NY Insurance Law, Article 32, Insurance Contracts, Life, Accident, Health Annuities

S 3201. Approval of life, accident and health, credit unemployment, and annuity policy forms. (a) In this article, "policy form" means any policy, contract, certificate, or evidence of insurance and any application therefor, or rider or endorsement thereto, affording benefits of the kinds of insurance specified in paragraph one, two, three or twenty-four of subsection (a) of section one thousand one hundred thirteen of this chapter, a group annuity certificate to which subsection (a) of section three thousand two hundred nineteen of this article applies, and a funding agreement authorized by section three thousand two hundred twenty-two of this article. The term "policy form" shall not include an agreement, special rider, or endorsement relating only to the manner of distribution of benefits or to the reservation of rights and benefits used at the request of the individual policyholder, contract holder or certificate holder. (b) (1) No policy form shall be delivered or issued for delivery in this state unless it has been filed with and approved by the superintendent as conforming to the requirements of this chapter and not inconsistent with law. A group life, group accident, group health, group accident and health or blanket accident and health insurance certificate evidencing insurance coverage on a resident of this state shall be deemed to have been delivered in this state, regardless of the place of actual delivery, unless the insured group is of the type described in: (A) section four thousand two hundred sixteen, except paragraph four where the group policy is issued to a trustee or trustees of a fund established or participated in by two or more employers not in the same industry with respect to an employer principally located within the state, paragraph twelve, thirteen or fourteen of subsection (b) thereof; (B) section four thousand two hundred thirty-five except subparagraph (D) where the group policy is issued to a trustee or trustees of a fund established or participated in by two or more employers not in the same industry with respect to an employer principally located within the state, subparagraph (K), (L) or (M) of paragraph one of subsection (c) thereof; or (C) section four thousand two hundred thirty-seven (except subparagraph (F) of paragraph three of subsection (a) thereof; of this chapter; and where the master policies or contracts were lawfully issued without this state in a jurisdiction where the insurer was authorized to do an insurance business. With regard to any certificate deemed to have been delivered in this state by virtue of this paragraph, the superintendent shall (i) require that the premiums charged be reasonable in relation to the benefits provided, except in cases where the policyholder pays the entire premium; (ii) have power to issue regulations prescribing the required, optional and prohibited provisions in such certificates; (iii) establish an accelerated certificate form approval procedure available to an insurer which includes a statement in its policy form submission letter that it is the company`s opinion that the certificate form or forms comply with applicable New York law and regulations. The superintendent, upon receipt of such a filing letter, shall grant conditional approval of such certificate form or forms in reliance on the aforementioned statement by the company upon the condition that the company will retroactively modify such certificate form or forms, to the extent necessary, if it is found by the superintendent that the certificate form fails to comply with applicable New York laws and regulations. The superintendent may, with regard to the approval of any certificate deemed to have been delivered in this state by virtue of this paragraph, approve such certificate if the superintendent finds that the certificate affords insureds protections substantially similar to those which have been provided by certificates delivered in this state. Any regulations issued by the superintendent pursuant to this paragraph may not impose stricter requirements than those applicable to similar policies and certificates actually delivered in this state. (2) No policy form shall be issued by a domestic insurer for delivery outside this state unless it has been filed with the superintendent. (3) In exercising the authority granted by this subsection and by subsection (c) hereof, with respect to a policy or certificate form under which additional amounts may be credited pursuant to subsection (b) of section four thousand two hundred thirty-two or section four thousand five hundred eighteen of this chapter, the superintendent shall take into account the tax aspects of the policy form as they relate to all parties concerned. (4) (A) No credit insurance or credit unemployment insurance policy form shall be issued unless it and its premium rates have been filed with and approved by the superintendent. In this section "credit insurance" and "credit unemployment insurance" mean insurance on a debtor, including an intended borrower, pursuant to a program as defined in paragraph three of subsection (b) of section four thousand two hundred sixteen of this chapter for defraying the costs of attendance of a student at a college or university, in connection with a specified loan or other credit transaction to provide payment to the creditor in the event of the death of the debtor or indemnity to the creditor for the installment payments on the indebtedness becoming due while the debtor is disabled as defined in the policy, or payment to the creditor for the installment payments on the indebtedness becoming due while the debtor is unemployed as set forth in section three thousand four hundred thirty-six of this chapter. (B) The superintendent shall from time to time prescribe regulations which, among other things, shall require that, in the event of the termination of the insurance prior to the scheduled maturity date of the indebtedness or the last maturing instalment thereof, there shall be an appropriate refund by the insurer to the policyholder of any amount collected from or charged to the policyholder for such terminated insurance, and an appropriate refund or credit by the policyholder or creditor to the debtor of an amount collected from or charged to the debtor for such terminated insurance, if such refund amounts to one dollar or more. (5) Notwithstanding the other provisions of this section, on and after June first, nineteen hundred eighty no policy form of industrial life insurance, industrial accident insurance or industrial health insurance shall be approved by the superintendent for delivery or issuance for delivery in this state. (6) (A) As an alternative procedure to the policy form filing requirements of paragraph (1) of this subsection, an insurer has the option to file an expedited policy form approval application with the superintendent pursuant to this paragraph. If this option is elected, the filing shall include the proposed policy form, including rates as required, and all necessary supporting material requested by the superintendent pursuant to rule, and a certification signed by an officer of the insurer, who is knowledgeable with respect to the law and regulation applicable to the type of policy form, that such form is in compliance with the applicable law and regulations to the best of his or her knowledge and belief. Within ninety days of receipt of a filing, the superintendent shall, in writing, either approve, submit a detailed list to the insurer requesting all additional information necessary to make a determination on the filing, or deny such filing, otherwise, such filing shall be deemed approved. Any denial issued by the superintendent shall state the reasons for such disapproval. If an insurer does not provide the additional information requested by the superintendent, or respond to the superintendent`s objections within forty-five days of receipt of such request or denial, then such filing shall be deemed denied and such filing may not be resubmitted for a period not to exceed ninety days from the date that such information or response was due. The forty-five day limit for providing such additional information or response may be extended at the option of the superintendent. In the event that an insurer properly submits the additional information or response, then such filing shall be deemed approved forty-five days after receipt of such information or response by the superintendent, unless the insurer is notified in writing prior to such date that the filing has been denied. Such denial shall state the reasons for such disapproval and cannot be based on any objection not specified in the superintendent`s initial review of the filing, unless the objection arises from a modification of the policy forms made by the insurer in addressing the objections or new material submitted by the insurer. Notwithstanding anything to the contrary contained in this section, the superintendent may, at any time, before the filing is either deemed approved, affirmatively approved, or denied, raise objections to the policy form that is based on the explicit requirements of this chapter and any applicable regulations. The superintendent shall, as soon as practicable, but no later than sixty days after receipt of the filing, notify the insurer if its filing is incomplete or fails to comply with applicable statutory or regulatory requirements. Such notice shall indicate that the filing is being returned with no action by the superintendent and that the period for the superintendent`s substantive review has not commenced. (B) Nothing contained in this paragraph shall prohibit the superintendent from requiring an insurer to retroactively modify or withdraw a form approved pursuant to the expedited filing procedure if such form is found to fail to conform with the requirements of this chapter, provided that the order to withdraw or modify such form is issued in accordance with the provisions of section three thousand one hundred ten or section three thousand two hundred two of this chapter. (C) In addition to any penalties for violations contained in this chapter, any insurer which receives approval under this subsection for a form which is found to fail to comply with the provisions of this chapter shall be ineligible to apply for an expedited review under this subsection for a period not to exceed one year. (c) (1) The superintendent may disapprove any policy form for delivery or issuance for delivery in this state if he finds that the same contains any provision or has any title, heading, backing or other indication of the contents of any or all of its provisions, which is likely to mislead the policyholder, contract holder or certificate holder. (2) The superintendent may disapprove any life insurance policy form, or any form of annuity contract or group annuity certificate, or any form of funding agreement for delivery or issuance for delivery in this state, if its issuance would be prejudicial to the interests of policyholders or members or it contains provisions which are unjust, unfair or inequitable. (3) The superintendent may disapprove any accident and health insurance policy form for delivery or issuance for delivery in this state if the benefits provided therein are unreasonable in relation to the premium charged or any such form contains provisions which encourage misrepresentation or are unjust, unfair, inequitable, misleading, deceptive, or contrary to law or to the public policy of this state. (4) The superintendent shall not approve any life insurance policy form containing any war or travel exclusion or restriction, for delivery or issuance for delivery in this state, unless such policy form shall have printed or stamped across its face in red and in capital letters not smaller than twelve point type the following: "Read your policy (certificate) carefully. "Certain (war, travel) risks are not assumed. __________________________________ (state which or both) In case of any doubt write your company (society) for further explanation." (5) The superintendent shall not approve any annuity or life insurance policy form which is subject to the provisions of section four thousand two hundred twenty, four thousand two hundred twenty-one or four thousand five hundred eleven of this chapter, unless a detailed statement of the method used by the insurer in calculating any cash surrender value and any paid-up nonforfeiture benefit in the policy form is stated therein or, in lieu thereof, a statement that such method of computation has been filed with the insurance supervisory official of the state in which the policy form is delivered, and unless a statement of the method to be used in calculating the cash surrender value and paid-up nonforfeiture benefit available on any anniversary beyond the last anniversary for which such value and benefits are consecutively shown in the policy form is included therein, and, with respect to policy forms under which additional amounts may be credited pursuant to subsection (b) of section four thousand two hundred thirty-two or section four thousand five hundred eighteen of this chapter, the insurer shall also furnish such further information to the superintendent as the superintendent may require. (6) The superintendent may disapprove any policy form issued by a