CHAPTER 19.8. VIATICAL SETTLEMENTS
IC 27-8-19.8
Chapter 19.8. Viatical Settlements
IC 27-8-19.8-1
"Applicant" defined
Sec. 1. As used in this chapter, "applicant" refers to a person thatapplies for a viatical settlement provider license under this chapter.
As added by P.L.130-1994, SEC.47 and P.L.116-1994, SEC.70.Amended by P.L.32-1998, SEC.1; P.L.223-2005, SEC.3.
IC 27-8-19.8-2
"Department" defined
Sec. 2. As used in this chapter, "department" refers to thedepartment of insurance.
As added by P.L.130-1994, SEC.47 and P.L.116-1994, SEC.70.
IC 27-8-19.8-3
"Insured" defined
Sec. 3. As used in this chapter, "insured" refers to an individualwhose life is the subject of insurance under a life insurance policy orcontract.
As added by P.L.130-1994, SEC.47 and P.L.116-1994, SEC.70.Amended by P.L.32-1998, SEC.2; P.L.223-2005, SEC.4.
IC 27-8-19.8-4
Repealed
(Repealed by P.L.32-1998, SEC.32.)
IC 27-8-19.8-4.3
"Viatical settlement agent" defined
Sec. 4.3. As used in this chapter, "viatical settlement agent" meansa person that solicits, offers, or attempts to negotiate a viaticalsettlement contract with a viator.
As added by P.L.32-1998, SEC.3.
IC 27-8-19.8-4.5
"Viatical settlement broker" defined
Sec. 4.5. As used in this chapter, "viatical settlement broker"means a person that represents a viator and for a fee, commission, orother valuable consideration, solicits, offers, or attempts to negotiateviatical settlements between a viator and one (1) or more viaticalsettlement providers.
As added by P.L.32-1998, SEC.4.
IC 27-8-19.8-5
"Viatical settlement provider" defined
Sec. 5. (a) As used in this chapter, "viatical settlement provider"means a person, other than a viator, that:
(1) enters into a viatical settlement contract with a viator; or
(2) obtains financing for the purchase, acquisition, transfer, or
other assignment of one (1) or more viatical settlementcontracts, viaticated policies, or interests therein, or otherwisesells, assigns, transfers, pledges, hypothecates, or disposes ofone (1) or more viatical settlement contracts, viaticated policies,or interests therein.
(b) The term does not include any of the following:
(1) A bank, savings bank, savings association, credit union, orother licensed lending institution that takes an assignment of alife insurance policy as collateral for a loan.
(2) The issuer of a life insurance policy that makes a policyloan, permits surrender of the policy, or pays other policybenefits, including accelerated benefits, in accordance with theterms of the policy.
As added by P.L.130-1994, SEC.47 and P.L.116-1994, SEC.70.Amended by P.L.32-1998, SEC.5; P.L.79-1998, SEC.32.
IC 27-8-19.8-6
"Viatical settlement contract" defined
Sec. 6. As used in this chapter, "viatical settlement contract"means an agreement for the purchase, sale, assignment, transfer,devise, or bequest of a portion of the death benefit or ownership ofa life insurance policy or contract for consideration that is less thanthe expected death benefit of the life insurance policy or contract.The term does not include the following:
(1) A loan by an insurer under the terms of a life insurancepolicy, including a loan secured by the cash value of a policy.
(2) An agreement with a bank, savings bank, savings and loanassociation, credit union, or other licensed lending institutionthat takes an assignment of a life insurance policy as collateralfor a loan.
(3) The provision of accelerated death benefits by an insurer toan insured under the provisions of a life insurance contract.
(4) Agreements between an insurer and a reinsurer.
(5) An agreement by a person who enters into not more thanone (1) such agreement in any five (5) year period to purchasea life insurance policy or contract for the transfer of a lifeinsurance policy for a value that is less than the expected deathbenefit.
As added by P.L.130-1994, SEC.47 and P.L.116-1994, SEC.70.Amended by P.L.32-1998, SEC.6; P.L.128-2000, SEC.2.
IC 27-8-19.8-6.5
"Viaticated policy" defined
Sec. 6.5. As used in this chapter, "viaticated policy" means a lifeinsurance policy or certificate that has been acquired by a viaticalsettlement provider under a viatical settlement contract.
