September 2011
Producer Advisory
To:
Individual Annuities Department
Producers Appointed to Sell Standard Insurance Company's Annuity Products in Delaware
From:
Bill Douglas, FLMI, FFSI, AIRC, AAPA, ACS, CCP
Compliance Manager, Individual Annuities
State:
Delaware
Bill:
Senate Bill 30
Effective:
January 1, 2012
Subject:
Civil Union Arrangements
PURPOSE: To recognize civil unions on the same basis as marriages between opposite-sex spouses.
SUMMARY: The State of Delaware enacted Senate Bill 30 relative to recognizing civil unions on the same basis as marriage.
In summary:
- Civil unions (a legal union between two individuals of the same sex) for which a civil union license has been provided under Delaware law will now be recognized in the State of Delaware.
- Civil union partners will have the same rights, protections and benefits, and will be subject to the same responsibilities, obligations and duties as married spouses under Delaware law and rules.
- Delaware does not have the jurisdiction to control the many federal laws that are intertwined with its laws or any of the associated rights, benefits and responsibilities.
- The Defense of Marriage Act (DOMA) provides that for purposes of federal law, the term "marriage" means only opposite sex marriages and "spouse" means only an opposite sex husband or wife.
- To ensure that an annuity is not disqualified under federal law, the rights, privileges and protections specifically afforded to parties of a marriage under federal law and not mandated under state law, are not to be afforded to civil union partners. Examples:
- Providing a civil union party the right to consent to his or her partner's distribution
- Providing a civil union party the right to consent to his or her partner's designation to a non-spouse beneficiary
- Providing a civil union party the right to consent to his or her partner's taking out a policy/plan loan
- Paying benefits to a civil union party under a domestic relations order
- Allowing a rollover of a deceased owner's account balance of a qualified plan (e.g., 403(b) or 401(k) or IRA), to an IRA with the surviving civil union party as owner of the IRA
- Naming a civil union party as beneficiary of a nonqualified plan and allowing him or her to continue as the contract owner upon the death of the owner
- Delaware not a community property state. In the absence of a court order, there is no requirement to recognize the 50 percent community asset issue in Delaware.
- Since spousal consent is not required for any non-spouse beneficiary designation, civil union party consent is not required for a non-civil union party beneficiary designation.
We very much appreciate your business and for ensuring that the products and operations of The Standard continue to comply with applicable laws, regulations and rules.
Our goal is to support and enable your sales goals in such a manner as to mitigate and eliminate any risk of compliance exposure.
Please feel free to contact me at 800.378.4578, ext 7427 if you have any questions or need additional information regarding this Producer Advisory.