Replacement notices requirement?

• A. No notices required
• B. Only the policyholder signature is required
• C. The old policy must be canceled before replacing
• D. Required notices must be furnished to the client

Answer: (D)

Replacement notices must be given to the client whenever a life policy is being replaced. These notices inform the client that a replacement is under consideration, outline important implications of the replacement (such as changes in cash value, surrender charges, premium differences, loss of riders or conversion rights, and how the new policy compares to the old one), and encourage careful comparison and informed decision-making. Meeting this requirement helps protect the client and ensures compliance with Louisiana regulations governing replacement transactions. The old policy does not have to be canceled before the replacement is issued, and simply requiring the policyholder’s signature on a form isn’t enough—the notices themselves must be provided to the client (with acknowledgment) to satisfy the rule.