As added by P.L.32-1998, SEC.7.
IC 27-8-19.8-7
"Person" defined Sec. 7. As used in this chapter, "person" means an individual, anassociation, a corporation, a limited liability corporation, an estate,a partnership, a trust, or any other business or legal entity.
As added by P.L.130-1994, SEC.47 and P.L.116-1994, SEC.70.Amended by P.L.32-1998, SEC.8.
IC 27-8-19.8-7.8
"Stranger originated life insurance" defined
Sec. 7.8. (a) As used in this chapter, "stranger originated lifeinsurance" means a practice or plan to initiate a life insurance policyfor the benefit of a third party investor who, at the time the lifeinsurance policy is originated, has no insurable interest in theinsured.
(b) The term includes the following:
(1) An arrangement under which, at the time of life insurancepolicy inception:
(A) a life insurance policy is purchased with resources orguarantees from or through a person that is not legallypermitted to initiate the life insurance policy; and
(B) a written or verbal arrangement or agreement is made totransfer the ownership of the life insurance policy or policybenefits to a third party.
(2) A trust that is:
(A) created to give an appearance of the existence of aninsurable interest; and
(B) used to initiate a life insurance policy for an investor.
As added by P.L.112-2008, SEC.3.
IC 27-8-19.8-8
"Viator" defined
Sec. 8. As used in this chapter, "viator" refers to the owner of alife insurance policy or a certificate holder under a group policy thatinsures the life of an insured who enters or seeks to enter into aviatical settlement contract.
As added by P.L.130-1994, SEC.47 and P.L.116-1994, SEC.70.Amended by P.L.32-1998, SEC.9.
IC 27-8-19.8-8.5
Persons required to be licensed as insurance producer with lifequalification
Sec. 8.5. The following must be licensed as an insurance producerwith a life qualification under IC 27-1-15.6-7:
(1) A viatical settlement broker.
(2) A person who solicits, offers, or attempts to negotiate aviatical settlement contract with a viator.
As added by P.L.32-1998, SEC.10. Amended by P.L.132-2001,SEC.14; P.L.178-2003, SEC.71.
IC 27-8-19.8-8.6
Exemptions from licensing requirement Sec. 8.6. The following are exempt from the licensing requirementunder IC 27-8-19.8-8.5:
(1) An accountant, an attorney, or a financial planner retainedto represent the viator, and whose compensation is paid directlyby or at the direction of the viator.
(2) A regularly salaried officer or employee of a viaticalsettlement broker or viatical settlement provider, if the officeror employee's duties and responsibilities do not include thesolicitation or negotiation of viatical settlement contracts.
(3) The following persons, to the extent that the person isengaged in the administration or operation of a program ofemployee benefits for the person's employees or the employeesof the person's subsidiaries or affiliates involving the use ofviatical settlement contracts issued by a licensed viaticalsettlement provider, if the person is not in any manner directlyor indirectly compensated by the viatical settlement provider:
(A) An employer.
(B) An officer or employee of an employer.
(C) A trustee of an employee trust plan.
As added by P.L.32-1998, SEC.11.
IC 27-8-19.8-8.7
Fiduciary duties of viatical settlement brokers
Sec. 8.7. A viatical settlement broker:
(1) represents only the viator; and
(2) owes a fiduciary duty to the viator to act according to theviator's instructions and in the best interest of the viator;
regardless of the manner in which the viatical settlement broker iscompensated.
As added by P.L.32-1998, SEC.12.
IC 27-8-19.8-9
License required for viatical settlement providers
Sec. 9. After December 31, 1998, a person may not act as aviatical settlement provider unless the person holds an unexpiredlicense issued under this chapter.
As added by P.L.130-1994, SEC.47 and P.L.116-1994, SEC.70.Amended by P.L.32-1998, SEC.13.
IC 27-8-19.8-9.2
Insurance producer remuneration
Sec. 9.2. An insurance producer that:
(1) is licensed under IC 27-1-15.6; and
(2) sells a life insurance policy or contract that, less than two(2) years after the insurance producer sells the policy orcontract, is the subject of a viatical settlement contract;
shall not accept a commission or other remuneration in connectionwith the viatical settlement contract.
As added by P.L.223-2005, SEC.5.
IC 27-8-19.8-10
Application and fee for license
Sec. 10. (a) An applicant must do the following to obtain a licenseas a viatical settlement provider:
(1) Apply for the license on forms prescribed by thedepartment.
