturities and capital
notes, at such times, in such amount and upon such
terms as are determined by the governing board,
provided the issuance of such evidences of
indebtedness which are payable on demand or mature
within five years of their issuance or which are
effected in the ordinary course of business do not
require the approval of the commissioner. The
proceeds of such evidences of indebtedness which
mature after five years of their issuance which
are subordinate to the claims of depositors upon
liquidation of the bank shall be considered part
of its capital for the purpose of computing any
loan, deposit or investment limitation under this
title;
(31) With the approval of and upon such
conditions and under such regulations as may be
prescribed or adopted by the commissioner,
establish and maintain one or more mutual funds
and offer to the public shares or participations
therein;
(32) With the written approval of the
commissioner: (A) Acquire, alter or improve real
estate for present or future use in the business
of the bank, except that approval of the
commissioner is not necessary in case of the
alteration or improvement of real estate already
owned by the bank or a corporation controlled by
it as provided in subsection (d) of section
36a-276, if the expenditure for such purposes does
not in any one calendar year exceed five per cent
of the bank's equity capital and reserves for loan
and lease losses or five hundred thousand dollars,
whichever is less; (B) purchase real estate
adjoining any parcel of real estate then owned by
it and acquired in the usual course of business,
provided the aggregate of all investments and
loans authorized in subparagraphs (A) and (B) of
this subdivision and in the equipment used by such
bank in its operations, together with the amount
of any indebtedness incurred by any corporation
holding real estate of the bank and such bank's
proportionate share, computed according to stock
ownership, of any indebtedness incurred by any
service corporation, does not exceed fifty per
cent of the equity capital and reserves for loan
and lease losses of the bank, unless the
commissioner finds that the rental income from any
part of the premises not occupied by the bank will
be sufficient to warrant larger investment;
(33) Convey any real estate owned by it at the
price and upon such terms of payment as its
governing board or an authorized committee thereof
determines and sets forth in the bank's records.
If any such sale is wholly or partly for credit, a
note secured by a first mortgage on the real
estate may evidence that credit. With the written
approval of the commissioner, the bank may accept
other real estate in whole or in part for any such
conveyance;
(34) Establish and maintain an international
banking facility, as defined in regulations
adopted by the Board of Governors of the Federal
Reserve System, subject to such regulations as the
commissioner may adopt, in accordance with chapter
54, to specify, and impose restrictions upon, the
types of activities in which the international
banking facility may engage;
(35) Join the Federal Reserve System;
(36) With the approval of the commissioner,
join the Federal Home Loan Bank System and borrow
funds as provided under federal law;
(37) Even if not expressly authorized to
exercise fiduciary powers, act as trustee or
custodian of a plan which qualifies as part of a
retirement plan for self-employed individuals or
an individual retirement account under the
provisions of the Internal Revenue Code of 1986,
or any subsequent corresponding internal revenue
code of the United States, as from time to time
amended, if the governing instrument limits the
investment of the funds held pursuant to such plan
to the following investments: (1) Savings deposits
and time deposits; and (2) with respect to
retirement plans for self-employed individuals,
notes of members in such plans which evidence the
indebtedness of such members for funds borrowed
from the plans. Funds held pursuant to any plan
which so qualifies may be deposited in any
Connecticut bank without regard to any statutory
limit on the amount which such bank may have on
deposit from one depositor;
(38) Sell INSURANCE AND fixed and variable
annuities directly, [or] sell INSURANCE AND such
annuities indirectly through [an affiliate or] A
subsidiary, OR ENTER INTO ARRANGEMENTS WITH
THIRD-PARTY MARKETING ORGANIZATIONS FOR THE SALE
BY SUCH THIRD-PARTY MARKETING ORGANIZATIONS OF
INSURANCE OR SUCH ANNUITIES ON THE PREMISES OF THE
CONNECTICUT BANK OR TO CUSTOMERS OF THE
CONNECTICUT BANK; provided (A) such INSURANCE AND
annuities are ISSUED OR purchased BY OR from an
insurance company licensed in accordance with
section 38a-41, and (B) the Connecticut bank,
[affiliate or] subsidiary OR THIRD-PARTY MARKETING
ORGANIZATION, and any officer or employee thereof,
shall be licensed [in accordance with] AS REQUIRED
BY section 38a-769 before engaging in any of the
activities authorized by this subdivision. As used
in this subdivision, "annuities" [has the meaning
given to that term] AND "INSURANCE" HAVE THE SAME
MEANINGS AS SET FORTH in section 38a-1, EXCEPT
THAT "INSURANCE" DOES NOT INCLUDE TITLE INSURANCE.
