Filing Guidance for Changes to Section 1110(a) of the Insurance Law
Section 1110(a) of the insurance law was amended on July 20, 2004 to permit a charitable organization to receive gifts of "cash and other property" in return for its agreement to pay an annuity to the donor. Prior to the amendment, gifts were restricted to cash, stocks, bonds or other negotiable securities.
In anticipation of charitable gift annuity filings being submitted to the Department based on this change, we offer the following guidance:
Previously Approved Charitable Gift Annuity Agreements
If a charity, which had charitable gift annuity agreements found acceptable by the Department prior to the amendment to 1110(a), now wishes to accept donations of "other property" in addition to cash, stocks, bonds or other negotiable securities (e.g. Real Property, Personal Property) the previously accepted forms must be amended.
The Submission Letter
- The submission should be directed to:
- Identify in bold in the "Re" of the submission letter "Section 1110(a) Change - Gift Annuity Filing" for ease of identification by the Department.
- Provide in the submission letter the form number of the previously approved form, the approval date and Department file number (Albany Office file number not NYC office file number).
- Identify in the submission letter the change being made and indicate that it is the only change being made to the previously approved form.
Kathleen A. Nelligan
Chief Insurance Policy Examiner
Department of Financial Services
One Commerce Plaza 19th Floor
Albany, NY 12257
- The revised form must have a new form number that is not duplicative of the previously approved forms. One possibility is to add a revision date to the previously approved form number. (e.g. forms 1L-D or 2L-JS-D could become 1L-D(5/05) and 2L-JS-D(5/05), etc.)
- The agreement must contain a description of the donated
property. This must be expressed in the agreement. While it is acceptable
to include a more detailed description in an attached schedule, the
body of the agreement must also contain a description of the gift.
Because the forms are generic, the description should be expressed
as a variable. We would suggest language substantially similar to
"The Donor, as evidence of his/her desire to support the work of the charity and to make a charitable gift, on [date] contributed to the charity [description of donation] in the amount of or having a fair market value of [$________ ]."
While regular prior approval submission methods are available, we would recommend that the charity use the Departments streamline certification procedure under Circular Letter 6 of 2004. Please note that in addition to the above requirements, submissions under the Circular Letter 6 procedure must also comply with the filing requirements for Circular Letter 6 submissions, which can be found on our website.