(2) Provide information required by the department.
(3) Pay the license fee.
(b) The application must include the name of each officer,member, or employee of the applicant who will be authorized by theapplicant to act as a viatical settlement provider under the license ifissued to the applicant.
(c) The department shall adopt rules under IC 4-22-2 to set thelicensing fee required by this section.
As added by P.L.130-1994, SEC.47 and P.L.116-1994, SEC.70.Amended by P.L.32-1998, SEC.14.
IC 27-8-19.8-11
Investigation of applicant; issuance of license
Sec. 11. The department shall investigate an applicant and issuea license to the applicant if the department finds all of the following:
(1) The applicant is competent and trustworthy and intends toact in good faith as a viatical settlement provider.
(2) The applicant has a good business reputation.
(3) The applicant has had the experience, training, or educationto qualify the applicant as a viatical settlement provider.
(4) If the applicant is a corporation, or limited liabilitycorporation, it is either:
(A) incorporated under Indiana law; or
(B) authorized to do business in Indiana.
As added by P.L.130-1994, SEC.47 and P.L.116-1994, SEC.70.Amended by P.L.32-1998, SEC.15.
IC 27-8-19.8-12
Refusal to issue license
Sec. 12. The department may refuse to issue a license to anapplicant if the department is not satisfied that any officer, employee,partner, or stockholder who could materially influence the applicant'sconduct meets the standards of this chapter.
As added by P.L.130-1994, SEC.47 and P.L.116-1994, SEC.70.
IC 27-8-19.8-13
Nonresident licenses
Sec. 13. The department may not issue a license to an applicantwho is not an Indiana resident unless the applicant does either of thefollowing:
(1) Files and maintains with the department a writtendesignation of an agent for service of process.
(2) Files with the department the applicant's written irrevocableconsent that any action against the applicant may be begun
against the applicant by the service of process on thedepartment.
As added by P.L.130-1994, SEC.47 and P.L.116-1994, SEC.70.
IC 27-8-19.8-14
Individuals authorized to act as viatical settlement benefitsproviders
Sec. 14. A license issued under this chapter authorizes all officers,members, and employees of the license holder designated undersection 10(b) of this chapter to act as viatical settlement providersunder the license.
As added by P.L.130-1994, SEC.47 and P.L.116-1994, SEC.70.Amended by P.L.32-1998, SEC.16.
IC 27-8-19.8-15
Expiration and renewal of license
Sec. 15. (a) A license issued or renewed under this chapter expireson July 1 after its issuance or renewal.
(b) A viatical settlement provider may renew a license by:
(1) applying for renewal on forms prescribed by the department;and
(2) paying the renewal fee.
(c) The department shall adopt rules under IC 4-22-2 to do thefollowing:
(1) Set the renewal fee required by this section.
(2) Set a date before July 1 and before which receipt of alicense renewal application can be processed without a lapse inthe license.
(d) A viatical settlement provider that submits an application forrenewal after the date set under subsection (c)(2):
(1) is not entitled to have the license renewed before July 1; and
(2) may not act as a viatical settlement provider until thedepartment issues the license renewal, if the department isunable to process the renewal before July 1.
As added by P.L.130-1994, SEC.47 and P.L.116-1994, SEC.70.Amended by P.L.32-1998, SEC.17.
IC 27-8-19.8-16
Disclosure of identity of individuals associated with viaticalsettlement providers
Sec. 16. The department may at any time require a viaticalsettlement provider or an applicant for a license to disclose fully theidentity of all of the viatical settlement provider's or applicant'sofficers, employees, partners, and stockholders.
As added by P.L.130-1994, SEC.47 and P.L.116-1994, SEC.70.Amended by P.L.32-1998, SEC.18.
IC 27-8-19.8-17
Annual reports
Sec. 17. (a) A viatical settlement provider shall file with the
department an annual report containing information prescribed inrules adopted by the department under IC 4-22-2.
(b) The rules adopted by the department under subsection (a) shallset the date by which annual reports must be submitted.
(c) A viatical settlement provider shall maintain records of eachviatical settlement at least five (5) years after the death of theinsured.
As added by P.L.130-1994, SEC.47 and P.L.116-1994, SEC.70.Amended by P.L.32-1998, SEC.19.
