§ 38.2-3113.3. Educational loan provisions in life insurance policies.
Educational loan provisions may be included as additional benefits, as partof the policy, or as a rider or as a separate agreement, subject to thefollowing requirements:
1. Any and all necessary eligibility qualifications for an educational loanshall be specified in the life insurance policy, rider or separate agreement.The policy, rider or separate agreement shall also state clearly that theloan will be granted provided the covered individual applying for such loanhas satisfied the stated qualifications. Loan eligibility qualificationsshall not be more restrictive than the following:
a. The loan applicant is a covered individual under the life insurance policy;
b. The purpose of the loan is to provide funds for a covered individual underthe policy, rider or separate agreement, or the dependent of a coveredindividual under the policy, rider or separate agreement to attend aninstitution of higher learning, a trade school or a technical school. As usedin this section, an "institution of higher learning" shall not be definedmore restrictively than an accredited college or university that is alsoapproved by the United States Department of Education. Age eligibility of theindividual for whom the educational loan will be used may be limited to anage range no less restrictive than age fifteen to age twenty-five, subject tocontinued life insurance coverage of the covered individual during thisduration; and
c. The individual for whose education the loan will be used must attend aqualifying institution at least halftime, determined in a manner consistentwith the institution's standards for establishing full-time and half-timeattendance, and must maintain an academic record sufficient to demonstratereasonable progression or advancement.
2. The amount of funds available for an educational loan shall be specifiedin the policy, rider or separate agreement, and shall be further limited toan amount not to exceed the actual cost of the school or institution duringany given year of attendance less other aid received. If the amount availablefor the educational loan varies by the year of attendance in the school orinstitution, this shall be so stated and a schedule of annual loanavailability by dollar amount shall be included in the policy, rider orseparate agreement.
3. The terms of the loan shall be clearly stated in the policy or rider, orthe policy or rider shall refer to the availability of a separate documentspecifying all loan terms upon request of any insured individual. If theterms of the loan are included in a separate document, such document must befiled with the Commission for review. For purposes of this section, "termsof the loan" include, but are not limited to, (i) any and all fees, charges,and interest rates applied to borrowed funds, including a clear statementconcerning possible fluctuation of such fees and charges depending upon theapplicant's credit worthiness and/or depending upon any sources or indicesused to determine such fees, charges or interest rates, (ii) minimum monthlypayments, (iii) maximum amount of years for loan repayment, and (iv) policyassignment, if applicable.
4. Any life insurance policy, rider or separate agreement providing foreducational loans shall include a prominent disclosure advising the reader ofthe prudence of obtaining information about educational loans from a varietyof sources before making any decision about borrowing funds for financinghigher education.
5. No policy, rider or separate agreement providing for educational loansshall be delivered or issued for delivery in this Commonwealth unless a copyof the form has been filed with and approved by the Commission in accordancewith § 38.2-316. No advertising material shall be used in the solicitation orpromotion of the educational loan feature of a life insurance policy, rideror separate agreement until such material has been filed with and approved bythe Commission in the same manner as is required for forms pursuant to §38.2-316.
§ 38.2-3113.3. Educational loan provisions in life insurance policies.
Educational loan provisions may be included as additional benefits, as partof the policy, or as a rider or as a separate agreement, subject to thefollowing requirements:
1. Any and all necessary eligibility qualifications for an educational loanshall be specified in the life insurance policy, rider or separate agreement.The policy, rider or separate agreement shall also state clearly that theloan will be granted provided the covered individual applying for such loanhas satisfied the stated qualifications. Loan eligibility qualificationsshall not be more restrictive than the following:
a. The loan applicant is a covered individual under the life insurance policy;
b. The purpose of the loan is to provide funds for a covered individual underthe policy, rider or separate agreement, or the dependent of a coveredindividual under the policy, rider or separate agreement to attend aninstitution of higher learning, a trade school or a technical school. As usedin this section, an "institution of higher learning" shall not be definedmore restrictively than an accredited college or university that is alsoapproved by the United States Department of Education. Age eligibility of theindividual for whom the educational loan will be used may be limited to anage range no less restrictive than age fifteen to age twenty-five, subject tocontinued life insurance coverage of the covered individual during thisduration; and
c. The individual for whose education the loan will be used must attend aqualifying institution at least halftime, determined in a manner consistentwith the institution's standards for establishing full-time and half-timeattendance, and must maintain an academic record sufficient to demonstratereasonable progression or advancement.
