Cemetery Merchandise Trust (CMT) Permit

Statutes: 36 O.S. § 7121 – 7135 and OAC 365:25-23-1 to 365:25-23-9

Disclaimer: The following is an overview of the laws pertaining to CMT permits.  Refer to the OSCN webpage to research all the statutes pertaining to CMT permits.

Cemetery Merchandise Trust (CMT) Permit, 36 O.S. § 7124 (A).

Any organization which shall accept money or anything of value for cemetery merchandise pursuant to a prepaid cemetery merchandise contract shall first obtain a permit from the Insurance Commissioner authorizing the transaction of this type of business before entering into the contract. It shall be unlawful to sell any prepaid cemetery merchandise unless the organization holds a valid, current permit at the time the contract is made. The organization shall not be entitled to enforce a contract made in violation of the Cemetery Merchandise Trust Act, but the purchaser, or the heirs or legal representative of the purchaser, shall be entitled to recover triple the amounts paid to the organization with interest thereon at the rate of six percent (6%) per annum under any contract made in violation of this act.

Administration of Act 36 O.S. § 7124

The Cemetery Merchandise Trust Act, Sections 7121 through 7135 of this title, shall be administered by the Insurance Commissioner. The Commissioner is authorized to promulgate reasonable rules concerning the keeping and inspection of records, the filing of contracts and reports, investments of and handling of the trust funds, and all other matters concerning the orderly administration and implementation of the Cemetery Merchandise Trust Act. All prepaid cemetery merchandise contracts shall be in writing, and no contract form created after July 1, 2010, shall be used without first being submitted to, and approved by, the Commissioner.

Definitions 36 O.S. § 7122 – 7125

Cemetery merchandise” means markers, memorials, vases, memorial vases, monuments, equipment, crypts, niches, or outer enclosures. Cemetery merchandise shall not include the sale of lands or interests therein as grave lots or grave spaces; burial or interment rights; and delivered or installed crypts, niches, or outer enclosures.

Purchase price” means the gross amount to be paid for cemetery merchandise under the provisions of a prepaid cemetery merchandise contract. Purchase price shall not include finance charges, sales tax, charges for real property interests or charges for credit life insurance.

Prepaid cemetery merchandise contract” means any agreement for the sale of cemetery merchandise by an organization which requires payment of the purchase price, in whole or in part, prior to delivery of the cemetery merchandise, which agreement is entered into from and after November 1, 1989.

Minimum funding requirement” means that portion of the purchase price equal to one hundred ten percent (110%) of the wholesale cost, plus delivery charges, of the cemetery merchandise covered in a prepaid cemetery merchandise contract.

Organization” means any individual, firm, partnership, trust, corporation, association or entity. Organization shall not include state, county, municipal, township, rural community, religious, fraternal or nonprofit entities, free community burial grounds, county cemetery associations, Indian tribal cemeteries on tribal land and charitable or eleemosynary institutions operating cemeteries in this state.

Outer enclosure” means a grave liner, grave box, or grave vault.

Lawn crypt” means a subsurface permanent outer enclosure installed before need in multiple units for the purpose of interring human remains.

Financial institution” means a federally insured bank, trust company, or savings and loan association which is authorized to do business in this state.

Commissioner” or “Insurance Commissioner” means the Insurance Commissioner of the State of Oklahoma.

Wholesale cost” means an amount determined on the basis of such standard quotations and price lists as are published by the vendor of the cemetery merchandise, without regard to any discounts that may be available to the organization.


Permit Application, 36 O.S. § 7125 – 7127 and 365:25-23-4 to 365:25-23-6

Cycle – Permits will expire on March 15th of the year following the year the permit is first issued, unless renewed prior to the expiration date.  The filing period is YTD January – December.

Fees:

Due Dates and Fees

Requirements for Initial / Renewal Application –

Applications are available via OPTins and must be submitted electronically.  The following items will be requested on the application.

  1. Permit Demographics,
  2. Disclose administrative or criminal actions,
  3. Consumer Complaints Contact Information, and
  4. Owner or Officer List (NAIC UCAA Form 11 Biographical Affidavit required to be on file for each individual), and
  5. The Annual Report must be received and deemed compliant.
Discontinuation of Sales, 36 O.S. § 7128.

Any organization which has discontinued the sale of prepaid cemetery merchandise, but which still has funds deposited in a cemetery merchandise trust fund or surety, shall not be required to obtain a renewal of its permit, but it shall continue to make annual reports to the Commissioner until all the funds have been disbursed pursuant to the Cemetery Merchandise Trust Act.

Annual report, 36 O.S. § 7125, 7128, and 365:25-23-3 thru 365:25-23-8

Cycle – Annual Reports are due prior to March 15th, annually, following year permit was issued.  The filing period is YTD January – December and all data entered should be as of December 31, prior year-end.