IC 27-8-19.8-18
Examination of viatical settlement provider or applicant
Sec. 18. (a) When the department reasonably considers itnecessary for the protection of the public, the department mayexamine the business and other affairs of a viatical settlementprovider or an applicant.
(b) The department may order a viatical settlement provider or anapplicant to produce records, books, files, or other informationreasonably necessary to ascertain whether the viatical settlementprovider or the applicant has violated or is violating the law orotherwise has acted or is acting contrary to the public interest.
(c) The viatical settlement provider or applicant shall pay theexpenses of an examination conducted under this section.
As added by P.L.130-1994, SEC.47 and P.L.116-1994, SEC.70.Amended by P.L.32-1998, SEC.20.
IC 27-8-19.8-19
Suspension, revocation, or refusal to renew license
Sec. 19. After a hearing under IC 4-21.5, the department maysuspend, revoke, or refuse to renew a viatical settlement provider'slicense, or impose a civil penalty, or both, if the department finds anyof the following:
(1) There was a misrepresentation in the application for thelicense.
(2) The viatical settlement provider is untrustworthy orincompetent to act as a viatical settlement provider.
(3) The viatical settlement provider demonstrates a pattern ofunreasonable payments to viators.
(4) The viatical settlement provider has been convicted of, orpleaded guilty or nolo contendere to, an offense the definitionof which includes fraudulent acts as an element of the offenseregardless of whether a judgement has been entered by thecourt.
(5) The viatical settlement provider no longer meets therequirements for initial licensure.
(6) The viatical settlement provider has failed to honor thecontractual obligations of a viatical settlement contract.
(7) The viatical settlement provider has violated this chapter.
As added by P.L.130-1994, SEC.47 and P.L.116-1994, SEC.70.Amended by P.L.32-1998, SEC.21.
IC 27-8-19.8-20
Repealed
(Repealed by P.L.32-1998, SEC.32.)
IC 27-8-19.8-20.1
Stranger originated life insurance; prohibition
Sec. 20.1. (a) A person shall not issue, solicit, market, orotherwise promote the purchase of a life insurance policy inconnection with stranger originated life insurance.
(b) A violation of this section is an unfair and deceptive act orpractice in the business of insurance under IC 27-4-1-4.
As added by P.L.112-2008, SEC.4.
IC 27-8-19.8-21
Required terms of viatical settlement contract
Sec. 21. (a) A viatical settlement contract must establish the termsunder which the viatical settlement provider will pay value, in returnfor the viator's assignment, bequest, devise, sale, or transfer of thedeath benefit, certificate, or ownership of the insurance policy to theviatical settlement provider.
(b) A viatical settlement contract must provide for theunconditional rescission of the contract by the viator for the longerof the following:
(1) the period ending not more than fifteen (15) days after thereceipt of the viatical settlement proceeds by the viator; or
(2) the period ending not more than thirty (30) days afterexecution of the contract.
(c) A viatical settlement contract is rescinded if the insured diesduring the rescission period, subject to repayment to the viaticalsettlement provider of all proceeds and any premiums, loans, andloan interest that have been paid by the viatical settlement provider.
As added by P.L.130-1994, SEC.47 and P.L.116-1994, SEC.70.Amended by P.L.32-1998, SEC.22; P.L.223-2005, SEC.6.
IC 27-8-19.8-22
Form for viatical settlement contract
Sec. 22. (a) A person may not use a viatical settlement contractform or a disclosure form in Indiana unless the contract form ordisclosure form has been filed with and approved by the department.
(b) A viatical settlement contract form or disclosure form filedwith the department is considered approved if the department has notdisapproved the form within sixty (60) days after the filing.
(c) The department shall disapprove a viatical settlement contractform or disclosure form if the department finds that the contractform, disclosure form, or the provisions of the contract are:
(1) misleading or unfair to the viator;
(2) not in compliance with this chapter; or
(3) otherwise contrary to the public interest.
As added by P.L.130-1994, SEC.47 and P.L.116-1994, SEC.70.Amended by P.L.32-1998, SEC.23.
IC 27-8-19.8-23
Required disclosures to viator; information to insured
Sec. 23. (a) A viatical settlement provider or viatical settlementbroker shall, not later than the date of application, provide to a viatora brochure approved by the commissioner and describing the viaticalsettlement process. If a brochure describes only a viatical settlementcontract in which the insured does not have a catastrophic or lifethreatening illness or condition, the brochure may use the term "lifesettlement" in place of the term "viatical settlement".
