§ 38.2-3212. Same; policies issued on or after January 1, 1986.
A. This section, in addition to all other applicable sections of law, shallapply to all policies issued on or after January 1, 1986. Any cash surrendervalue available under the policy in the event of default in a premium paymentdue on any policy anniversary shall not differ by more than two-tenthspercent of either (i) the amount of insurance, if the insurance is uniform inamount, or (ii) the average amount of insurance at the beginning of each ofthe first ten policy years, from the sum of (i) the greater of zero and thebasic cash value specified in this section and (ii) the present value of anyexisting paid-up additions less the amount of any indebtedness to the insurerunder the policy.
B. The basic cash value shall equal the present value on that anniversary ofthe future guaranteed benefits that would have been provided for by thepolicy, excluding any existing paid-up additions and before deduction of anyindebtedness to the insurer, if there had been no default, less the thenpresent value of the nonforfeiture factors, as defined in this section,corresponding to premiums that would have fallen due on and after thatanniversary. However, the effects on the basic cash value of supplementallife insurance or annuity benefits or of family coverage, as described in §38.2-3203 or § 38.2-3205, whichever applies, shall be the same as the effectsspecified in § 38.2-3203 or § 38.2-3205, whichever applies, on the cashsurrender values defined in those sections.
C. 1. The nonforfeiture factor for each policy year shall equal a percentageof the adjusted premium for the policy year, as defined in § 38.2-3205 or §38.2-3209, whichever applies. Except as required by subdivision 2 of thissubsection, such percentage:
a. Shall be the same percentage for each policy year between the secondpolicy anniversary and the later of (i) the fifth policy anniversary and (ii)the first policy anniversary at which there is available under the policy acash surrender value in an amount, before including any paid-up additions andbefore deducting any indebtedness, of at least two-tenths percent of eitherthe amount of insurance, if the insurance is uniform in amount, or theaverage amount of insurance at the beginning of each of the first ten policyyears; and
b. Shall be such that no percentage after the later of the two policyanniversaries specified in subdivision 1 a of this subsection may apply tofewer than five consecutive policy years.
2. No basic cash value shall be less than the value that would be obtained ifthe adjusted premiums for the policy, as defined in § 38.2-3205 or §38.2-3209, whichever applies, were substituted for the nonforfeiture factorsin the calculation of the basic cash value.
D. All adjusted premiums and present values referred to in this section shallfor a particular policy be calculated on the same mortality and interestbases used in demonstrating the policy's compliance with the other sectionsof this article. The cash surrender values referred to in this section shallinclude any endowment benefits provided for by the policy.
E. Any cash surrender value available other than in the event of default in apremium payment due on a policy anniversary, and the amount of any paid-upnonforfeiture benefit available under the policy in the event of default in apremium payment, shall be determined by a method consistent with the methodsspecified for determining the analogous minimum amounts in §§ 38.2-3202through 38.2-3204, 38.2-3209 and 38.2-3211. The amounts of any cash surrendervalues and of any paid-up nonforfeiture benefits granted in connection withadditional benefits, such as those listed as B1 a through B1 f in §38.2-3211, shall conform with the principles of this section.
§ 38.2-3212. Same; policies issued on or after January 1, 1986.
A. This section, in addition to all other applicable sections of law, shallapply to all policies issued on or after January 1, 1986. Any cash surrendervalue available under the policy in the event of default in a premium paymentdue on any policy anniversary shall not differ by more than two-tenthspercent of either (i) the amount of insurance, if the insurance is uniform inamount, or (ii) the average amount of insurance at the beginning of each ofthe first ten policy years, from the sum of (i) the greater of zero and thebasic cash value specified in this section and (ii) the present value of anyexisting paid-up additions less the amount of any indebtedness to the insurerunder the policy.
B. The basic cash value shall equal the present value on that anniversary ofthe future guaranteed benefits that would have been provided for by thepolicy, excluding any existing paid-up additions and before deduction of anyindebtedness to the insurer, if there had been no default, less the thenpresent value of the nonforfeiture factors, as defined in this section,corresponding to premiums that would have fallen due on and after thatanniversary. However, the effects on the basic cash value of supplementallife insurance or annuity benefits or of family coverage, as described in §38.2-3203 or § 38.2-3205, whichever applies, shall be the same as the effectsspecified in § 38.2-3203 or § 38.2-3205, whichever applies, on the cashsurrender values defined in those sections.
