(1) No person, firm, partnership, association or corporation may directly or indirectly, or through an agent, engage in the sale of preneed contracts or preneed contracts for caskets except as authorized under this article. Any person, establishment or company required to register under Section 73-11-67 that sells preneed contracts for caskets, either directly or indirectly or through an agent, shall be required to meet all of the requirements of this article that are applicable to preneed contracts. All preneed contracts sold shall be evidenced in writing on forms approved by and on file with the Secretary of State. No contract form may be used without prior approval of the Secretary of State. No amendment or modification can be made to any preneed contract without prior approval of the Secretary of State. The use of any oral preneed contract, or any written contract, in a form not approved by the Secretary of State, shall be a violation of the chapter and subject to the penalties provided in Section 75-63-69. The contract shall clearly indicate the names and addresses of the buyer, contract insured, contract provider and seller. The Secretary of State may by rule or regulation prescribe specific contract content or a standard contract form required for use by all contract providers describing the rights and responsibilities of the contract provider and the contract owner. However, no standard form contract or contract language shall be inconsistent in any way with the provisions of this article. The Secretary of State is further authorized to implement a systematic method to identify and track preneed contract sales for the purpose of reconciling sales reported to the Secretary of State on the annual report required by Section 75-63-67 with trust fund activity statements and the provider’s business records.

(2) The contract shall clearly indicate all merchandise covered by the contract, a description of the merchandise quality, and the total cost of all merchandise covered by the contract. The contract shall list all services covered by the contract and the total cost for all services covered by the contract. The contract shall list all cash advance items covered by the contract and the total cost for all cash advance items covered by the contract.

(3) All preneed contracts sold shall be funded by trust or insurance as defined in this article or evidenced by a warehouse receipt, as contemplated in Uniform Commercial Code-Documents of Title, Section 75-7-101 et seq. All merchandise placed on a warehouse receipt or placed in storage shall be reported to the Secretary of State in the preneed report as required by Section 75-63-67.

(4) If the preneed contract is funded by a policy of insurance, as defined by Section 83-5-5, a copy of the insurance policy shall be furnished to the insured within fifteen (15) days of issue. Such insurance shall be subject to the insurance laws of the state.

The insured shall be furnished the following:

(a) A list of the merchandise, including a description of the merchandise quality, and services which are applied or contracted for in the preneed contract and all relevant information concerning the price of the funeral services, including an indication that the purchase price is either guaranteed at the time of purchase or to be determined at the time of need;

(b) All relevant information concerning what occurs and whether any entitlements or obligations arise if there is a difference between the proceeds of the life insurance policy and the amount actually needed to fund the preneed contract; and

(c) Any penalties or restrictions, including, but not limited to, geographic restrictions or the inability of the provider to perform, on the delivery of merchandise, services or the preneed guarantees.

If the preneed contract is not funded by a policy of insurance, as defined by Section 83-5-5, a copy of the preneed contract shall be furnished to the contract insured at the time of purchase.

(5) If the preneed contract is funded by trust, the contract shall indicate the name, address and telephone number of the trustee; the trust institution; the amount to be paid; the frequency of payment; and the length of time payments will be paid into the trust. The contract insured must initial on the contract the percentage required to be trusted and the designation of the trust officer. In addition, the contract should clearly indicate any exclusions or limitations of the preneed contract including, but not limited to, any additional payments that may be owed if the contract insured dies before the agreed upon payment period is completed.

(6) The preneed contract shall indicate whether it is a standard contract or an inflation proof contract. The contract shall clearly indicate which merchandise and services are guaranteed as to price.

(7) The preneed contract shall contain the address and phone number of the Secretary of State with instructions that consumer complaints may be filed with the Secretary of State.

(8) If the preneed contract is paid in multiple payments, the contract should indicate the amount, frequency and duration of the payments and the amount of any interest charged. The contract shall also include the impact on the contract if payments are not made.

(9) The use of any oral preneed contract, or any written contract, in a form not approved by the Secretary of State, shall be a violation of this article and subject to the penalties provided in Section 75-63-69.