(b) A viatical settlement provider or viatical settlement brokershall, in a separate document that is signed by the viator and theviatical settlement provider or viatical settlement broker, disclose thefollowing information to the viator not later than the date ofapplication:
(1) Possible alternatives to viatical settlement contracts,including accelerated benefits or policy loans offered by theissuer of the life insurance policy.
(2) Federal and state tax consequences that may result fromentering into a viatical settlement contract, and that the viatorshould seek assistance from a professional tax advisor.
(3) Possible:
(A) adverse effect on eligibility for; or
(B) interruption of assistance provided by;
medical or public assistance programs as a consequence ofentering into a viatical settlement contract, and that the viatorshould seek advice from the appropriate government agencies.
(4) The viator's right to rescind a viatical settlement contract asprovided in section 21 of this chapter.
(5) The amount of any fees paid by a viatical settlementprovider to a viatical settlement broker.
(6) A statement that proceeds of the viatical settlement could besubject to claims of creditors.
(7) A statement that:
(A) entering into a viatical settlement contract may causeother rights or benefits under the policy, includingconversion rights, waiver of premium benefits, family riders,or coverage of a life other than the insured, to be forfeited bythe viator; and
(B) the viator should seek advice from a financial advisor.
(8) The procedure for contacts with the insured.
(9) That the proceeds of the viatical settlement will betransferred to the viator as provided in section 24.2 of thischapter.
(10) A statement containing the following language:
"All medical, financial, or personal information solicited orobtained by a viatical settlement provider or viaticalsettlement broker about an insured, including the insured'sidentity or the identity of family members, a spouse, or asignificant other may be disclosed as necessary to effect theviatical settlement between the viator and the viatical
settlement provider. If you are asked to provide thisinformation, you will be asked to consent to the disclosure.The information may be provided to someone who buys thepolicy or provides funds for the purchase. You may be askedto renew your permission to share information every twoyears.".
(11) That the insured may be contacted by the viaticalsettlement provider or viatical settlement broker to determinethe health status of the insured in accordance with section 24.9of this chapter.
(c) The viatical settlement provider shall disclose the followinginformation to the viator, conspicuously displayed in the viaticalsettlement contract or in a separate document signed by the viaticalsettlement provider and the viator, before a viatical settlementcontract is signed:
(1) Any affiliation between the viatical settlement provider andthe insurer that issued the life insurance policy or certificatethat is the subject of the viatical settlement contract.
(2) The name, address, and telephone number of the viaticalsettlement provider.
(3) If the life insurance policy or certificate that is the subjectof the viatical settlement contract was issued as a joint policy orincludes family riders or any coverage of an individual otherthan the insured:
(A) the possible loss of coverage of the other individualsunder the policy or certificate; and
(B) that the viator should consult with the viator's insuranceproducer or the insurer that issued the policy or certificatefor advice concerning the proposed viatical settlementcontract.
(4) The:
(A) dollar amount of the current death benefit payable to theviatical settlement provider; and
(B) if known, the:
(i) availability of any additional guaranteed insurancebenefits;
(ii) dollar amount of any accidental death anddismemberment benefits; and
(iii) viatical settlement provider's interest in the benefitsdescribed in items (i) and (ii);
under the policy or certificate.
(5) The:
(A) name, business address, and telephone number of thetrustee or escrow agent described in section 24.2 of thischapter; and
(B) right of the viator or insured to inspect or receive copiesof the relevant escrow or trust agreements or documents.
(d) A viatical settlement broker shall disclose to the viator,conspicuously displayed in the viatical settlement contract or in aseparate document signed by the viatical settlement broker and the
viator before a viatical settlement contract is signed, the amount andmethod of calculation of the viatical settlement broker'scompensation.
(e) If a viatical settlement provider transfers ownership or changesthe beneficiary of a viaticated policy, the viatical settlement providershall, not more than twenty (20) days after the transfer or changeoccurs, inform the insured of the transfer or change.
As added by P.L.130-1994, SEC.47 and P.L.116-1994, SEC.70.Amended by P.L.32-1998, SEC.24; P.L.223-2005, SEC.7.