domestic life insurer or fraternal benefit society for delivery outside the state if its issuance would be prejudicial to the interests of its policyholders or members. (7) If any policy of individual accident and health insurance is issued by an insurer domiciled in this state for delivery to a person residing in another state, and if the official having responsibility for the administration of the insurance laws of such other state shall have advised the superintendent that any such policy form is not subject to approval or disapproval by such official, the superintendent may by ruling require that such policy form meet the standards set forth in subsections (c) and (d) of section three thousand two hundred sixteen of this article. (8) Without limitation on his other powers and duties under this section, the superintendent shall not approve any credit insurance or credit unemployment insurance policy forms or premium rates if the premium rates are unreasonable in relation to the benefits provided. (9) Each insurer shall file with the superintendent of insurance any change in the premium rates for policies authorized under subparagraph (J) of paragraph one of subsection (c) of section four thousand two hundred thirty-five of this chapter, and the same shall be subject to his approval. (10) The superintendent shall not approve any form of life insurance policy that is subject to the provisions of section four thousand two hundred twenty-one of this chapter or any form of annuity contract that is subject to the provisions of section four thousand two hundred twenty-three of this chapter if such form of policy or contract provides for the adjustment of any cash surrender benefit or policy loan value in accordance with a market-value adjustment formula, unless there shall have been filed with the superintendent a memorandum, in form and substance satisfactory to the superintendent, describing the market-value adjustment formula and stating that, in the opinion of the insurer, the formula provides reasonable equity to terminating and continuing policy and contract holders and to the insurer and complies with the nonforfeiture provisions of this chapter. (11) (A) The superintendent shall not approve a life insurance policy which provides for accelerated payment of death benefits or special surrender values pursuant to subparagraph (B) or subparagraph (C) or subparagraph (D) of paragraph one of subsection (a) of section one thousand one hundred thirteen of this chapter unless it also provides for such accelerated payments or special surrender values pursuant to subparagraph (A) of paragraph one of subsection (a) of such section. (B) The superintendent shall promulgate a regulation establishing rules for advertising, disclosure, benefit levels, benefit eligibility, payment of long term care benefits, nonforfeiture, and reserves for accelerated payment of death benefits or special surrender values provided under a life insurance policy. The regulation shall establish reasonable disclosure requirements concerning the percentage of the death benefit payable when accelerated payment of the death benefit or special surrender value occurs, the impact of accelerated payment of the death benefit or special surrender value on eligibility for public assistance (as determined by the commissioner of social services), the prohibition that no health care facility as defined in section twenty of the public health law can require any person to accelerate payment of a death benefit or obtain a special surrender value as a condition of admission, providing or continuing care, and notice of possible tax obligations. (12) The superintendent shall promulgate a regulation relating to waiver of premium for unemployment as authorized by paragraph one of subsection (a) of section one thousand one hundred thirteen of this chapter establishing minimum standards for benefit levels, benefits eligibility and exclusions. The premium charged shall be reasonable in relation to the benefit provided. (d) The superintendent shall, within a reasonable time after the filing of any policy form requiring approval, notify the insurer filing the form of his approval or disapproval of it. S 3202. Withdrawal of approval of policy forms. The superintendent may, in accordance with section three thousand one hundred ten of this chapter, withdraw an approval previously given to a policy form pursuant to section three thousand two hundred one of this article. The superintendent may also withdraw an approval in the case of any such policy form (i) pertaining to accident and health insurance, if the benefits provided therein are unreasonable in relation to the premium charged, or if it contains provisions which encourage misrepresentation or are unjust, unfair, inequitable, misleading, deceptive, contrary to law or to the public policy of this state, or (ii) pertaining to life insurance, annuity contract, group annuity certificate, or funding agreement, if in his judgment the use of such form would be prejudicial to the interests of policyholders or members, or it contains provisions which are unjust, unfair or inequitable. S 3203. Individual life insurance policies; standard provisions as to contractual rights and responsibilities of policyholders and insurers. (a) All life insurance policies, except as otherwise stated herein, delivered or issued for delivery in this state, shall contain in substance the following provisions, or provisions which the superintendent deems to be more favorable to policyholders: (1) that, after payment of the first premium, the policyholder is entitled to a thirty-one day grace period or of one month following any subsequent premium due date within which to make payment of the premium then due. During such grace period, the policy shall continue in full force; (2) that if the death of the insured occurs within the grace period provided in the policy, the insurer may deduct from the policy proceeds the portion of any unpaid premium applicable to the period ending with the last day of the policy month in which such death occurred, and if the death of the insured occurs during a period for which the premium has been paid, the insurer shall add to the policy proceeds a refund of any premium actually paid for any period beyond the end of the policy month in which such death occurred, provided such premium was not waived under any policy provision for waiver of premiums benefit. This paragraph shall not apply to single premium or paid-up policies; (3) that the policy shall be incontestable after being in force during the life of the insured for a period of two years from its date of issue, and that, if a policy provides that the death benefit provided by the policy may be increased, or other policy provisions changed, upon the application of the policyholder and the production of evidence of insurability, the policy with respect to each such increase or change shall be incontestable after two years from the effective date of such increase or change, except in each case for nonpayment of premiums or violation of policy conditions relating to service in the armed forces. At the option of the insurer, provisions relating to benefits for total and permanent disability and additional benefits for accidental death may also be excepted; (4) that the policy, together with the application therefor if a copy of such application is attached to the policy when issued, shall constitute the entire contract between the parties; but in the case of policies that provide that the death benefit or other policy provisions may be changed by written application or by the written notice of exercise of one or more options provided in the policy, or automatically by the terms of the policy, the policy may also contain a provision that when such written application or notice of exercise of an option is accepted by the insurer or a notice of any change is issued by the insurer and, in each case, a copy of such application or notice is returned by mail or delivered to the policyholder at the policyholder`s last post office address known to the insurer, such application or notice shall become part of the entire contract between the parties; (5) that if the age of the insured has been misstated, any amount payable or benefit accruing under the policy shall be such as the premium would have purchased at the correct age; (6) that the insurer shall annually ascertain and apportion any divisible surplus accruing on the policy; (7) (A) that, in the case of policies which provide for the crediting of additional amounts pursuant to subsection (b) of section four thousand two hundred thirty-two of this chapter or under which cash surrender values are adjusted in accordance with a market-value adjustment formula or which cause on a basis guaranteed in the policy unscheduled changes in benefits or premiums or which provide an option for changes in benefits or premiums other than a change to a new policy, specifies the mortality table, interest rate and method used in calculating cash surrender values and any paid-up nonforfeiture benefits available under the policy; (B) that, in the case of all other policies, specifies the cash surrender values and other options available in the event of default in a premium payment after premiums have been paid for a specified period, together with a table showing, in figures, all options available during each of the policy`s first twenty years. Such options shall comply with the requirements of subsection (a) of section four thousand two hundred twenty or section four thousand two hundred twenty-one of this chapter; (8) (A) that the policyholder shall be entitled to a loan at any time the policy is in force in an amount not exceeding the loan value, and under the conditions, specified in section four thousand two hundred twenty-two of this chapter, provided three full years` premiums have been paid or, in the case of policies that provide that the policyholder may vary the amount and frequency of premiums to be paid to the insurer, after three years from the issue of the policy, if the policy is not in default; (B) that the sole security for the loan shall be assignment or pledge of the policy; (C) that, unless the policy provides for the crediting of additional amounts pursuant to subsection (b) of section four thousand two hundred thirty-two of this chapter or provides for the adjustment of the policy loan value in accordance with a market-value adjustment formula or causes on a basis guaranteed in the policy unscheduled changes in benefits or premiums or provides an option for changes in benefits or premiums other than a change to a new policy, the policy shall contain a table showing the loan values, if any, available during each of the policy`s first twenty years; (D) that, in making a loan, the insurer may reduce the loan value (in addition to the indebtedness deducted in determining such value) by any unpaid premium balance for the current policy year; (E) that, if the loan is made or repaid on a date other than the anniversary of the policy, the insurer may collect interest for the portion of the current policy year on a pro rata basis; (F) that, at the option of the insurer, the loan shall bear interest (i) at a maximum rate of not more than seven and four-tenths per centum per annum if payable in advance or the equivalent effective rate of interest if otherwise payable, or (ii) at a rate not in excess of an adjustable maximum rate established from time to time by the insurer as permitted by law. If the policy provides for an adjustable rate, the policy shall specify the regular intervals at which the interest rate is to be determined which shall be at least once every twelve months but not more frequently than once in any three month period; (G) the policy may further provide: (i) that if the interest on the loan is not paid when due, it shall be added to the existing loan, and shall bear interest at the applicable rate or rates payable on the loan determined in accordance with the provisions of the policy, and (ii) subject to subsection (e) of section three thousand two hundred six of this article that when the total indebtedness on the policy, including interest due or accrued, equals or exceeds the amount of the policy`s loan value and if at least thirty days` prior notice shall have been given in the manner provided in section three thousand two hundred eleven of this article, then the policy shall terminate and become void; (H) any policy which provides for the crediting of additional amounts pursuant to subsection (b) of section four thousand two hundred thirty-two of this chapter may also provide that if any indebtedness is owed to the insurer on any part of the loan value which would otherwise be credited with additional amounts, such additional amounts may be reduced so that the total amounts credited on such part are so credited at a rate that is up to two percent per annum less than the applicable loan interest rate charged or at such other rate as the superintendent, upon the insurer`s demonstrating justification therefor, may allow; (I) this paragraph eight shall not apply to term insurance; (J) this paragraph eight shall not apply to any policy qualified for special tax treatment under subsection (b) of section four hundred three of the Internal Revenue Code of 1986, as amended, to the extent such application would prevent such