Missouri Revised Statutes













Chapter 376

Life, Health and Accident Insurance

←376.350

Section 376.360.1

376.365→

August 28, 2015

Distribution of surplus funds to participating policyholders--method.

376.360. 1. All life insurance companies organized under the laws of

this state shall ascertain and distribute annually, and not otherwise,

beginning not later than the end of the third policy year, the proportion of

any surplus accruing upon every participating policy or contract issued on or

after January 1, 1946, entitled as herein provided to share in such surplus.

Upon the thirty-first day of December of each year, or as soon thereafter as

may be practicable, every such company shall well and truly ascertain the

surplus earned by it during the year.



2. After setting aside from such surplus such sums as may be required

for the payment of authorized dividends upon the capital stock, if any, such

sums as may properly be held for account of outstanding deferred dividend

policies, if any, and such sums as may be deemed advisable for the

accumulation of a surplus in an amount not exceeding five hundred thousand

dollars, or ten percent of its policy reserves and policy liabilities,

whichever shall be greater, every such company shall thereupon apportion the

remainder of such surplus earnings, if any, derived from participating

policies or contracts, as the board of directors charged with the management

of the company's affairs may determine, to all policies or contracts entitled

to share therein during the full dividend year adopted by the company for

such purpose beginning not later than the following July first.



3. Dividends apportioned as aforesaid in the case of a policy or

contract, other than an industrial life insurance policy, issued on or after

the first day of January, 1946, shall, unless otherwise provided in the

policy or contract, be payable upon the anniversary of the policy or contract

occurring within the dividend year selected by the company, as aforesaid; and

in every case after the first policy or contract year such dividend shall be

payable upon the sole condition that the premium payments of the policy or

contract year current upon the first day of the dividend year selected by the

company, as aforesaid, shall have been completed. Such apportionment in the

case of any policy or contract shall not, after the first policy year, be

made contingent upon the payment of the whole or any part of the premium for

any subsequent year.



4. (1) Except as herein provided, the dividend so apportioned in the

case of any participating policy issued on or after the first day of January,

1946, shall, at the option of the person entitled to elect such option, be

either



(a) Payable in cash; or



(b) Applicable to the payment of any premium or premiums upon said

policy; or



(c) Permitted to accumulate to the credit of the policy or contract at

such rate of interest as may be allowed by the company, and with such

interest shall be payable upon the maturity of the policy or shall be

withdrawable in cash on any anniversary of the date of issue thereof; or



(d) If so provided in the policy, applicable to any paid-up addition

thereto.



(2) Unless the insured or owner of the policy notifies the company in

writing of his election of one of the foregoing options within the time

allowed by the policy, which shall not, in any event, be a period of less

than thirty-one days after the dividend apportioned thereto is payable, the

effective option shall be that stated in the policy.



5. In case of any extended term or reduced paid-up insurance, the

dividends so apportioned, if any, shall be applicable as provided in the

policy with the approval of the director of the department of insurance,

financial institutions and professional registration. In the case of an

individual participating term policy issued on or after the first day of

January, 1946, the dividend so apportioned shall, at the option of the

policyholder, be paid or applied pursuant to paragraph (a) or (b) of

subdivision (1) of subsection 4, or, if the policy so provides, pursuant to

paragraph (c) of subdivision (1) of subsection 4. In the case of every

individual participating annuity or pure endowment contract the dividend so

apportioned shall be applicable, at the election of the holder of such

contract, in accordance with the options specified in paragraph (a) or (b) of

subdivision (1) of subsection 4, or, if the contract so provides, paragraph

(c) of subdivision (1) of subsection 4, if such option is applicable to the

type of contract in question. In the case of every individual participating

accident or health insurance policy, the dividend so apportioned shall be

applicable in accordance with the option specified in paragraph (a) of

subdivision (1) of subsection 4. In the case of any participating group

insurance policy or of any participating group annuity contract, the dividend

so apportioned shall, at the option of the policyholder or holder of the

master contract, be applied pursuant to paragraph (a) or (b) of subdivision

(1) of subsection 4 above. In the case of participating industrial life

insurance policies, paragraphs (a), (b), (c) and (d) of subdivision (1) of

subsection 4 shall not be applicable, but the dividends apportioned on such

policies shall be distributed annually in such manner as may be determined by

the company with the approval of the director of the department of insurance,

financial institutions and professional registration.



6. No stock or stock and mutual life insurance company organized under

the laws of this state shall issue, on or after January 1, 1946, any

participating policy or contract which does not by its terms give the right

to participate in the divisible surplus earnings of such company as provided

herein. No mutual life insurance company organized under the laws of this

state shall issue, on or after January 1, 1946, any policy or contract, except

as herein provided, which does not by its terms give the right to participate

in the divisible surplus earnings of such company as provided herein.



7. Both participating and nonparticipating policies or contracts may

provide that in addition to any rate of interest guaranteed by the issuing

company to be paid on deferred payments of the proceeds thereof, additional

interest may be paid thereon at such rate as the company may annually

declare; and the inclusion of such provision in any nonparticipating policy

shall not be deemed to make the policy participating. With this exception,

the inclusion in any policy or contract of any provision to the effect that

the owner thereof shall participate in the surplus of the company issuing

such policy or contract, shall be deemed to make such policy or contract a

participating one, except, that nonparticipating policies, which provide that

they may be exchanged for or converted to paid-up participating policies

after the completion of premium payments of a given term of years, shall not

be deemed to be participating policies until participation begins according

to the terms of the policy.



8. This section shall not be deemed to require the apportionment or

distribution of dividends on any immediate annuity contract, nor on any

deferred annuity contract for the period following the period of deferment of

annuity payments, in accordance with the provisions of such contract, nor on

any policy of accident or health insurance, nor on extended term insurance, or

pure endowment or reduced paid-up life or endowment insurance which take

effect in the event of default in the payment of a premium on any policy or

contract, nor on any paid-up additions purchased by dividends, nor on any

contract or agreement of reinsurance.



(RSMo 1939 § 5830, A.L. 1945 p. 1001)



Prior revisions: 1929 § 5719; 1919 § 6130; 1909 § 6924







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