In addition to the contents specified in §25.2 of this title (relating to All Prepaid Funeral Contracts), each prepaid funeral contract submitted for approval by the Department that is funded by a policy of insurance as provided in Finance Code, §154.201, must contain the following:

1. (1) Policy and Premiums--a statement that the contract is funded with a policy of insurance; that the seller or the insurance company, as the case may be, will, on or before the 30th day after receiving any payment under the contract, use the amount received to pay the policy premiums in accordance with the terms of the policy, unless the beneficiary is denied insurance coverage; that, if the beneficiary is denied insurance coverage, the insurance company shall notify the purchaser in writing of the reason for denial within 30 days of the date the purchaser executes the contract and refund all monies paid on the contract; and, if the insurance policy is owned by the purchaser of the prepaid funeral contract, that the seller will furnish the purchaser a copy of the policy on or before the 30th day after its issuance;
2. (2) No Partial Cancellations of Policy or Withdrawals of Proceeds--an acknowledgment that neither the purchaser nor the seller may make partial cancellations of, take a loan against, or, except for escheatment of funds, withdraw proceeds that have accrued under the policy.

Source Note:The provisions of this §25.3 adopted to be effective January 4, 1995, 19 TexReg 10229.