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26 TITLE 16 HEALTH AND SAFETY DELAWARE ADMINISTRATIVE CODE Current recipients who have been eligible since 7/11/90 who have had burial funds excluded which do not meet all the new requirements must convert or separate such funds to meet these requirements unless there is an impediment to such conversion or separation; i.e., a circumstance beyond the individual's control which makes the conversion/separation impossible or impracticable. For as long as such impediment exists, the burial funds will continue to be excluded if the individual remains otherwise eligible for the exclusion. 20340.2.4 Declarative Designation Statement A declarative designation statement must be signed by the applicant/representative in order for funds to be excluded. In cases where funds are not designated for burial, the funds may be excluded as of the first day of the month in which the applicant/representative signs the Burial Designation Statement. Within 30 days from the date the statement is signed, documentary evidence must be submitted that funds have been set aside. A copy of the documentary evidence must be made a permanent part of the case record. If an individual has a burial fund that was established prior to application, the value of the burial fund as of the date of application rather than the original amount will be countable toward the resource limit. 20340.3 Prepaid Burial Contracts 20340.3.1 Prepaid Burial Contract Definition 20340.3.2 Burial Funds/Funeral Services 20340.3.3 Burial Space Exclusion 20340.3.1 Prepaid Burial Contract Definition A prepaid burial contract is an agreement entered into in which an individual prepays burial expenses and the seller agrees to furnish the burial. A contract must identify and distinguish between funeral services (burial funds) and burial space items. 20340.3.2 Burial Funds/Funeral Services Funeral services include items and services relative to preparing the body. Such preparation includes, for example, transportation of the body, embalming, cremation, funeral/memorial services, flowers, clothing, etc. 20340.3.3 Burial Space Exclusion Purchased burial space items are excluded. An item is considered purchased even if the specific model number of the item is not mentioned or is not in existence, since the burial space exclusion applies to any burial space item. As long as the contract/agreement results in the individual's right to the items listed, value at the amount indicated, the requirement for exclusion as a burial space is met - a burial space item is being held for the individual (i.e. there was a purchase). A burial space is "held for" an individual when someone currently has: title to and/or possesses a burial space or a contract with a funeral home for specified burial spaces for the individual's burial. Until the purchase price is paid in full, a burial space is not "held for" an individual under an installment contract if: the individual does not currently own the space; the individual does not currently have the right to use the space; the seller is not currently obligated to provide the space. If the burial space is not being currently held for an individual under an installment contract, the amounts paid may be considered burial funds rather than burial space items. 20340.4 Life Insurance Funded Burial Contracts A life insurance funded burial contract involves an individual purchasing a life insurance policy on his life and then assigning, revocably or irrevocably, either the proceeds or ownership of the policy to a funeral provider. The purpose of the assignment is to fund a burial contract. The burial contract itself has no resource value. The value of the burial arrangement is the value of the life insurance policy. 20340.4.1 Revocable Assignment of Ownership The burial space exclusion does not apply if the assignment of ownership is revocable. This is because the funeral provider has not received any payment and no purchase of burial spaces has been made. The burial funds exclusion applies. The resource value is equal to the CSV of the life insurance policy subject to the $1500 burial funds exclusion. 20340.4.2 Irrevocable Assignment of Ownership To determine irrevocability a copy of the "irrevocable assignment of ownership" is required along with a complete copy of the policy and burial contract. Any portion of the contract that represents the purchase of a burial space is excluded. The life insurance policy and the burial contract are not resources because the individual no longer owns them. The face value of the burial funds portion of the contract offsets the $1500 burial funds exclusion because the contract represents an irrevocable arrangement available to meet the individual's burial. 20340.5 Irrevocable Funeral Arrangements Effective January 30, 1992, Delaware law allows the establishment of irrevocable trust accounts for prepaid funerals. The irrevocable trust may represent all funds or any portion of payments made under the burial agreement, contract or plan. The principal sum (excluding accrued interest) may not exceed $5,000. Effective January 1,