The provisions of this subdivision do not
authorize a Connecticut bank [, affiliate] or A
subsidiary OF A CONNECTICUT BANK to underwrite
INSURANCE OR annuities.
[(b) Except as otherwise provided under this
section and section 36a-285, no Connecticut bank
shall engage in the business of marine, fire or
life insurance, or fidelity, surety, accident,
health, liability, credit, title or other form of
casualty insurance. This subsection shall not
apply to any corporation actually engaged on
January 1, 1907, in the business of a title
insurance and guarantee company, so far as the
right of such company to continue the business of
title insurance and guarantee is concerned.]
[(c)] (b) A Connecticut bank which is
organized to function solely in a fiduciary
capacity shall not be authorized to exercise any
of the powers enumerated in this section to the
extent that such exercise would cause it to
function otherwise than in a fiduciary capacity,
including, but not limited to, receiving or
holding deposits of any kind, other than in a
fiduciary capacity, or making loans or otherwise
extending credit, other than in a fiduciary
capacity.
[(d)] (c) A Connecticut bank which is
authorized to exercise fiduciary powers pursuant
to subsection (a) of this section shall exercise
such powers in compliance with the provisions of
sections 36a-350 to 36a-353, inclusive, 36a-365 to
36a-372, inclusive, 36a-380 to 36a-386, inclusive,
and 36a-395 to 36a-399, inclusive.
Sec. 2. Section 38a-702 of the general
statutes is repealed and the following is
substituted in lieu thereof:
In sections 38a-703 to 38a-706, inclusive,
38a-769 [,] AND 38a-774, [and 38a-775,] unless the
context or subject matter otherwise requires:
(1) "Insurance producer" or "producer" means
any person, partnership, association, limited
liability company or corporation, or any person,
partnership, association, limited liability
company or corporation acting under a trade name,
or any member, stockholder, officer or employee of
such an entity, holding a producer's license then
in force in this state, and which, for
compensation, aids in any manner or acts as a
representative on behalf of an insured or client,
and who solicits and negotiates coverage of
insurance for the public without an agreement or
contract with any specific insurance company, and
not as an officer, traveling salaried employee or
appointed agent of the insurance company, or a
licensed producer holding an agent's appointment.
A producer's license shall not be used as a
substitute for an agent's appointment;
(2) "Insurance agent" means a person,
partnership, association, limited liability
company or corporation, or any person,
partnership, association, limited liability
company or corporation acting under a trade name,
holding an insurance producer's license then in
force in this state and a direct appointment in
writing, by any insurance company authorized to
transact business in this state, to solicit,
negotiate or effect contracts of insurance,
annuities or surety on behalf of such company or
any manager of a limited liability company or any
member, stockholder, officer or agent of a
partnership, association, limited liability
company or corporation, or partnership,
association, limited liability company or
corporation acting under a trade name when that
individual is engaged in soliciting, negotiating
or effecting such contracts. "Insurance agent"
shall not include persons acting as executive
officers or traveling salaried employees of an
insurance company authorized to transact business
in this state.
Sec. 3. Section 38a-775 of the general
statutes is repealed and the following is
substituted in lieu thereof:
[(a) As used in this section: (1) "Lending
institution" means any institution that accepts
deposits and lends money, including banks, savings
and loan associations and credit unions, but not
including insurance companies; (2) "affiliate",
"subsidiary" and related terms shall be defined as
in section 38a-1; (3) "bank holding company" means
and includes the definition of such term in
Section 2 of an Act of Congress entitled the "Bank
Holding Company Act of 1956", as amended from time
to time; (4) "commissioner" means the Insurance
Commissioner.
(b) No license authorizing the sale of fire
and casualty insurance shall be issued pursuant to
section 38a-769 to (1) a lending institution, or
(2) a bank holding company, subsidiary or
affiliate of a lending institution, or (3) an
officer or employee of such lending institution,
bank holding company, subsidiary or affiliate,
provided this subsection shall not apply to any
such person or organization which was lawfully
licensed to sell fire and casualty insurance on
October 1, 1973.