qualification; (9) a table showing the amounts of the applicable installment or annuity payments, if the policy proceeds are payable in installments or as an annuity; (10) that the policy shall be reinstated at any time within three years from the date of default, unless the cash surrender value has been exhausted or the period of extended insurance has expired, if the policyholder makes application, provides evidence of insurability, including good health, satisfactory to the insurer, pays all overdue premiums with interest at a rate not exceeding six per centum per annum compounded annually, and pays or reinstates any other policy indebtedness with interest at a rate not exceeding the applicable policy loan rate or rates determined in accordance with the policy`s provisions. This provision shall be required only if the policy provides for termination or lapse in the event of a default in making a regularly scheduled premium payment; (11) that upon surrender of the policy, together with a written request for cancellation, to the insurer during a period of not less than ten days nor more than thirty days from the date the policy was delivered to the policy owner, the insurer shall refund either (i) any premium paid for the policy, including any policy fees or other charges or (ii) if the policy provides for the adjustment of the cash surrender benefit in accordance with a market-value adjustment formula and if the policy or a notice attached to it so provides, the amount of the cash surrender benefit provided under the policy as so adjusted assuming no surrender charge plus the amount of all fees and other charges deducted from any premium paid or from the policy value; provided, however, that a policy sold by mail order must contain a provision permitting the policy owner a thirty day period for such surrender. A provision to this effect shall appear in the policy or in a notice attached to it; (12) in any policy under which additional amounts may be credited pursuant to subsection (b) of section four thousand two hundred thirty-two of this chapter, that states the guaranteed factors of mortality, expense and interest, and a statement of the method used by the insurer in calculating actual policy values; (13) in any policy under which additional amounts may be credited pursuant to subsection (b) of section four thousand two hundred thirty-two of this chapter, that such additional amounts shall be nonforfeitable after the effective date of their crediting except for any charges imposed under the policy which are not greater than those allowed under subsection (n-1) or any market value adjustment made pursuant to subsection (n-2) of section four thousand two hundred twenty-one of this chapter; and (14) in any policy under which additional amounts may be credited for any period pursuant to subsection (b) of section four thousand two hundred thirty-two of this chapter, that states that the insurer shall credit any such amount no less frequently than annually during such period. (15) that states on the policy data or policy specifications page of a participating cash value policy that dividends are not guaranteed and the insurer has the right to change the amount of dividend to be credited to the policy which may result in lower dividend cash values than were illustrated, or, if applicable, require more premiums to be paid than were illustrated. (16) that states on the policy data or policy specifications page of a life insurance policy subject to subsection (b) of section four thousand two hundred thirty-two of this chapter, to the extent applicable, that additional amounts are not guaranteed and the insurer has the right to change the amount of interest credited to the policy and the amount of cost of insurance or other expense charges deducted under the policy which may require more premium to be paid than was illustrated or the cash values may be less than those illustrated. (17) that states on the policy data or policy specification page the minimum guarantee interest rate used to determine the guaranteed policy values. (b) (1) A life insurance policy delivered or issued for delivery in this state may exclude or restrict liability in the event of death occurring while the insured is resident in a specified foreign country or countries, but shall not contain any provision excluding or restricting liability in the event of death caused in a certain specified manner, except as a result of: (A) conditions specified in subsection (c) hereof, subject to the terms of such subsection; (B) suicide within two years from the date of issue of the policy; (C) aviation under conditions specified in the policy; (D) hazardous occupations specified in the policy, provided death occurs within two years from the date of issue of the policy. (2) The superintendent may approve provisions that vary from subparagraphs (A) through (D) of paragraph one hereof and subsection (c) hereof, whenever he deems such substitute provisions to be substantially the same or more favorable to policyholders. (3) If a death occurs that is subject to an exclusion or restriction pursuant to this subsection or subsection (c) hereof, the insurer shall pay the reserve on the face amount of the policy, computed according to the mortality table and interest rate specified in the policy, together with the reserve for any paid-up additions thereto, and any dividends standing to the credit of the policy, less any indebtedness to the insurer on the policy, including interest due or accrued; provided that if the policy shall have been in force for not more than two years, the insurer shall pay the amount of the gross premiums charged on the policy less dividends paid in cash or used in the payment of premiums thereon and less any indebtedness to the insurer on the policy, including interest due or accrued. (c) (1) A life insurance policy delivered or issued for delivery in this state may contain provisions excluding or restricting liability in the event of death as a result of: (A) war or an act of war, if the cause of death occurs while the insured is serving in any armed forces or attached civilian unit and death occurs no later than six months after the termination of such service; (B) the special hazards incident to service in any armed forces or attached civilian unit, if the cause of death occurs during the period of such service while the insured is outside the home area, and if death occurs outside the home area or within six months after the insured`s return to the home area while in such service or within six months after the termination of such service, whichever is earlier; (C) war or an act of war, within two years from the date of issue of the policy, if the cause of death occurs while the insured is outside the home area but is not serving in any armed forces or attached civilian unit, and death occurs outside the home area or within six months after the insured`s return to the home area. (2) The superintendent may, by regulation, prescribe reasonable conditions relating to the use of provisions permitted by paragraph one hereof. The provisions of subsection (b) hereof shall apply to any policy containing any provision permitted by this subsection. (3) As used in this subsection, the term: (A) "armed forces" means the military, naval, or air forces of any country, international organization, or combination of countries; (B) "attached civilian unit" means a civilian non-combatant unit serving with any armed forces; (C) "home area" means the fifty states of the United States, the District of Columbia, and Canada; (D) "war" includes any war declared or undeclared, and armed aggression resisted by any armed forces; (E) "act of war" means any act peculiar to military, naval, or air operations in time of war; and (F) "special hazards incident to service", includes those hazards resulting in the insured`s death being presumed by reason of being missing, in action, or otherwise, or the insured`s death from disease or injury, accidental or otherwise, to which a person serving in, or with, any armed forces or attached civilian units is exposed in the line of duty. (4) In permitting war exclusions, it is the legislative intent that such exclusions are not to be construed or interpreted as exclusions because of the status of the insured as a member of any armed forces or attached civilian units, or because of the presence of the insured as a civilian in a combat area or area adjacent thereto. Such permissible exclusions shall be construed and interpreted according to the fair import of their terms so as not to exclude deaths due to diseases or accidents which are common to the civilian population and are not attributable to special hazards to which a person serving in such forces or units is exposed in the line of duty. (5) Any such war exclusion shall terminate six months after the end of the war in which the insured was engaged or the war which the insured was likely to engage in at the time of application for this policy, after the discharge, release or separation of the insured from active military service, after the demobilization of the insured, or after the insured permanently leaves the war area, whichever occurs first. The end of war shall be determined by an order of the president of the United States or by federal law or shall be deemed to occur on the effective date of an agreement or declaration to end all hostilities which has been adopted or accepted by all armed forces involved therein, or in the absence of such an agreement or declaration at the end of ninety continuous days from the end of all hostilities. (d) (1) Subsections (b) and (c) hereof shall not apply to any provision in a life insurance policy for additional benefits in the event of accidental death. (2) If a policy provides that the death benefit may be increased or other policy provisions changed upon the application of the policyholder and the production of evidence of insurability, the policy may also provide that the two-year exclusions permitted under subparagraph (B) or (D) of paragraph one of subsection (b) hereof or subparagraph (C) of paragraph one of subsection (c) hereof shall run from the date of issue of the policy except that it shall run from the effective date of each subsequent increase or change with respect to each such increase or change. (e) Any of the provisions of this section, or portions thereof, exclusive of paragraph eleven of subsection (a) of this section, that do not apply to a single premium, nonparticipating, or term policy, shall to that extent not be incorporated in such policy. This section shall not apply to group life insurance. S 3204. Policy to contain entire contract; statements of applicant to be representations and not warranties; alterations. (a) (1) Every policy of life, accident or health insurance, or contract of annuity, delivered or issued for delivery in this state, shall contain the entire contract between the parties, and nothing shall be incorporated therein by reference to any writing, unless a copy thereof is endorsed upon or attached to the policy or contract when issued. (2) No application for the issuance of any such policy or contract shall be admissible in evidence unless a true copy was attached to such policy or contract when issued. (3) Such policy or contract cannot be modified, nor can any rights or requirements be waived, except in a writing signed by a person specified by the insurer in such policy or contract. (b) Subsection (a) hereof shall not apply to a table or schedule of rates, premiums or other payments which is on file with the superintendent for use in connection with such policy or contract. (c) All statements made by, or by the authority of, the applicant for the issuance, reinstatement or renewal of any such policy or contract shall be deemed representations and not warranties. (d) No insertion in or other alteration of any written application for any such policy or contract shall be made by any person other than the applicant without his written consent, except that insertions may be made by the insurer for administrative purposes only in such manner as to indicate clearly that the insertions are not to be ascribed to the applicant. (e) If any policy of life, accident and health insurance delivered or issued for delivery in this state is reinstated or renewed, or if any such policy of life insurance provides that a change in the death benefit or other policy provisions may be made on application or by the written notice of exercise of one or more options provided in the policy, and the insured or the beneficiary or assignee of such policy makes written request to the insurer for a copy of the application, if any, for such reinstatement or renewal or change in the death benefit or other policy provisions or of the written notice of exercise of such an option, the insurer shall, within fifteen days after the receipt of such request at its home office or any branch office of the insurer, deliver or mail to the person making such request, a copy of such application or notice. If such copy is not delivered or mailed, the insurer shall be precluded from introducing such application or notice as evidence in any action or proceeding based upon or involving such policy or its reinstatement, renewal or change. (f) Any waiver of the provisions of this section shall be void. S 3205. Insurable interest in the person; consent