2. The amount of funds available for an educational loan shall be specifiedin the policy, rider or separate agreement, and shall be further limited toan amount not to exceed the actual cost of the school or institution duringany given year of attendance less other aid received. If the amount availablefor the educational loan varies by the year of attendance in the school orinstitution, this shall be so stated and a schedule of annual loanavailability by dollar amount shall be included in the policy, rider orseparate agreement.
3. The terms of the loan shall be clearly stated in the policy or rider, orthe policy or rider shall refer to the availability of a separate documentspecifying all loan terms upon request of any insured individual. If theterms of the loan are included in a separate document, such document must befiled with the Commission for review. For purposes of this section, "termsof the loan" include, but are not limited to, (i) any and all fees, charges,and interest rates applied to borrowed funds, including a clear statementconcerning possible fluctuation of such fees and charges depending upon theapplicant's credit worthiness and/or depending upon any sources or indicesused to determine such fees, charges or interest rates, (ii) minimum monthlypayments, (iii) maximum amount of years for loan repayment, and (iv) policyassignment, if applicable.
4. Any life insurance policy, rider or separate agreement providing foreducational loans shall include a prominent disclosure advising the reader ofthe prudence of obtaining information about educational loans from a varietyof sources before making any decision about borrowing funds for financinghigher education.
5. No policy, rider or separate agreement providing for educational loansshall be delivered or issued for delivery in this Commonwealth unless a copyof the form has been filed with and approved by the Commission in accordancewith § 38.2-316. No advertising material shall be used in the solicitation orpromotion of the educational loan feature of a life insurance policy, rideror separate agreement until such material has been filed with and approved bythe Commission in the same manner as is required for forms pursuant to §38.2-316.
§ 38.2-3113.3. Educational loan provisions in life insurance policies.
Educational loan provisions may be included as additional benefits, as partof the policy, or as a rider or as a separate agreement, subject to thefollowing requirements:
1. Any and all necessary eligibility qualifications for an educational loanshall be specified in the life insurance policy, rider or separate agreement.The policy, rider or separate agreement shall also state clearly that theloan will be granted provided the covered individual applying for such loanhas satisfied the stated qualifications. Loan eligibility qualificationsshall not be more restrictive than the following:
a. The loan applicant is a covered individual under the life insurance policy;
b. The purpose of the loan is to provide funds for a covered individual underthe policy, rider or separate agreement, or the dependent of a coveredindividual under the policy, rider or separate agreement to attend aninstitution of higher learning, a trade school or a technical school. As usedin this section, an "institution of higher learning" shall not be definedmore restrictively than an accredited college or university that is alsoapproved by the United States Department of Education. Age eligibility of theindividual for whom the educational loan will be used may be limited to anage range no less restrictive than age fifteen to age twenty-five, subject tocontinued life insurance coverage of the covered individual during thisduration; and
c. The individual for whose education the loan will be used must attend aqualifying institution at least halftime, determined in a manner consistentwith the institution's standards for establishing full-time and half-timeattendance, and must maintain an academic record sufficient to demonstratereasonable progression or advancement.
2. The amount of funds available for an educational loan shall be specifiedin the policy, rider or separate agreement, and shall be further limited toan amount not to exceed the actual cost of the school or institution duringany given year of attendance less other aid received. If the amount availablefor the educational loan varies by the year of attendance in the school orinstitution, this shall be so stated and a schedule of annual loanavailability by dollar amount shall be included in the policy, rider orseparate agreement.
3. The terms of the loan shall be clearly stated in the policy or rider, orthe policy or rider shall refer to the availability of a separate documentspecifying all loan terms upon request of any insured individual. If theterms of the loan are included in a separate document, such document must befiled with the Commission for review. For purposes of this section, "termsof the loan" include, but are not limited to, (i) any and all fees, charges,and interest rates applied to borrowed funds, including a clear statementconcerning possible fluctuation of such fees and charges depending upon theapplicant's credit worthiness and/or depending upon any sources or indicesused to determine such fees, charges or interest rates, (ii) minimum monthlypayments, (iii) maximum amount of years for loan repayment, and (iv) policyassignment, if applicable.
4. Any life insurance policy, rider or separate agreement providing foreducational loans shall include a prominent disclosure advising the reader ofthe prudence of obtaining information about educational loans from a varietyof sources before making any decision about borrowing funds for financinghigher education.
5. No policy, rider or separate agreement providing for educational loansshall be delivered or issued for delivery in this Commonwealth unless a copyof the form has been filed with and approved by the Commission in accordancewith § 38.2-316. No advertising material shall be used in the solicitation orpromotion of the educational loan feature of a life insurance policy, rideror separate agreement until such material has been filed with and approved bythe Commission in the same manner as is required for forms pursuant to §38.2-316.