(c) No license authorizing the sale of life
and health insurance shall be issued pursuant to
section 38a-769 to (1) a lending institution, or
(2) a bank holding company, subsidiary or
affiliate of a lending institution, provided this
subsection shall not apply to any such
organization which was lawfully licensed to sell
life and health insurance on October 1, 1980, to
any savings bank with respect to the sale of life
insurance policies or annuity contracts issued
pursuant to section 36a-285, except that an
affiliate of a bank which was a nonbank before the
passage of the Competitive Equality Banking Act of
1987 and the new ownership of such nonbank was
approved by the Commissioner of Banking under
section 36a-181 or 36a-185 on or before May 8,
1984, may be issued a license authorizing the sale
of life insurance. Life and health insurance shall
not include credit life insurance as defined in
section 38a-646 or group life and disability
insurance sold in connection with real estate
mortgage loans.
(d) Notwithstanding the provisions of
subsection (c) of this section, a license
authorizing the sale of fixed and variable
annuities may be issued by the commissioner
pursuant to section 38a-769 to (1) a bank, as
defined in section 36a-2, (2) an out-of-state
bank, as defined in section 36a-2, that maintains
in this state a branch, as defined in section
36a-410, or (3) a subsidiary, affiliate, officer
or employee of such bank or out-of-state bank. The
Insurance Commissioner shall adopt regulations, in
accordance with the provisions of chapter 54, to
carry out the purposes of this subsection. Said
regulations shall include, but not be limited to
the following requirements: (A) Any bank,
out-of-state bank or subsidiary or affiliate of
such bank or out-of-state bank shall disclose that
an annuity is not insured or guaranteed by any
state or federal agency; (B) no bank, out-of-state
bank or subsidiary or affiliate of such bank or
out-of-state bank may require or imply that a
customer or prospective customer must purchase an
annuity as a condition to receiving any other
product or service offered by such bank,
out-of-state bank or subsidiary or affiliate of
such bank or out-of-state bank; and (C) any bank,
out-of-state bank or subsidiary or affiliate of
such bank or out-of-state bank shall be prohibited
from providing any financial records, as defined
in section 36a-41, to any person for the purpose
of selling annuities without the prior written
consent of the customer.
(e) The Insurance Commissioner may adopt
regulations, in accordance with the provisions of
chapter 54, in order to effectuate the purposes of
this section.]
(a) AS USED IN THIS SECTION:
(1) "BANK" HAS THE SAME MEANING AS SET FORTH
IN SECTION 36a-2, BUT DOES NOT INCLUDE A TRUST
COMPANY THAT DOES NOT ACCEPT FEDERALLY INSURED
DEPOSITS AND DOES NOT ENGAGE IN INSURANCE SALES OR
SOLICITATION ACTIVITIES, EITHER DIRECTLY OR
INDIRECTLY THROUGH A THIRD-PARTY MARKETING
ORGANIZATION, THAT WOULD REQUIRE SUCH TRUST
COMPANY TO OBTAIN AN INSURANCE PRODUCER'S LICENSE
UNDER THE LAWS OF THIS STATE;
(2) "OUT-OF-STATE BANK" HAS THE SAME MEANING
AS SET FORTH IN SECTION 36a-2, PROVIDED THE
INSTITUTION (A) MAINTAINS IN THIS STATE A BRANCH,
AS DEFINED IN SECTION 36a-410, OR (B) ENGAGES IN
INSURANCE SALES OR SOLICITATION ACTIVITIES, EITHER
DIRECTLY OR INDIRECTLY THROUGH A THIRD-PARTY
MARKETING ORGANIZATION, THAT WOULD REQUIRE THE
INSTITUTION TO OBTAIN AN INSURANCE PRODUCER'S
LICENSE UNDER THE LAWS OF THIS STATE, BUT DOES NOT
INCLUDE A TRUST COMPANY THAT DOES NOT ACCEPT
FEDERALLY INSURED DEPOSITS AND DOES NOT ENGAGE IN
INSURANCE SALES OR SOLICITATION ACTIVITIES, EITHER
DIRECTLY OR INDIRECTLY THROUGH A THIRD-PARTY
MARKETING ORGANIZATION, THAT WOULD REQUIRE SUCH
TRUST COMPANY TO OBTAIN AN INSURANCE PRODUCER'S
LICENSE UNDER THE LAWS OF THIS STATE;
(3) "SUBSIDIARY" HAS THE SAME MEANING AS SET
FORTH IN SECTION 36a-2;
(4) "INSURANCE" HAS THE SAME MEANING AS SET
FORTH IN SECTION 38a-1, BUT DOES NOT INCLUDE TITLE
INSURANCE;
(5) "CUSTOMER" MEANS ANY PERSON WHO
ESTABLISHES A DEPOSIT, TRUST, INVESTMENT, LOAN OR
CREDIT ACCOUNT WITH A BANK, OUT-OF-STATE BANK OR
SUBSIDIARY OF SUCH BANK OR OUT-OF-STATE BANK;
(6) "INSURANCE INFORMATION" MEANS COPIES OF,
OR THE INFORMATION CONTAINED IN, INSURANCE
POLICIES, BINDERS, RATES, DECLARATION PAGES AND
EXPIRATION DATES THAT ARE ACQUIRED BY A BANK,
OUT-OF-STATE BANK OR SUBSIDIARY OF SUCH BANK OR
OUT-OF-STATE BANK IN CONNECTION WITH ITS LENDING
ACTIVITIES; AND
(7) "INSURANCE PRODUCER" HAS THE SAME MEANING
AS SET FORTH IN SECTION 38a-702, AS AMENDED BY
SECTION 2 OF THIS ACT.
