§4120. Life benefit certificate provisions, standard and prohibited

Link to law: http://legislature.maine.gov/legis/statutes/24-A/title24-Asec4120.html
Published: 2015

§4120. Life benefit certificate provisions, standard and prohibited






No life benefit certificate may be delivered or issued for delivery in this State
unless a copy of the form shall have been filed with the superintendent and approved
by him as conforming to the requirements of this section and not inconsistent with
any other provisions of law applicable thereto. For each such form filing, the society
shall pay the superintendent a fee which shall be the same as for an insurer, as provided
in section 601. A certificate shall be deemed approved unless disapproved by the superintendent
within 60 days from the date of that filing. [1983, c. 419, §11 (AMD).]








1. 
 
The certificate shall contain in substance the following standard provisions or, in
lieu thereof, provisions which are more favorable to the member:





A. Title on the face and filing page of the certificate clearly and correctly describing
its form; [1969, c. 132, §1 (NEW).]










B. A provision stating the amount of rates, premiums or other required contributions,
by whatever name known, which are payable by the insured under the certificate; [1969, c. 132, §1 (NEW).]










C. A provision that the member is entitled to a grace period of not less than a full
month, or 30 days at the option of the society, in which the payment of any premium
after the first may be made. During such grace period the certificate shall continue
in full force, but in case the certificate becomes a claim during the grace period
before the overdue payment is made, the amount of such overdue payment or payments
may be deducted in any settlement under the certificate; [1969, c. 132, §1 (NEW).]










D. A provision that the member shall be entitled to have the certificate reinstated at
any time within 3 years from the due date of the premium in default, unless the certificate
has been completely terminated through the application of a nonforfeiture benefit,
cash surrender value or certificate loan, upon the production of evidence of insurability
satisfactory to the society and the payment of all overdue premiums with interest
at a rate not exceeding 6% per annum compounded annually, and the payment or reinstatement
of any other indebtedness to the society upon the certificate with interest at a rate
determined under the terms of the certificate in accordance with sections 2552 to
2554; [1981, c. 188, §5 (AMD).]










E. Except in the case of pure endowment, annuity or reversionary annuity contracts, reducing
term insurance contracts, or contracts of term insurance of uniform amount of 15 years
or less expiring before age 66, a provision that, in the event of default in payment
of any premium after 3 full years' premiums have been paid or after premiums for a
lesser period have been paid if the contract so provides, the society will grant,
upon proper request not later than 60 days after the due date of the premium in default,
a paid-up nonforfeiture benefit on the plan stipulated in the certificate, effective
as of such due date, of such value as specified in this chapter. The certificate may
provide, if the society's laws so specify or if the member shall so elect prior to
the expiration of the grace period of any overdue premium, that default shall not
occur so long as premiums can be paid under the provisions of an arrangement for automatic
premium loan as may be set forth in the certificate; [1969, c. 132, §1 (NEW).]










F. A provision that one paid-up nonforfeiture benefit as specified in the certificate
shall become effective automatically unless the member elects another available paid-up
nonforfeiture benefit, not later than 60 days after the due date of the premium in
default; [1969, c. 132, §1 (NEW).]










G. A statement of the mortality table and rate of interest used in determining all paid-up
nonforfeiture benefits and cash surrender options available under the certificate,
and a brief general statement of the method used in calculating such benefits; [1969, c. 132, §1 (NEW).]










H. A table showing in figures the value of every paid-up nonforfeiture benefit and cash
surrender option available under the certificate for each certificate anniversary
either during the first 20 certificate years or during the term of the certificate
whichever is shorter; [1969, c. 132, §1 (NEW).]










I. A provision that the certificate shall be incontestable after it has been in force
during the lifetime of the member for a period of 2 years from its date of issue except
for nonpayment of premiums, violation of the provisions of the certificate relating
to military, aviation or naval service and violation of the provisions relating to
suspension or expulsion as substantially set forth in the certificate. At the option
of the society, supplemental provisions relating to benefits in the event of temporary
or permanent disability or hospitalization and provisions which grant additional insurance
specifically against death by accident or accidental means may also be excepted. The
certificate shall be incontestable on the ground of suicide after it has been in force
during the lifetime of the member for a period of 2 years from date of issue. The
certificate may provide, as to statements made to procure reinstatement, that the
society shall have the right to contest a reinstated certificate within a period of
2 years from date of reinstatement with the same exceptions as herein provided; [1969, c. 132, §1 (NEW).]










J. A provision that in case the age or sex of the member or of any other person is considered
in determining the premium and it is found at any time before final settlement under
the certificate that the age or sex has been misstated, and the discrepancy and premium
involved have not been adjusted, the amount payable shall be such as the premium would
have purchased at the correct age and sex; but if the correct age or sex was not an
insurable age or sex under the society's charter or laws, only the premiums paid to
the society, less any payments previously made to the member, shall be returned or,
at the option of the society, the amount payable under the certificate shall be such
as the premium would have purchased at the correct age and sex according to the society's
promulgated rates and any extension thereof based on actuarial principles; [1969, c. 132, §1 (NEW).]










K. A provision or provisions which recite fully, or which set forth the substance of,
all sections of the charter, constitution, laws, rules or regulations of the society,
in force at the time of issuance of the certificate, the violation of which will result
in the termination of, or in the reduction of, the benefit or benefits payable under
the certificate; and [1969, c. 132, §1 (NEW).]










L. If the constitution or laws of the society provide for expulsion or suspension of a member, any member so expelled or suspended, except for nonpayment
of a premium or within the contestable period for material misrepresentations in such
member's application for membership, must have the privilege of maintaining the member's insurance in force by continuing payment of the required premium. [RR 2015, c. 1, §30 (COR).]







Any of the foregoing provisions or portions thereof not applicable by reason of the
plan of insurance or because the certificate is an annuity certificate may to the
extent inapplicable be omitted from the certificate.


[
RR 2015, c. 1, §30 (COR)
.]








2. 
 
No life benefit certificate may be delivered or issued for delivery in this State
containing in substance any of the following provisions:





A. Any provision limiting the time within which any action at law or in equity may
be commenced to less than 2 years after the cause of action shall accrue; [1969, c. 132, §1 (NEW).]










B. Any provision by which the certificate shall purport to be issued or to take effect
more than 6 months before the original application for the certificate was made, except
in case of transfer from one form of certificate to another in connection with which
the member is to receive credit for any reserve accumulation under the form of certificate
from which the transfer is made; [1989, c. 176, §7 (AMD).]










C. Any provision for forfeiture of the certificate for failure to repay any loan thereon
or to pay interest on such loan while the total indebtedness, including interest,
is less than the loan value of the certificate; or [1989, c. 176, §7 (AMD).]










D. Any provision providing more restrictive coverage or excluding coverage for death
resulting from Acquired Immune Deficiency Syndrome (AIDS), AIDS Related Complex (ARC)
or HIV related diseases except this provision shall not apply to death by accident
or accidental means. [1989, c. 176, §7 (NEW).]







[
1989, c. 176, §7 (AMD)
.]








3. 
 
The word "premiums" as used in this chapter means premiums, rates or other required
contributions by whatever name known.


[
1969, c. 132, §1 (NEW)
.]





SECTION HISTORY

1969, c. 132, §1 (NEW).
1973, c. 585, §12 (AMD).
1981, c. 188, §5 (AMD).
1983, c. 419, §11 (AMD).
1989, c. 176, §7 (AMD).
RR 2015, c. 1, §30 (COR).
Read Entire Law on legislature.maine.gov