IC 27-8-19.8-24
Prerequisites to viatical settlement contract
Sec. 24. A viatical settlement provider shall obtain the followingbefore entering into a viatical settlement contract:
(1) If the viator is the insured, a written statement from alicensed attending physician that the insured is of sound mindand under no constraint or undue influence.
(2) A document signed by the viator and witnessed by two (2)disinterested witnesses in which the viator does the following:
(A) Consents to the viatical settlement contract.
(B) If the insured has a catastrophic or life threateningillness or condition, acknowledges the catastrophic or lifethreatening illness or condition.
(C) Represents that the viator has a full and completeunderstanding of the viatical settlement contract.
(D) Represents that the viator has a full and completeunderstanding of the benefits of the life insurance policy.
(E) Acknowledges that the viator has entered into theviatical settlement contract freely and voluntarily.
(F) Discloses the identity of any person that served as aviatical settlement broker in connection with the viaticalsettlement contract.
(3) A document in which the insured consents to the release ofthe insured's medical records.
As added by P.L.130-1994, SEC.47 and P.L.116-1994, SEC.70.Amended by P.L.32-1998, SEC.25; P.L.223-2005, SEC.8.
IC 27-8-19.8-24.2
Payment of proceeds of settlement to trust or escrow account;transfer of proceeds of settlement to viator
Sec. 24.2. (a) Immediately upon a viatical settlement provider'sreceipt of a signed viatical settlement contract, the viatical settlementprovider shall pay the proceeds of the viatical settlement to a trust orescrow account in a state or federally chartered financial institutionwhose deposits are insured by the Federal Deposit InsuranceCorporation. The account shall be managed by a trustee or escrowagent independent of the parties to the contract.
(b) Within two (2) business days after the viatical settlementprovider's receipt of the insurer's or group administrator'sacknowledgment that ownership of the policy or interest in the
certificate has been transferred and the beneficiary has beendesignated according to the viatical settlement contract, the trusteeor escrow agent shall transfer the proceeds to the viator.
As added by P.L.32-1998, SEC.26.
IC 27-8-19.8-24.7
Disclosure of identity of viator
Sec. 24.7. Except as otherwise provided by law, a person withactual knowledge of a viator's identity may not disclose that identityto another person unless the disclosure is:
(1) necessary to effect a viatical settlement contract and theviator has provided written consent to the disclosure;
(2) provided in response to an investigation by thecommissioner or other governmental officer or agency; or
(3) in connection with a transfer of a viatical settlement contractor viaticated policy to another licensed viatical settlementprovider or to an entity that provides financing to effect theviatical settlement contract under a written agreement with alicensed viatical settlement provider.
As added by P.L.32-1998, SEC.27.
IC 27-8-19.8-24.8
Applicability of IC 16-39 to release of insured's medical records
Sec. 24.8. IC 16-39 applies to the release of an insured's medicalrecords under this chapter.
As added by P.L.32-1998, SEC.29.
IC 27-8-19.8-24.9
Contacts with insured for purpose of determining health status
Sec. 24.9. (a) The viatical settlement provider or viaticalsettlement broker may contact the insured for the purpose ofdetermining the health status of the insured not more than:
(1) one (1) time every three (3) months for an insured with a lifeexpectancy of more than one (1) year; or
(2) one (1) time every month for an insured with a lifeexpectancy of not more than one (1) year.
(b) Contacts made with an insured under subsection (a) must bemade by mail unless the parties agree to another method of contact.
As added by P.L.32-1998, SEC.28.
IC 27-8-19.8-25
Standards for evaluation of reasonableness of payments underviatical settlement contract
Sec. 25. The department may adopt rules under IC 4-22-2 toestablish standards for evaluating the reasonableness of paymentsunder viatical settlement contracts, including regulation of discountrates used to determine the amount paid in exchange for anassignment, a bequest, a devise, a sale, or a transfer of a benefitunder a life insurance policy.
As added by P.L.130-1994, SEC.47 and P.L.116-1994, SEC.70.
Amended by P.L.32-1998, SEC.30.
IC 27-8-19.8-26
Adoption of rules
Sec. 26. The department may adopt rules under IC 4-22-2 that thedepartment considers necessary to implement this chapter.
As added by P.L.130-1994, SEC.47 and P.L.116-1994, SEC.70.