(b) ANY BANK, OUT-OF-STATE BANK OR SUBSIDIARY
OF SUCH BANK OR OUT-OF-STATE BANK ENGAGED IN THE
SALE OF ANNUITIES OR LIFE INSURANCE IN THIS STATE,
OR ANY LICENSED INSURANCE PRODUCER THAT SELLS
ANNUITIES OR LIFE INSURANCE RECOMMENDED OR
SPONSORED BY OR ON THE PREMISES IN THIS STATE OF A
BANK, OUT-OF-STATE BANK OR SUBSIDIARY OF SUCH BANK
OR OUT-OF-STATE BANK, SHALL DISCLOSE IN WRITING
PRIOR TO OR AT THE TIME AN ANNUITY OR LIFE
INSURANCE PRODUCT IS PURCHASED, IN ANY
ADVERTISEMENT OR PROMOTIONAL MATERIAL SOLICITING
SALES OF ANNUITIES OR LIFE INSURANCE PRODUCTS, AND
ORALLY DURING ANY SALES PRESENTATION, THAT ANY
ANNUITY OR LIFE INSURANCE PRODUCT OFFERED,
RECOMMENDED, SPONSORED OR SOLD (1) IS NOT A
DEPOSIT, (2) IS NOT INSURED BY THE FEDERAL DEPOSIT
INSURANCE CORPORATION, (3) IS NOT GUARANTEED BY
THE BANK OR OUT-OF-STATE BANK, AND (4) WHERE
APPROPRIATE, INVOLVES INVESTMENT RISK, INCLUDING
POTENTIAL LOSS OF PRINCIPAL. ANY BANK,
OUT-OF-STATE BANK OR SUBSIDIARY OF SUCH BANK OR
OUT-OF-STATE BANK THAT DOES NOT ACCEPT INSURED
DEPOSITS SHALL NOT BE REQUIRED TO PROVIDE THE
DISCLOSURES REQUIRED BY SUBDIVISIONS (1), (2) AND
(3) OF THIS SUBSECTION.
(c) (1) NO BANK, OUT-OF-STATE BANK OR
SUBSIDIARY OF SUCH BANK OR OUT-OF-STATE BANK
ENGAGED IN THE SALE OF ANNUITIES OR INSURANCE IN
THIS STATE, AND NO LICENSED INSURANCE PRODUCER
THAT SELLS ANNUITIES OR INSURANCE RECOMMENDED OR
SPONSORED BY OR ON THE PREMISES IN THIS STATE OF A
BANK, OUT-OF-STATE BANK OR SUBSIDIARY OF SUCH BANK
OR OUT-OF-STATE BANK, MAY REQUIRE OR IMPLY THAT A
CUSTOMER OR PROSPECTIVE CUSTOMER MUST PURCHASE AN
ANNUITY OR INSURANCE POLICY FROM SUCH BANK,
OUT-OF-STATE BANK OR SUBSIDIARY OF SUCH BANK OR
OUT-OF-STATE BANK AS A CONDITION TO RECEIVING ANY
OTHER PRODUCT OR SERVICE OFFERED BY SUCH BANK,
OUT-OF-STATE BANK OR SUBSIDIARY OF SUCH BANK OR
OUT-OF-STATE BANK. FOR PURPOSES OF THIS
SUBDIVISION, "OTHER PRODUCT OR SERVICE" DOES NOT
INCLUDE FINANCING IN CONNECTION WITH INSURANCE
PRODUCTS BEING OFFERED OR SOLD.