required; exceptions. (a) In this section: (1) The term, "insurable interest" means: (A) in the case of persons closely related by blood or by law, a substantial interest engendered by love and affection; (B) in the case of other persons, a lawful and substantial economic interest in the continued life, health or bodily safety of the person insured, as distinguished from an interest which would arise only by, or would be enhanced in value by, the death, disablement or injury of the insured. (2) The term "contract of insurance upon the person" includes any policy of life insurance and any policy of accident and health insurance. (3) The term "person insured" means the natural person, or persons, whose life, health or bodily safety is insured. (b) (1) Any person of lawful age may on his own initiative procure or effect a contract of insurance upon his own person for the benefit of any person, firm, association or corporation. Nothing herein shall be deemed to prohibit the immediate transfer or assignment of a contract so procured or effectuated. (2) No person shall procure or cause to be procured, directly or by assignment or otherwise any contract of insurance upon the person of another unless the benefits under such contract are payable to the person insured or his personal representatives, or to a person having, at the time when such contract is made, an insurable interest in the person insured. (3) Notwithstanding the provisions of paragraphs one and two of this subsection, a Type B charitable, educational or religious corporation formed pursuant to paragraph (b) of section two hundred one of the not-for-profit corporation law, or its agent, may procure or cause to be procured, directly or by assignment or otherwise, a contract of life insurance upon the person of another and may designate itself or cause to have itself designated as the beneficiary of such contract. (4) If the beneficiary, assignee or other payee under any contract made in violation of this subsection receives from the insurer any benefits thereunder accruing upon the death, disablement or injury of the person insured, the person insured or his executor or administrator may maintain an action to recover such benefits from the person receiving them. (c) No contract of insurance upon the person, except a policy of group life insurance, group or blanket accident and health insurance, or family insurance, as defined in this chapter, shall be made or effectuated unless at or before the making of such contract the person insured, being of lawful age or competent to contract therefor, applies for or consents in writing to the making of the contract, except in the following cases: (1) A wife or a husband may effectuate insurance upon the person of the other. (2) Any person having an insurable interest in the life of a minor under the age of fourteen years and six months or any person upon whom such minor is dependent for support and maintenance, may effectuate a contract of insurance upon the life of such minor, in an amount which shall not exceed the limits specified in section three thousand two hundred seven of this article. (d) In addition to any other basis under which either an employer, or an irrevocable trust established by one or more employers or one or more employers and one or more labor unions, have an insurable interest in the lives of any of its employees or retirees or those of its subsidiaries or affiliated companies, an employer or such a trust shall have an insurable interest in the lives of any such employees or retirees who are participants or who are eligible to participate, upon the satisfaction of age, service or similar eligibility criteria, in an employee benefit plan, established or maintained by an employer as defined by the federal Employee Retirement Income Security Act of 1974, 29 U.S.C. S 1001 et seq., provided that: (1) The employer providing for insurance coverage or causing such coverage to be issued under this subsection: (A) prior to or at the commencement of any such coverage notifies prospective insureds in writing that coverage is being obtained on their lives, requires that prospective insureds consent in writing to such coverage, provides each consenting insured the right to have any coverage on his/her life issued under the authority of this subsection discontinued at any time and describes in the notice the method the insured may use to terminate coverage; (B) at the time any insured employee`s employment terminates, notifies the employee of the right to discontinue such coverage, provided, however, that no such notification shall be required if the insured employee possesses a present or prospective right to receive any of the benefits under an employee benefit plan being financed, in whole or in part, by such life insurance coverage; and (C) at any time after the termination of an insured employee`s employment and upon the termination of an employee benefit plan being financed, in whole or in part, by such life insurance coverage or a reduction of the benefits provided thereunder, notifies the employee of the right to discontinue such coverage. (2) At the time coverage is issued, the total amount of insurance coverage issued to date to the employer or trust under authority of this subsection shall not exceed the costs of employee and/or retiree benefits already incurred in connection with such employee benefit plan since the earliest date coverage on an employee or retiree was issued under this subsection, plus the projected future cost of such benefits as established by the employer. (3) The amount of coverage insuring the life of each such employee or retiree and the selection of the employees or retirees to be insured is based purely on nondiscriminatory factors such as age, premium amount or some other nondiscriminatory factor, and not on conditions or terms of employment other than participation in an employee benefit plan described herein. (4) If subsequent to issuance of the policy or policies providing life insurance coverage pursuant to this subsection, the insurer providing the coverage is replaced by another insurer, the employer shall notify each insured employee or retiree of such replacement. (5) During the first five years subsequent to issuance of the policy or policies providing life insurance pursuant to this subsection, the policyholder does not undertake a pattern of borrowing likely to require all or a substantial part of the cash values of the policies to be pledged as security against repayment of such loans, unless such borrowing was incurred because of an unforeseen substantial loss of income or unforeseen increase in financial obligations. (e) If, pursuant to subparagraph (A) of paragraph one of subsection (d) of this section, the employer receives from the employee or retiree written notice that he or she rejects the issuance of the insurance, the employer shall notify the insurer of such rejection and the insurance shall not be issued, or if the insurance has already been issued and the employee elects to have the existing coverage terminated, the employee shall notify the insurer of the election to terminate coverage in writing, and upon receipt of such written notice from the employee, the insurance shall not be continued in effect and shall terminate upon receipt of such written notice from the employee. In such event, the insurer shall pay any amounts which are payable to the employer or trust policy owner as the result of such termination of coverage, pursuant to the terms and conditions of coverage. Unless the employee or retiree complies with the requirements of this subsection, neither the employee, retiree nor his or her successor in interest, may contest the validity of the coverage. S 3206. Policies which provide for an adjustable maximum rate of interest on policy loans. (a) In this section: (1) The term "policy" includes: (i) life insurance policies subject to the provisions of item (ii) of subparagraph (F) of paragraph eight of subsection (a) of section three thousand two hundred three of this article, and (ii) annuity contracts subject to the provisions of subsection (c) of section three thousand two hundred nineteen of this article, and (iii) certificates issued by a fraternal benefit society subject to the provisions of paragraph six of subsection (a) of section four thousand five hundred ten of this chapter, and (iv) annuity certificates subject to section four thousand five hundred thirteen of this chapter, when such policies, contracts, or certificates provide for loans with adjustable rates of interest. (2) The term "policy loan" includes any cash loans and any premium loans made under a policy to pay one or more premiums that were not paid to the life insurer as they fell due. (3) The term "policyholder" includes the owner of the policy or the person designated to pay premiums as shown on the records of the insurer. (4) The term "published monthly average" means: (A) the Monthly Average Corporates yield shown in Moody`s Corporate Bond Yield Averages published by Moody`s Investors Service Inc., or any successor thereto; or (B) in the event that the Moody`s Corporate Bond Yield Averages -- Monthly Average Corporates is no longer published, a substantially similar average, established by regulation issued by the superintendent. (b) The adjustable maximum rate of interest on policy loans for each policy will be determined at the regular intervals specified in the policy. At the intervals specified in the policy: (1) the rate being charged may be increased whenever such increase as determined under subsection (c) hereof would increase that rate by one-half per centum or more per annum; and (2) the rate being charged must be reduced whenever such reduction as determined under subsection (c) hereof would decrease that rate by one-half per centum or more per annum. (c) The rate of interest charged on a policy loan made under such a policy shall not exceed the higher of the following: (1) the published monthly average for the calendar month ending two months before the date on which the rate is determined; or (2) the rate used to compute the cash surrender values under the policy during the applicable period plus one per centum per annum. (d) The insurer shall for any such policy: (1) notify the policyholder at the time a cash loan is made of the initial rate of interest on the loan; (2) notify the policyholder with respect to premium loans of the initial rate of interest on the loan as soon as it is reasonably practical to do so after making the initial loan. Notice need not be given to the policyholder when a further premium loan is added, except as provided in paragraph three hereof; (3) send to policyholders with loans reasonable advance notice of any increase in the rate; and (4) include in the notices required above the substance of the pertinent policy provisions permitting an adjustable maximum interest rate on policy loans established from time to time by the insurer as permitted by law, and specifying the frequency at which the interest rate is to be determined by the insurer as permitted by law. (e) No policy shall terminate in a policy year as the sole result of change in the interest rate during that policy year, and the insurer shall maintain coverage during that policy year until the time at which it would otherwise have terminated if there had been no change during that policy year. (f) Participating policies issued under the provisions of this section shall constitute one or more dividend classifications, as established by the board of directors of the insurer, separate from dividend classifications established for other participating policies issued by the insurer. (g) No provision of law regulating the maximum rate of interest which may be charged, taken or received, other than section 190.40 or section 190.42 of the penal law shall apply to any loan made pursuant to the provisions of this section. (h) The provisions of this section shall not be made to apply to any policy issued before January first, nineteen hundred eighty-three unless the policyholder agrees in writing to the applicability of such provisions. Any holder of a policy issued before January first, nineteen hundred eighty-three which is of a classification determined by the insurer as eligible may request the insurer to make the provisions of this section applicable to such policy; the superintendent may require justification of the eligibility standard determined by the insurer. S 3207. Life insurance contracts by or for the benefit of minors; on the lives of minors, limitations on amount. (a) A minor above the age of fourteen years and six months shall be deemed competent to enter into a contract for, be the owner of, and exercise all rights relating to, a policy of life insurance upon the life of the minor or upon the life of any person in whom the minor has an insurable interest, but the beneficiary of such policy may be only the minor or the parent, spouse, brother, sister, child or grandparent of the minor. (b) (1) No insurer shall knowingly deliver or issue for delivery in this state any policy or policies of life insurance upon the life of a minor under the age of fourteen years and six months for an amount or amounts of life insurance which, together with the amount of life insurance under any other policy or policies then in force upon the life of such minor, is, except as provided in subsections (c) and (d) hereof, in excess of the following limits which are applicable at the ages specified below: (A) Under two years and six months, one thousand dollars. (B) Two years and six months or more of age and under nine years and six months, two thousand dollars. (C) Nine years and six months or more of age and under eleven years and six months, three thousand dollars. (D) Eleven years and six months or more of age and under fourteen years and six months, five thousand dollars. (2) The amount of life insurance under a policy issued in accordance with this subsection or subsection (c) hereof may be made to increase as provided in such policy with advancing age of the insured provided the increased amount, together with the amount of insurance in force upon the life of such minor under any policies issued prior to such policy, shall not at any time before such minor attains the age of fourteen years and six months be in excess of the limits applicable at the attained age of such minor in accordance with this subsection and subsection (c) hereof. (c) An insurer may deliver or issue for delivery in this state a policy or policies of life insurance upon the life of a minor under the age of fourteen years and six months, for an amount or amounts of life insurance which may be in excess of the limits specified in subsection (b) of this section, provided that such policy or policies are effectuated by a person or persons having an insurable interest in the life of such minor or by a person or persons upon whom such minor is dependent for support and maintenance and provided further that an insurer shall not knowingly issue such a policy or policies for an amount which, together with the amount of life insurance under any other policy or policies then in force upon the life of such minor, is in excess of the limit of ten thousand dollars or the limit of fifty per centum (five thousand dollars or the limit of twenty-five per centum in the case of a minor under the age of four years and six months) of the amount of life insurance in force upon the life of the person effectuating the insurance at the date of issue of the policy on the life of such minor, whichever limit is the greater, and any amount of life insurance on the life of such minor not in excess of such limit when issued shall not be deemed to be in excess thereof by reason of any reduction thereafter in the amount of life insurance in force upon the life of the person effectuating the insurance. (d) An insurer may deliver or issue for delivery in this state a policy or policies of life insurance upon the life of a minor under the age of fourteen years and six months for an amount or amounts of life insurance which may be in excess of the limits specified in subsections (b) and (c) of this section if the policy or policies are effectuated and the premiums paid by a person or persons having an insurable interest in the life of the minor and if the minor is not dependent upon such person or persons for support and maintenance. (e) (1) If an insurer shall deliver or issue for delivery in this state any policy of life insurance on the life of a minor for an amount in excess of the limits prescribed by subsection (b) or (c) of this section, whichever is applicable, the amount under such policy which is in excess shall not be valid, or payable as a claim by death, so long as and to the extent that it continues to be in excess, provided that no such insurance shall be deemed to be in excess on or after the date upon which the minor attains the age of fourteen years and six months. (2) The insurer which issues such excess amount, determined by priority of date of issue of policies if there is more than one policy, shall upon demand therefor or upon the death of the insured and upon proof satisfactory to the insurer that such excess exists at the time of such demand or death refund with interest, at the rate assumed in the valuation of the policy, the premiums paid less dividends allowed, on the amount of insurance that is in excess at the date of such demand or death, and such excess insurance and all of the obligations of the insurer thereunder shall terminate. Any indebtedness to the insurer on any excess insurance shall be deducted by the insurer from such refund. (3) If only a part of the amount of insurance under such a policy is in excess of such limits, the refund shall bear the same proportion to the total premiums paid less dividends allowed under such policy as the amount of such excess insurance bears to the amount of insurance in force under the policy at the date of such refund, and the amount or amounts thereafter payable under such policy shall be reduced in the same proportion. (4) If an insurer shall have made payment as a death claim of an amount in excess of such limits without having had proof satisfactory to it that such insurance was in excess, such insurer shall not be liable for the refund specified above. (f) Notwithstanding the foregoing limitations, any domestic life insurance company may issue for delivery in another state or foreign country any policy which is governed by the laws of such state or country for any amount not prohibited by the laws of such other state or country. (g) The amount of life insurance within the meaning of this section shall not be deemed to include return premium benefits or the return of cash value or any additional benefits payable in the event of death by accident, any variable death benefit above the guaranteed minimum death benefit provided under a variable life insurance policy, or any additional insurance provided by the application of dividends or by the application of additional amounts credited to a policy pursuant to subsection (b) of section four thousand two hundred thirty-two of this chapter. S 3208. Antedating of life insurance policies and burial agreements prohibited. (a) No insurer shall knowingly deliver or issue for delivery in this state any policy of life insurance that purports to have been issued or to have taken effect more than six months before the date on which the application therefor was made, if thereby the premium is reduced below the premium that would be payable thereon as determined by the insured`s birthday nearest the date on which the application was made. (b) No agent, other representative of an insurer or broker shall prepare, submit or accept in this state any application for life insurance dated earlier than the date on which the application was made by the insured or the applicant, if thereby the premium is reduced as above stated. (c) This section shall not be construed to invalidate any contract made in violation of the provisions hereof; nor to prohibit the exchange, alteration or conversion of any policy of life insurance as of the original date thereof if the amount of insurance of the new policy does not exceed the greater of that of the original policy or that which the premium paid for the original policy would have purchased if the new policy had been originally applied for; nor to prohibit the exercise of any conversion privilege contained in any policy. (d) No person, firm, association, society, or corporation engaged in this state in the business of providing for the payment of funeral, burial or other expenses of deceased members, whether or not it be subject to the other provisions of this chapter, and no insurer shall: (1) deliver or issue for delivery in this state any contract or policy whereby the benefit or any part thereof accruing under such contract or policy, upon the death of such member or of the person insured, shall be payable to a designated or restricted funeral director or funeral directing concern or other person engaged in such trade or business, or to any official or designated group of them; or * (2) pay any such benefit or any part thereof to any funeral director or funeral directing concern or other person engaged in such trade or business or to any official or designated group of them, without the consent of the person or persons entitled to such benefits, or to pay any commission or other consideration to any funeral director or funeral directing concern or employee thereof to induce such person to sell or offer to sell any contract or policy of insurance designated or marketed as payable for funeral or burial expenses upon the death of the insured; or * NB Effective until June 1, 2003 * (2) pay any such benefit or any part thereof to any funeral director or funeral directing concern or other person engaged in such trade or business or to any official or designated group of them, without the consent of the person or persons entitled to such benefits; or * NB Effective June 1, 2003 * (3) in any way deprive the personal representative or family of the deceased of the advantages of competition in procuring and purchasing supplies and services in connection with the funeral and burial arrangements of such deceased. * NB Effective until June 1, 2003 * (3) in any way deprive the personal representative or family of the deceased of the advantages of competition in procuring and purchasing supplies and services in connection with the burial of such deceased. * NB Effective June 1, 2003 S 3209. Life insurance, annuities and funding agreements disclosure requirements. (a) Except as hereafter exempted, this section shall apply to any solicitation, negotiation or procurement of life insurance, annuities or funding agreements occurring within this state. This section shall apply to any issuer of life insurance or annuity contracts or funding agreements, including fraternal benefit societies and the life insurance department of a savings and insurance bank. Unless otherwise specifically included, this section shall not apply to: credit life insurance; group life insurance; life insurance policies, annuity contracts, and funding agreements issued in connection with pension and welfare plans as defined by and to the extent covered by the federal Employee Retirement Income Security Act of 1974 (ERISA); funding agreements issued to other than individuals pursuant to subsection (b) of section three thousand two hundred twenty-two of this article; and any group annuity unless at least one certificate is subject to paragraph two of subsection (b) of section four thousand two hundred twenty-three of this chapter. (b) No policy of life insurance shall be delivered or issued for delivery in this state after the applicable effective date, as set forth in subsection (n) of this section, unless the prospective purchaser has been provided with the following: (1) a copy of the most recent buyer`s guide and the preliminary information required by subsection (d) of this section, at or prior to the time an application is taken. When sales solicitations are made by mail, without the involvement of an agent or broker, each initial solicitation must include a copy of the buyer`s guide unless the policy for which application is made provides for a period of at least thirty days within which the applicant may return the policy for an unconditional refund of the premiums paid, in which event the buyer`s guide must be delivered with the policy or prior to delivery of the policy; in addition, such solicitation must alert the prospective purchaser of the right to receive, upon request, a buyer`s guide and a policy summary prior to delivery of the policy; and (2) a policy summary upon delivery of the policy. (c) Every insurer must provide, to any policyholder who so requests, a policy summary for each in-force premium-paying policy for which no policy summary has ever been furnished. The insurer may charge the policyholder a reasonable fee for preparation of this summary, subject to guidelines specified in rules promulgated by the superintendent. (d) The preliminary information shall be in writing and include, to the extent applicable, the following: (1) the name and address of the insurance agent or broker or, if no agent or broker is involved, a statement of the procedure to be followed in order to receive responses to inquiries concerning the preliminary information; (2) the full name and home office, administrative office or branch or agency office address of the company in whose name the life insurance policy is to be written; (3) the date of the preliminary information and the generic name, the initial amount of insurance and the initial annual premium for the basic policy; (4) the total guaranteed cash surrender values for the basic policy, at the end of the tenth and twentieth policy years or at the end of the premium-paying period if earlier. These values may be shown on a per thousand or per unit basis; (5) the effective policy loan annual percentage interest rate, if the policy would contain this provision, and whether this rate is applied in advance or in arrears, adjustable or fixed; (6) for the life insurance policies described in paragraph one of subsection (n) of this section, life insurance cost indexes and the equivalent level annual dividend for the basic policy for ten and twenty years, but in no case beyond the premium-paying period; (7) in addition, the applicant shall be advised that, when the policy is issued, a complete policy summary, including cost data, based on the benefits, premiums and dividends of the policy as issued, will be furnished; and that, following the receipt of the policy and policy summary, there will be a period of not less than ten days within