Section 7807. Disclosure

(a)  The  application for a viatical settlement
  shall contain a notice,  prominently  displayed,  to  read  as  follows:
  "Receipt  of  payment  pursuant  to  a  viatical  settlement  may affect
  eligibility for public assistance programs such  as  medical  assistance
  (medicaid),  family assistance, supplementary social security income and
  AIDS drug assistance programs and may be taxable. Prior to applying  for
  a  viatical settlement, policyowners should consult with the appropriate
  social  services  agency  concerning  how  receipt   will   affect   the
  eligibility  of  the recipient and the recipient's spouse or dependents,
  and with a qualified tax adviser."
    (b) Upon receipt of an application  for  a  viatical  settlement,  the
  viatical   settlement   company   shall  deliver  to  the  applicant  an
  information booklet describing:
    (1) how viatical settlements operate;
    (2) possible alternatives to viatical  settlements  for  persons  with
  catastrophic  or  life-threatening illnesses, including, but not limited
  to, accelerated benefits offered by the issuer  of  the  life  insurance
  policy and loans secured by the life insurance policy;
    (3)  tax  consequences  that  may result from entering into a viatical
  settlement;
    (4) consequences of interruption of assistance as provided by  medical
  or public assistance programs;
    (5) the viator's right to rescind a viatical settlement within fifteen
  days of receipt of the viatical settlement proceeds; and
    (6)   the  identity  of  any  person  who  will  receive  any  fee  or
  compensation from the viatical settlement company with  respect  to  the
  viatical settlement and the amount and terms of such compensation.