House File 192 HOUSE FILE BY KLEMME Passed House, Date Passed Senate, Date Vote: Ayes Nays Vote: Ayes Nays Approved A BILL FOR 1 An Act prohibiting a cancellation penalty upon cancellation of a 2 purchase agreement for cemetery merchandise, funeral 3 merchandise, and funeral services. 4 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 5 TLSB 1605HH 80 6 av/sh/8 PAG LIN 1 1 Section 1. Section 523A.602, subsection 2, paragraph b, 1 2 Code 2003, is amended to read as follows: 1 3 b. If a purchase agreement is canceled, a purchaser 1 4 requests a transfer of the trust assets upon cancellation of a 1 5 purchase agreement, or another establishment provides 1 6 merchandise or services designated in a purchase agreement, 1 7 the seller shall refund or transfer within thirty days of 1 8 receiving a written demand no less than the purchase price of 1 9 the applicable cemetery merchandise, funeral merchandise, and 1 10 funeral services adjusted for inflation, using the consumer 1 11 price index amounts announced by the commissioner annually, 1 12 less anycancellation penaltyactual expenses incurred by the 1 13 seller pursuant to the purchase agreement as set forth in the 1 14 purchase agreement under section 523A.601, subsection 1, 1 15 paragraph "f". The amount of thecancellation penaltyactual 1 16 expenses deducted by the seller shall not exceed ten percent 1 17 of the purchase price of the applicable cemetery merchandise, 1 18 funeral merchandise, and funeral services. The seller may 1 19 also deduct the value of the cemetery merchandise, funeral 1 20 merchandise, and funeral services already received by, 1 21 delivered to, or warehoused for the purchaser. 1 22 EXPLANATION 1 23 This bill prohibits a cancellation penalty upon 1 24 cancellation of a purchase agreement for cemetery merchandise, 1 25 funeral merchandise, funeral services, or a combination 1 26 thereof by providing that when such a purchase agreement is 1 27 canceled, the seller of the purchase agreement must refund or 1 28 transfer, upon a written demand, no less than the purchase 1 29 price of the applicable cemetery merchandise, funeral 1 30 merchandise, and funeral services adjusted for inflation, 1 31 using the consumer price index amounts announced by the 1 32 commissioner annually, less any actual expenses incurred by 1 33 the seller which have been specified in the purchase 1 34 agreement. The bill also provides that the amount of actual 1 35 expenses deducted from the purchase price by the seller cannot 2 1 exceed 10 percent of the purchase price of the applicable 2 2 cemetery merchandise, funeral merchandise, and funeral 2 3 services. 2 4 LSB 1605HH 80 2 5 av/sh/8