which the applicant may return the policy for an unconditional refund of the premiums paid; and (8) notwithstanding the foregoing, no applicant for life insurance shall be prevented or delayed in effecting or applying for coverage by the requirements of this section. In such cases where prior to application it is impractical to provide any items prescribed by this section, such items may be estimated in good faith or furnished as soon thereafter as practical prior to delivery of policy. (e) A policy summary shall include the following: (1) a prominently placed title as follows: "STATEMENT OF POLICY COST AND BENEFIT INFORMATION"; (2) the name and address of the insurance agent or broker, or, if no agent or broker is involved, a statement of the procedure to be followed in order to receive responses to inquiries regarding the policy summary; (3) the full name and home office, administrative office or branch or agency office address of the company in whose name the life insurance policy is to be or has been written; (4) the generic name of the basic policy and each rider; (5) for the life insurance policies described in paragraph one of subsection (n) of this section, the following amounts, where applicable, for the first five policy years and representative policy years thereafter sufficient to clearly illustrate the premium and benefit patterns, including the years for which life insurance cost indexes are displayed and at least one age from sixty through sixty-five or maturity, whichever is earlier: (A) the annual premium for the basic policy; (B) the annual premium for each optional rider; (C) guaranteed amount payable upon death at the beginning of the policy year regardless of the cause of death, other than suicide or other specifically enumerated exclusions, which is provided by the basic policy and each optional rider, with benefits provided under the basic policy and each rider shown separately; (D) total guaranteed cash surrender values at the end of the year with values shown separately for the basic policy and each rider; (E) cash dividends payable at the end of the year with values shown separately for the basic policy and each rider. Dividends need not be displayed beyond the twentieth policy year; and (F) guaranteed endowment amounts payable under the policy which are not included in guaranteed cash surrender values above; (6) the effective policy loan annual percentage interest rate if the policy contains this provision, specifying whether this rate is applied in advance or in arrears. If the policy provides for an adjustable loan interest rate, the policy summary shall so state, shall set forth the frequency at which the rate is to be determined for that policy, and shall describe the index upon which the maximum rate is based at the time the policy is issued; (7) for the life insurance policies described in paragraph one of subsection (n) of this section: (A) life insurance cost indexes for ten and twenty years but in no case beyond the premium-paying period. Separate indexes are to be displayed for the basic policy and for each optional term life insurance rider. Such indexes need not be included for optional riders which are limited to benefits such as accidental death benefits, disability waiver of premium, preliminary term life insurance coverage of less than twelve months and guaranteed insurability benefits, nor for basic policies or optional riders covering more than one life; (B) the equivalent level annual dividend, in the case of participating policies and participating optional term life insurance riders, under the same circumstances and for the same durations at which life insurance cost indexes are displayed; (8) a policy summary which includes dividends shall also include a statement that dividends are based on the company`s current dividend scale and are not guaranteed; in addition, the summary shall, for the life insurance policies described in paragraph one of subsection (n) of this section, include a statement in close proximity to the equivalent level annual dividend as follows: "An explanation of the intended use of the equivalent level annual dividend is included in the buyer`s guide"; (9) a statement in close proximity to the life insurance cost indexes as follows: "AN EXPLANATION OF THE INTENDED USE OF THESE INDEXES IS PROVIDED IN THE BUYER`S GUIDE"; and (10) the date on which the policy summary is prepared. (f) The policy summary must be a separate document. All information required to be disclosed must be set out in such a manner as not to minimize or render any portion thereof obscure. Any amounts which remain level for two or more years of the policy may be represented by a single number if it is clearly indicated what amounts are applicable for each policy year. Amounts in paragraph five of subsection (e) of this section shall be listed in total, not on a per thousand or per unit basis. If more than one insured is covered under one policy or rider, guaranteed death benefits shall be displayed separately for each insured or for each class of insureds if death benefits do not differ within the class. Zero amounts shall be displayed as zero and shall not be displayed as a blank space. (g) Every insurer shall maintain, at its home office or principal office, a complete file containing one copy of each policy summary form authorized by the insurer for use pursuant to this section. (h) An agent or broker shall inform a prospective purchaser, prior to commencing a life insurance sales presentation, that he is acting as a life insurance agent or broker, and inform the prospective purchaser of the full name of the insurer which he is representing. In sale situations in which an agent or broker is not involved, the insurer shall identify its full name. (i) As used in this section, "buyer`s guide" means a separate document published and disseminated by insurers. The language therein shall be promulgated by the superintendent, and shall, to the extent practicable and in the public interest as determined by the superintendent, be consistent with the latest version of a buyer`s guide as adopted by the national association of insurance commissioners. (j) For life insurance policies, except term life insurance policies, which are to be issued to qualify for special tax treatment under subsection (b) of section four hundred three of the Internal Revenue Code of 1986, as amended, a written notice shall be delivered to the proposed insured in a manner satisfactory to the superintendent at or prior to the time an application is taken and shall read as follows: "The purchase of a life insurance policy with cash value, which qualifies for special tax treatment under section 403(b) of the Internal Revenue Code of 1986, as amended, may not be appropriate for individuals seeking to maximize the accumulation of funds for retirement or for individuals seeking life insurance coverage primarily to provide a survivorship benefit for the spouse in the event of death prior to retirement. If an individual needs coverage to continue after retirement, current tax laws require the commencement of taxable distributions under the tax sheltered annuity plan (TSA) no later than age seventy and one-half which may necessitate some adjustment in the cash value life insurance policy or may result in increased insurance costs in future policy years. You should consult with your tax advisor before purchasing life insurance with cash value as part of a tax sheltered annuity (TSA)." (k) The superintendent shall promulgate by regulation the contents and allowable format of the preliminary information and the information to appear in the policy summary. The superintendent shall also promulgate by regulation standards governing the content, format and use of illustrations of individual life insurance policies and certain group life insurance policies and certificates, life insurance policies subject to section four thousand two hundred thirty-two of this chapter, variable life insurance policies under which the death benefits and cash values vary in accordance with the unit values of investments held in a separate account and individual annuities, individual funding agreements, variable annuities, and group annuity contracts if any certificate is issued to which paragraph two of subsection (b) of section four thousand two hundred twenty-three of this chapter applies. The illustration regulation shall be consistent, to the greatest extent practicable and in the public interest as determined by the superintendent, with the illustration regulations as adopted by the national association of insurance commissioners. The superintendent in developing regulations to govern the content and format of the preliminary information, policy summary and illustrations shall ensure that such forms are presented in an easy, concise and meaningful way to enable consumers to understand the operation of the policy or contract. (1) An insurer of any life insurance policy or annuity contract subject to this section shall notify the superintendent whether its policies or contract forms have been or will be marketed with or without an illustration. For those policies and contracts marketed with an illustration which complies with the regulations promulgated pursuant to subsection (k) of this section, no preliminary information or policy summary shall be required. For those policies which are not marketed with an illustration, the preliminary information and policy summary shall be provided pursuant to the provisions of this section. (m) The superintendent, by regulation, shall determine the applicability of the illustration regulation promulgated pursuant to subsection (k) of this section to group life insurance policies and group annuities and funding agreements. Such determination shall be consistent, to the greatest extent practicable and in the public interest, with the illustration regulations as adopted by the national association of insurance commissioners. (n) The effective dates of this section as applied to policies of life insurance, annuity contracts, and funding agreements shall be as follows: (1) for individual life insurance policies, certain group life insurance policies and certificates and life insurance policies subject to section four thousand two hundred thirty-two of this chapter, January first, nineteen hundred ninety-eight; (2) for annuities and funding agreements, the date of promulgation of regulations by the superintendent pursuant to subsection (k) of this section but not later than June thirty, nineteen hundred ninety-eight; (3) for variable life insurance policies and variable annuities, the date of promulgation of regulations by the superintendent but not later than January first, nineteen hundred ninety-nine. No less than three months prior to promulgating the regulations required to implement subsection (k) of this section pursuant to paragraphs two and three of this subsection, the superintendent shall hold public hearings on such regulations. S 3210. Incontestability after reinstatement. Any policy of life or non-cancellable disability insurance or contract of annuity delivered or issued for delivery in this state that is reinstated shall be incontestable after the same period following reinstatement and with the conditions and exceptions provided in the policy or contract with respect to incontestability. S 3211. Notice of premium due under life or disability insurance policy; notice to assignees of non-payment of premium. (a) (1) No policy of life insurance or non-cancellable disability insurance delivered or issued for delivery in this state, and no life insurance certificate delivered or issued for delivery in this state by a fraternal benefit society, shall terminate or lapse by reason of default in payment of any premium, installment, or interest on any policy loan in less than one year after such default, unless a notice shall have been duly mailed at least fifteen and not more than forty-five days prior to the day when such payment becomes due. A separate notice shall not be required for insurance that is supplemental to a policy of life insurance. (2) If a life insurance policy or life insurance certificate provides that the policyholder or certificate holder may vary the amount and frequency of premiums to be paid to the insurer, premiums, installments and interest on loans will be considered due on the day when the failure of the insurer or fraternal benefit society to receive an amount of premium, installment or interest on loan would cause such policy or certificate to terminate or lapse, and the failure to pay such amount shall be considered a default. (b) The notice required by paragraph one of subsection (a) hereof shall: (1) be duly mailed to the last known address of the person insured, or if any other person shall have been designated in writing to receive such notice, then to such other person; (2) state the amount of such payment, the date when due, the place where and the person to whom it is payable; and shall also state that unless such payment is made on or before the date when due or within the specified grace period thereafter, the policy shall terminate or lapse except as to the right to any cash surrender value or nonforfeiture benefit. (c) If the payment demanded by such notice shall be made within the time limited therefor, it shall be taken to be in full compliance with the requirements of