(2) ANY BANK, OUT-OF-STATE BANK OR SUBSIDIARY
OF SUCH BANK OR OUT-OF-STATE BANK THAT MAKES LOANS
OR OTHER EXTENSIONS OF CREDIT AND ENGAGES IN THE
SALE OF INSURANCE IN THIS STATE, OR ANY LICENSED
INSURANCE PRODUCER THAT SELLS ANNUITIES OR
INSURANCE RECOMMENDED OR SPONSORED BY OR ON THE
PREMISES IN THIS STATE OF A BANK, OUT-OF-STATE
BANK OR SUBSIDIARY OF SUCH BANK OR OUT-OF-STATE
BANK, SHALL DISCLOSE TO CUSTOMERS, IN CONNECTION
WITH A LOAN OR OTHER EXTENSION OF CREDIT WHERE
INSURANCE IS OFFERED BY SUCH BANK, OUT-OF-STATE
BANK OR SUBSIDIARY OF SUCH BANK OR OUT-OF-STATE
BANK, THAT INSURANCE MAY BE PURCHASED FROM AN
INSURANCE PRODUCER OF THE CUSTOMER'S CHOICE AND
THAT THE CUSTOMER'S CHOICE OF ANOTHER INSURANCE
PRODUCER SHALL NOT AFFECT THE CREDIT DECISION OF
THE BANK, OUT-OF-STATE BANK OR SUBSIDIARY OF SUCH
BANK OR OUT-OF-STATE BANK. FOR PURPOSES OF THIS
SUBDIVISION, "LOAN OR EXTENSION OF CREDIT" DOES
NOT INCLUDE FINANCING IN CONNECTION WITH INSURANCE
PRODUCTS BEING OFFERED OR SOLD.
(3) IF ANY INSURANCE, OTHER THAN CREDIT LIFE
AND DISABILITY INSURANCE, IS REQUIRED AS A
CONDITION OF OBTAINING A LOAN FROM ANY BANK,
OUT-OF-STATE BANK OR SUBSIDIARY OF SUCH BANK OR
OUT-OF-STATE BANK THAT MAKES LOANS OR OTHER
EXTENSIONS OF CREDIT AND ENGAGES IN THE SALE OF
INSURANCE IN THIS STATE, THE CREDIT TRANSACTION
AND THE INSURANCE TRANSACTION SHALL BE COMPLETED
INDEPENDENTLY AND THROUGH SEPARATE DOCUMENTS.
(d) (1) NO BANK, OUT-OF-STATE BANK OR
SUBSIDIARY OF SUCH BANK OR OUT-OF-STATE BANK
ENGAGED IN THE SALE OF ANNUITIES OR INSURANCE IN
THIS STATE MAY PROVIDE ANY FINANCIAL RECORDS, AS
DEFINED IN SECTION 36a-41, TO ANY PERSON FOR THE
PURPOSE OF SELLING ANNUITIES OR INSURANCE WITHOUT
THE PRIOR WRITTEN CONSENT OF THE CUSTOMER TO WHOM
SUCH FINANCIAL RECORDS PERTAIN.
(2) NO BANK, OUT-OF-STATE BANK OR SUBSIDIARY
OF SUCH BANK OR OUT-OF-STATE BANK ENGAGED IN THE
SALE OF ANNUITIES OR INSURANCE IN THIS STATE MAY
USE ANY INSURANCE INFORMATION TO SOLICIT OR SELL
INSURANCE TO CUSTOMERS, OR PROVIDE ANY INSURANCE
INFORMATION TO A THIRD PARTY IN CONNECTION WITH
THE THIRD PARTY'S SOLICITATION OR SALE OF
INSURANCE TO CUSTOMERS, WITHOUT THE PRIOR WRITTEN
CONSENT OF THE CUSTOMER TO WHOM SUCH INSURANCE
INFORMATION PERTAINS.
(e) THE INSURANCE COMMISSIONER, IN
CONSULTATION WITH THE COMMISSIONER OF BANKING, MAY
ADOPT REGULATIONS, IN ACCORDANCE WITH CHAPTER 54,
TO CARRY OUT THE PROVISIONS OF THIS SECTION.
NOTHING IN THIS SECTION SHALL BE CONSTRUED TO
LIMIT THE REGULATORY JURISDICTION OF THE INSURANCE
COMMISSIONER OVER THE SALE OF INSURANCE IN THIS
STATE.
Sec. 4. This act shall take effect from its
passage.
Approved July 8, 1997