36 O.S. § 7128.

Each organization shall file an annual report with the Insurance Commissioner on or before March 15 of each year in a form as the Commissioner may require. A filing fee of Two Hundred Dollars ($200.00) shall accompany each report. If any officer of any organization fails or refuses to file an annual report or fails or refuses to cause it to be filed within thirty (30) days after the organization has been notified by the Commissioner that the report is due and has not been received, the officer shall be guilty of a misdemeanor and shall be punished as prescribed in Section 7134 of this title.

CMT Funding Options – Trust Account, 36 O.S. § 7126.

Each organization shall establish and maintain a cemetery merchandise trust fund with a financial institution having trust powers. A cemetery merchandise trust fund shall at all times be in the custody of a financial institution. Any cemetery merchandise trust funds may be invested, reinvested, exchanged, retained, sold and managed as a part of common trust funds in the manner provided in the Oklahoma Trust Act, Sections 175.1 through 175.57 of Title 60 of the Oklahoma Statutes, and any amendments thereto. A copy of each contract or a written notice containing all relevant information regarding the prepaid cemetery merchandise contracts for which deposits are made shall be furnished to the financial institution. The financial institution shall serve as trustee for the purposes of the Cemetery Merchandise Trust Act.

Trust fund and trustee, OAC 365:25-23-5.

A holder of a Cemetery Merchandise Permit with funds in trust shall keep the Insurance Department informed of the identity of the trustee at all times and at all times shall comply with the provisions of 36 O.S. § 7126. Prior to changing the trustee, trust agreement or trust location, a permit holder shall notify the Commissioner at least thirty (30) days prior to any transfer or change stating the reason for the proposed change.

  • Trust Fund Annual Report information:
    • Financial Institution acting as trustee,
    • A copy of Trust Agreement between financial institution and permit holder must be on file with the OID,
    • Provide a copy of the December 31st, Trust statement prepared by the financial institution.
CMT Funding Option – Surety Bond, 36 O.S. § 7127.

As an alternative to the trust requirements of Section 7126, an organization may purchase a surety bond in an amount not less than the minimum funding requirement.

  • Attach the Surety Bond form (located on our webpage) in an amount above the minimum funding requirement.
Wholesale cost and Minimum Funding, 36 O.S. § 141.18 (E).

Annually, as of December 31 of each year, each organization shall determine the wholesale cost for all cemetery merchandise covered by a prepaid cemetery merchandise contract for which funds are then held in a cemetery merchandise trust or in an individual merchandise account.

  • Total wholesale amount,
  • Total purchase price, and
  • Minimum funding requirement of 110% of the Wholesale amount.
Annual Report – Client Records, OAC 365:25-23-8.

Annual reportOn or before March 15 of each year, each permit holder shall file an Annual Report with the Oklahoma Insurance Department which shall include the following information:

    1. Name of the cemetery
    2. Town where the cemetery is located
    3. Name and address of person to contact with questions about the report
    4. Period of time covered by the report
    5. Trust account numbers
    6. Merchandise covered by each account
    7. Amount deposited on each account to the trust fund
    8. Beginning and ending balance
    9.  Method of determination of wholesale cost
      • Wholesale cost” means an amount determined on the basis of such standard quotations and price lists as are published by the vendor of the cemetery merchandise, without regard to any discounts that may be available to the organization.
    10. A current original manufacturer’s price list from any and all cemetery merchandise suppliers used by the permit holder; and
    11. Name of the vault company with whom the permit holder deals.

Services, 36 O.S. § 7124(D). 

Unless sold pursuant to a Funeral Home Prepaid Benefit permit issued under Section 6121 of title 36, no organization in Oklahoma may sell, in advance of actual need, the services of opening or closing a burial space, as defined in Section 7102 of this title, unless the organization deposits in trust no less than sixty-five percent (65%) of the principal amount of the services sold, or maintains a surety bond for the full principal amount of the services sold. Any contracts for services sold before July 1, 2010, remain enforceable by the purchaser against the seller.

36 O.S. § 7102.  Definitions as used in the Perpetual Care Fund Act:   “Burial space” means any grave space, lot, mausoleum crypt or niche, whether above or below ground, which is used or intended to be used for the interment of human remains.

CMT Change of Ownership, OAC 365:25-23-4.

Prior to the sale of a cemetery with a CMT permit, both the seller and the buyer are required to submit the following documents in one comprehensive email to RIS@oid.ok.gov .

Duties of the Seller:
  1. Notice of Sale – submit the form a least forty-five (45) days prior to the transfer.
  2. Seller’s Agreement – submit a copy of the Seller’s Agreement (or contract for sale) for review.
  3. List of undelivered prepaid cemetery merchandise contracts – provide a list containing the contract holder’s name; the beneficiary’s name(s), contract number, contract value, and trust value at the time of notice.
Duties of the Buyer:
    1. Buyer is required to have an active CMT permit issued by the OID at the time of notice.
    2. Application for Purchase of Cemetery– submit the completed form.