the policy in respect to the time of such payment. The statement of any officer, employee or agent of such insurer, or of any one authorized to mail such notice, subscribed and affirmed by him as true under the penalties of perjury, stating facts which show that the notice required by this section has been duly addressed and mailed shall be presumptive evidence that such notice has been duly given. (d) No action shall be maintained to recover on any life insurance policy, or on any such non-cancellable contract of permanent and total disability insurance, which has lapsed because of default in making such payment (except an action to recover the cash surrender value or nonforfeiture benefit) unless the action is instituted within two years from the date of such default. (e) (1) An assignee of a policy of life insurance under an assignment made in this state may request the insurer to give such assignee notice of non-payment of any premium due on such policy. (2) The request must be made before default in payment of premium, and must be in writing, mailed to the home office of the insurer and specify the name and address of the assignee, the name of the insured and the policy number. (3) When the request is made as provided herein the right of such assignee to the cash surrender value or other nonforfeiture benefit under the policy shall continue as it existed on the date of default until the expiration of ten days after the mailing of notice of such default to the last known address of the assignee. (4) Upon termination of the assignee`s rights under the assignment, the assignee shall promptly mail a release thereof to the insurer. (5) This subsection shall not be construed to affect the contractual rights of assignees. (f) This section shall not apply to: (1) Any policy of group insurance. (2) Any policy of insurance requiring the payment of premiums monthly or at shorter intervals, provided in the case of policies of life insurance the insurer issuing such policy elects with respect to all such policies to mail a written notice within six months after termination or lapse to the insured or to any other person who shall have been designated in writing to receive such notice, stating the type and amount of any automatic nonforfeiture benefit in force. (g) In the case of life insurance policies to which this section is applicable and which contain a cash surrender value, the insurer must provide an annual notification that the policy contains a cash surrender value and that further information, including the amount thereof, is available from the insurer upon written request from the policyowner. Such notification shall include a statement that the insured has the right to request an updated policy illustration based, in respect to a participating policy, on the then current dividend scale, and in respect to a policy subject to subsection (a) of section four thousand two hundred thirty-two of this chapter, on the then current mortality, interest and expense assumptions. The notification pertaining to the cash surrender value shall be set out in a conspicuous manner and shall include the address to which the policyowner may make a written inquiry. Any notice or statement which informs a policyowner of the policy`s cash surrender value at least annually shall be deemed to comply with the requirements of this subsection. (h) In the case of life insurance policies described in paragraph two of subsection (f) of this section and which contain a cash surrender value, the notification requirement of subsection (g) of this section will apply in cases where the insurer voluntarily sends a notice of the premium due. S 3212. Exemption of proceeds and avails of certain insurance and annuity contracts. (a) In this section: (1) The term "proceeds and avails", in reference to policies of life insurance, includes death benefits, accelerated payments of the death benefit or accelerated payment of a special surrender value, cash surrender and loan values, premiums waived, and dividends, whether used in reduction of premiums or in whatever manner used or applied, except where the debtor has, after issuance of the policy, elected to receive the dividends in cash. (2) An annuity contract includes any obligation to pay certain sums at stated times, during life or lives, or for a specified term or terms, issued for a valuable consideration, regardless of whether such sums are payable to one or more persons, jointly or otherwise, but does not include payments under a life insurance policy at stated times during life or lives, or for a specified term or terms. (3) The term "creditor" includes every claimant under a legal obligation contracted or incurred after December thirty-first, nineteen hundred thirty-nine. (4) The term "execution" includes execution by garnishee process and every action, proceeding or process whereby assets of a debtor may be subjected to the claims of creditors. (b) (1) If a policy of insurance has been or shall be effected by any person on his own life in favor of a third person beneficiary, or made payable otherwise to a third person, such third person shall be entitled to the proceeds and avails of such policy as against the creditors, personal representatives, trustees in bankruptcy and receivers in state and federal courts of the person effecting the insurance. (2) If a policy of insurance has been or shall be effected upon the life of another person in favor of the person effecting the same or made payable otherwise to such person, the latter shall be entitled to the proceeds and avails of such policy as against the creditors, personal representatives, trustees in bankruptcy and receivers in state and federal courts of the person insured. If the person effecting such insurance shall be the spouse of the insured, he or she shall be entitled to the proceeds and avails of such policy as against his or her own creditors, trustees in bankruptcy and receivers in state and federal courts. (3) If a policy of insurance has been or shall be effected by any person on the life of another person in favor of a third person beneficiary, or made payable otherwise to a third person, such third person shall be entitled to the proceeds and avails of such policy as against the creditors, personal representatives, trustees in bankruptcy and receivers in state and federal courts of the person insured and of the person effecting the insurance. (4) (A) The person insured pursuant to paragraph one of this subsection or the person effecting the insurance other than the spouse of the insured pursuant to paragraph two hereof, and the person effecting the insurance pursuant to paragraph three hereof, or the executor or administrator of any such persons, or a person entitled to the proceeds or avails of such policy in trust for such persons shall not be deemed a third person beneficiary, assignee or payee. (B) A policy shall be deemed payable to a third person beneficiary if and to the extent that a facility-of-payment clause or similar clause in the policy permits the insurer to discharge its obligation after the death of the person insured by paying the death benefits to a third person. (5) This section shall be applicable whether or not the right is reserved in any such policy to change the designated beneficiary and whether or not the policy is made payable to the person whose life is insured if the beneficiary, assignee or payee shall predecease such person; and no person shall be compelled to exercise any rights, powers, options or privileges under such policy. (6) If a policy of insurance has been or shall be effected by any person on his own life or upon the life of another person, the policyowner shall be entitled to any accelerated payments of the death benefit or accelerated payment of a special surrender value permitted under such policy as against the creditors, personal representatives, trustees in bankruptcy and receivers in state and federal courts of the policyowner. (c) (1) No money or other benefits payable or allowable under any policy of insurance against disability arising from accidental injury or bodily infirmity or ailment of the person insured, shall be liable to execution for the purpose of satisfying any debt or liability of the insured, whether incurred before or after the commencement of the disability, except as provided in subsection (e) hereof. (2) With respect to debts or liabilities incurred for necessaries furnished the insured after the commencement of disability, the exemption shall not include any income payment benefits payable as a result of any disability of the insured, and with respect to all other debts or liabilities incurred after the commencement of disability of the insured, the exemption of income payment benefits payable as a result of any disability of the insured shall not at any time exceed payment at a rate of four hundred dollars per month for the period of such disability. (3) When a policy provides for lump sum payment because of a dismemberment or other specific loss of insured, such payment shall be exempt from execution of insured`s creditors. (4) This subsection shall not affect the assignability of any benefit otherwise assignable. (d) (1) The benefits, rights, privileges and options which, under any annuity contract are due or prospectively due the annuitant, who paid the consideration for the annuity contract, shall not be subject to execution. (2) The annuitant shall not be compelled to exercise any such rights, powers or options contained in the annuity contract, nor shall creditors be allowed to interfere with or terminate the contract, except as provided in subsection (e) hereof and except that the court may order the annuitant to pay to a judgment creditor or apply on the judgment in installments, a portion of such benefits that appears just and proper to the court, with due regard for the reasonable requirements of the judgment debtor and his family, if dependent upon him, as well as any payments required to be made by the annuitant to other creditors under prior court orders. (3) The benefits, rights, privileges or options accruing under such contract to a beneficiary or assignee shall not be transferable nor subject to commutation. If the benefits are payable periodically or at stated times, the same exemptions and exceptions contained herein for the annuitant shall apply with respect to such beneficiary or assignee. (4) The benefits, rights, privileges or options accruing under an annuity contract funding a structured settlement which would otherwise be nontransferable under this subsection may be transferred in accordance with title seventeen of article five of the general obligations law. As used in this paragraph the term "structured settlement" means an arrangement for periodic payments of damages for personal injuries established by settlement or judgment in resolution of a tort claim; and the term "periodic payments" shall include scheduled future lump sum payments. (e) (1) Every assignment or change of beneficiary or other transfer is valid, except in cases of transfer with actual intent to hinder, delay or defraud creditors, as defined by article ten of the debtor and creditor law. In such cases creditors shall have all the remedies provided by such article ten. (2) (A) Subject to the statute of limitations, the amount of premiums or other consideration paid with actual intent to defraud creditors as provided in article ten of the debtor and creditor law, together with interest on such amount, shall enure to the benefit of creditors from the proceeds of the policy or contract; but the insurer issuing such policy or contract shall be discharged of liability thereunder by making payments in accordance with its terms, or in accordance with any assignment, change of beneficiary or other transfer, unless before any such payment such insurer shall have received written notices, by or on behalf of any such creditor, of a claim to recover any benefits on the ground of a transfer or payment made with intent to defraud such creditor. (B) The notice shall specify the amount claimed or sufficient facts to enable the insurer to ascertain such amount, the insurance or annuity contract, the person insured or annuitant, and the transfers or payments sought to be avoided on the ground of fraud. (3) (A) Notwithstanding any inconsistent provision of this section or other law, any right of subrogation to benefits to which a local social services district, the department of social services, or the commissioner of health or his designee, shall be entitled shall be valid and enforceable to the extent benefits are available under any individual accident and health insurance, group or blanket accident and health insurance, or noncancellable disability insurance policy, or any subscriber contract made by a corporation subject to the provisions of article forty-three of this chapter, except that no such right of subrogation shall be enforceable if such benefits may be claimed by the department of social services, an appropriate social services official or the commissioner of health or his designee, by agreement or other established procedure, directly from an insurance carrier. (B) The right of subrogation does not attach to insurance benefits paid or provided under any health insurance policy prior to the receipt by the carrier issuing such insurance of written notice from the department of social