C. 1. The nonforfeiture factor for each policy year shall equal a percentageof the adjusted premium for the policy year, as defined in § 38.2-3205 or §38.2-3209, whichever applies. Except as required by subdivision 2 of thissubsection, such percentage:
a. Shall be the same percentage for each policy year between the secondpolicy anniversary and the later of (i) the fifth policy anniversary and (ii)the first policy anniversary at which there is available under the policy acash surrender value in an amount, before including any paid-up additions andbefore deducting any indebtedness, of at least two-tenths percent of eitherthe amount of insurance, if the insurance is uniform in amount, or theaverage amount of insurance at the beginning of each of the first ten policyyears; and
b. Shall be such that no percentage after the later of the two policyanniversaries specified in subdivision 1 a of this subsection may apply tofewer than five consecutive policy years.
2. No basic cash value shall be less than the value that would be obtained ifthe adjusted premiums for the policy, as defined in § 38.2-3205 or §38.2-3209, whichever applies, were substituted for the nonforfeiture factorsin the calculation of the basic cash value.
D. All adjusted premiums and present values referred to in this section shallfor a particular policy be calculated on the same mortality and interestbases used in demonstrating the policy's compliance with the other sectionsof this article. The cash surrender values referred to in this section shallinclude any endowment benefits provided for by the policy.
E. Any cash surrender value available other than in the event of default in apremium payment due on a policy anniversary, and the amount of any paid-upnonforfeiture benefit available under the policy in the event of default in apremium payment, shall be determined by a method consistent with the methodsspecified for determining the analogous minimum amounts in §§ 38.2-3202through 38.2-3204, 38.2-3209 and 38.2-3211. The amounts of any cash surrendervalues and of any paid-up nonforfeiture benefits granted in connection withadditional benefits, such as those listed as B1 a through B1 f in §38.2-3211, shall conform with the principles of this section.
§ 38.2-3212. Same; policies issued on or after January 1, 1986.
A. This section, in addition to all other applicable sections of law, shallapply to all policies issued on or after January 1, 1986. Any cash surrendervalue available under the policy in the event of default in a premium paymentdue on any policy anniversary shall not differ by more than two-tenthspercent of either (i) the amount of insurance, if the insurance is uniform inamount, or (ii) the average amount of insurance at the beginning of each ofthe first ten policy years, from the sum of (i) the greater of zero and thebasic cash value specified in this section and (ii) the present value of anyexisting paid-up additions less the amount of any indebtedness to the insurerunder the policy.
B. The basic cash value shall equal the present value on that anniversary ofthe future guaranteed benefits that would have been provided for by thepolicy, excluding any existing paid-up additions and before deduction of anyindebtedness to the insurer, if there had been no default, less the thenpresent value of the nonforfeiture factors, as defined in this section,corresponding to premiums that would have fallen due on and after thatanniversary. However, the effects on the basic cash value of supplementallife insurance or annuity benefits or of family coverage, as described in §38.2-3203 or § 38.2-3205, whichever applies, shall be the same as the effectsspecified in § 38.2-3203 or § 38.2-3205, whichever applies, on the cashsurrender values defined in those sections.
C. 1. The nonforfeiture factor for each policy year shall equal a percentageof the adjusted premium for the policy year, as defined in § 38.2-3205 or §38.2-3209, whichever applies. Except as required by subdivision 2 of thissubsection, such percentage:
a. Shall be the same percentage for each policy year between the secondpolicy anniversary and the later of (i) the fifth policy anniversary and (ii)the first policy anniversary at which there is available under the policy acash surrender value in an amount, before including any paid-up additions andbefore deducting any indebtedness, of at least two-tenths percent of eitherthe amount of insurance, if the insurance is uniform in amount, or theaverage amount of insurance at the beginning of each of the first ten policyyears; and
b. Shall be such that no percentage after the later of the two policyanniversaries specified in subdivision 1 a of this subsection may apply tofewer than five consecutive policy years.
2. No basic cash value shall be less than the value that would be obtained ifthe adjusted premiums for the policy, as defined in § 38.2-3205 or §38.2-3209, whichever applies, were substituted for the nonforfeiture factorsin the calculation of the basic cash value.
D. All adjusted premiums and present values referred to in this section shallfor a particular policy be calculated on the same mortality and interestbases used in demonstrating the policy's compliance with the other sectionsof this article. The cash surrender values referred to in this section shallinclude any endowment benefits provided for by the policy.
E. Any cash surrender value available other than in the event of default in apremium payment due on a policy anniversary, and the amount of any paid-upnonforfeiture benefit available under the policy in the event of default in apremium payment, shall be determined by a method consistent with the methodsspecified for determining the analogous minimum amounts in §§ 38.2-3202through 38.2-3204, 38.2-3209 and 38.2-3211. The amounts of any cash surrendervalues and of any paid-up nonforfeiture benefits granted in connection withadditional benefits, such as those listed as B1 a through B1 f in §38.2-3211, shall conform with the principles of this section.