services, a local social services district, or the commissioner of health or his designee, of the exercise of subrogation rights. (C) No right of subrogation to insurance benefits available under any health insurance policy shall be enforceable unless written notice of the exercise of such subrogation right is received by the carrier within two years from the date services for which benefits are provided under the policy or contract are rendered. (4) No terms of any policy or contract which directly or indirectly prevent or prohibit the assignment of rights under any policy or contract prevent a local social services district, the department of social services, or the commissioner of health or his designee, from claiming benefits to which it shall be subrogated. The right of subrogation attaches to any benefits paid or provided under any policy, plan or contract upon receipt of written notice of the exercise of such subrogation rights. (f) This section shall likewise apply to group insurance policies or annuity contracts, to the certificates or contracts of fraternal benefit societies, and to the policies or contracts of cooperative life and accident insurance companies. S 3213. Payment of proceeds. Where the proceeds of a policy of life insurance delivered or issued for delivery in this state are payable, according to its terms, to two or more beneficiaries without designation of their respective interests, the proceeds shall be paid to such beneficiaries in equal portions. S 3214. Interest upon proceeds of life insurance policies and annuity contracts. (a) If an action to recover the proceeds due under a policy of life insurance or contract of annuity delivered or issued for delivery in this state results in a judgment against the insurer, interest thereon shall be paid from the date of the death of the insured or annuitant in connection with a death claim on a policy of life insurance or contract of annuity and from the date of maturity of an endowment contract to the date the verdict is rendered or the report or decision is made, computed pursuant to the provisions of subsection (c) hereof, and thereafter in accord with the provisions of sections five thousand two and five thousand three of the civil practice law and rules. (b) If an action to recover is commenced and a settlement is reached before the verdict is rendered or the report or decision is made, interest on the settlement shall be paid from the date of the death of the insured or annuitant in connection with a death claim on such a policy of life insurance or contract of annuity and from the date of maturity of an endowment contract to the date of payment computed under the provisions of subsection (c) hereof. (c) If no action has been commenced, interest upon the principal sum paid to the beneficiary or policyholder shall be computed daily at the rate of interest currently paid by the insurer on proceeds left under the interest settlement option, from the date of the death of an insured or annuitant in connection with a death claim on such a policy of life insurance or contract of annuity and from the date of maturity of an endowment contract to the date of payment and shall be added to and be a part of the total sum paid. (d) This section shall not require the payment of interest for any period during which an insurer is required to pay interest under any state or federal law pertaining to interpleader. (e) This section shall not apply to policies or contracts issued prior to September first, nineteen hundred seventy-five, which contain specific provisions to the contrary. S 3215. Disability benefits in connection with life insurance and annuities. (a) No policy of life insurance or contract of deferred annuity, which provides benefits by reason of the disability of the insured, including waiver of premium, shall be delivered or issued for delivery in this state unless it contains in substance the following provisions or provisions which in the opinion of the superintendent are more favorable to policyholders: (1) That disability benefits be paid or allowed only in case of total disability and defining total disability in either of the following forms: (A) Total disability is incapacity of the insured, resulting from injury or disease, to engage in any occupation for remuneration or profit. Such a policy shall be known and described as a "total disability" policy or contract. (B) Total disability, shall exist whenever the insured`s average monthly earned income for a period of four months next preceding has, as a result of the insured`s injury or disease, not exceeded one-fourth of his former earned income averaged monthly for a period (next preceding said four months) which shall be prescribed in the policy and shall be not less than twelve months. Such a policy shall be known and described as an "earned income disability" policy or contract. (2) That disability benefits will be paid or allowed only in case such total disability is also permanent as defined in either of the following forms: (A) If such policy is a total disability policy, as defined in paragraph one hereof, a provision that total disability which has been continuous for a period specified in the contract, and which shall be not less than four months nor more than one year, shall be deemed to be permanent only with respect to determining the commencement of disability benefits. (B) If such policy is an earned income disability policy, as defined in paragraph one hereof, a provision that total disability shall be deemed to continue as long as the insured`s earned monthly income shall, as a result of injury or disease, not exceed one-fourth of his average monthly earned income as determined at the commencement of total disability. (3) That written notice of claim be given to the insurer during the lifetime of the insured and during the period of total disability. Failure to give such notice shall not invalidate or reduce any claim if it shall be shown not to have been reasonably possible to give such notice and that notice was given as soon as was reasonably possible. (4) That there be reasonable requirements as to the time, method and form of proof of disability and as to the continuance of disability, including an examination of the insured by the insurer at reasonable intervals. Failure to furnish proof of disability within the time required shall not invalidate or reduce any claim if it was not reasonably possible to give proof within such time, provided such proof is furnished as soon as reasonably possible and in no event, except in the absence of legal capacity, later than one year from the time proof is otherwise required. (5) That the contract of disability insurance shall be incontestable after it shall have been in force, during the lifetime of the insured and without the occurrence of total disability of the insured, for a period of three years from date of issue, except for nonpayment of premiums and except for the conditions of the contract relating to military or naval service. (b) Any provision in such policy or contract that total disability resulting from any specified cause shall be excluded from coverage, shall contain only the following exclusions: (1) (A) a provision terminating disability coverage when the insured becomes a member of the military, naval or air forces of any country at war, declared or undeclared; or (B) a provision terminating disability coverage when the insured becomes a member of any auxiliary or civilian non-combatant unit serving with the military, naval or air forces of any country at war, declared or undeclared; or (C) a provision excluding from coverage disability commencing within five years from the date of issue of the policy as a result of an act of war or any act incident thereto, whether such war be declared or undeclared, provided such act takes place while the insured is outside the geographical limits specified in the policy. (2) A provision excluding from the coverage disability resulting from aviation under conditions specified in the policy. (3) A provision excluding from the coverage disability directly resulting from injuries wilfully and intentionally self-inflicted. (c) No policy or contract shall contain any provision set forth in this subsection, unless it conforms substantially to the following: (1) Any provision excluding from the coverage disability resulting from disease or injury occurring before the date of issue of the policy or contract, except provisions excluding from the coverage a specific disease or injury by name or description, shall be applicable only to such disability commencing not later than two years after date of issue. (2) A provision for a reasonable adjustment of income disability benefits if the aggregate monthly amount of such benefits payable to the insured, under all contracts of insurance, exceeds a specified percentage not to exceed one hundred percent of the average monthly earned income of the insured as may be ascertained in any reasonable manner. (d) No such policy shall provide that the face amount of life insurance shall be reduced because of any disability benefits paid, except that such policy may provide, in lieu of income payments, an annuity certain for a period of not more than ten years, the value of which at its inception shall be equal to the face amount of insurance, with the provision that upon recovery such annuity shall cease and the insurance shall be restored at a proportionate premium for an amount equal to the present value of the instalments not yet due. (e) No such policy which provides income disability benefits shall contain any provision whereby the income disability benefits shall exceed a monthly rate equal to one percent of the face amount of the policy, such face amount not to include any additional benefits payable in case of accidental death and of any pure endowment benefits. (f) No such contract which provides income disability benefits shall contain any provision whereby monthly income disability benefits exceed one-twelfth of the annual annuity which would ordinarily be payable thereunder at age seventy. (g) The provisions of this section shall not apply to any group life insurance policies or group annuity contracts. (h) Within the meaning of this section: (1) "waiver of premiums" includes refund of waived premiums, if paid; (2) "income payments" means payments made monthly or at less frequent regular intervals in addition to waiver of premiums and to all benefits otherwise provided by the contract; (3) "disability benefits" means waiver of premiums, or both waiver of premium and income payments, whichever may be specified in the contract; (4) "income disability benefits" means income payments contingent upon total disability of the insured. S 3216. Individual accident and health insurance policy provisions. (a) In this section the term: (1) "Policy of accident and health insurance" includes any individual policy or contract covering the kind or kinds of insurance described in paragraph three of subsection (a) of section one thousand one hundred thirteen of this chapter. (2) "Indemnity" means benefits promised. (3) "Family" may include husband, wife, or dependent children, or any other person dependent upon the policyholder. (4) "Dependent children" includes any children under a specified age which shall not exceed age nineteen except: (A) Any unmarried dependent child, regardless of age, who is incapable of self-sustaining employment by reason of mental illness, developmental disability, or mental retardation as defined in the mental hygiene law, or physical handicap and who became so incapable prior to the age at which dependent coverage would otherwise terminate, shall be included in coverage subject to any pre-existing conditions limitation applicable to other dependents. (B) Any unmarried student at an accredited institution of learning may be considered a dependent child until attaining age twenty-three. (b) No policy of accident and health insurance, including non-cancellable disability insurance, except as provided in subsection (h) hereof, shall be delivered or issued for delivery in this state until the rate manual showing rates, rules and classifications of risks for use in connection with such accident and health insurance policies or with riders or endorsements thereon, has been filed with the superintendent. (c) No policy of accident and health insurance shall be delivered or issued for delivery to any person in this state unless: (1) The entire money and other considerations therefor are expressed therein. (2) The time at which the insurance takes effect and terminates is expressed therein. (3) It purports to insure only one person, except that a policy may insure, originally or by subsequent amendment, members of a family, as defined herein, upon the application of an adult member of the family who shall be deemed the policyholder. (4) (A) Coverage of an unmarried dependent child who is incapable of self-sustaining employment by reason of mental illness, developmental disability, or mental retardation, as defined in the mental hygiene law, or physical handicap and who became so incapable prior to attainment of the age at which dependent coverage would otherwise terminate and who is chiefly dependent upon such policyholder for support and maintenance, shall not terminate while the policy remains in force and the dependent remains in such condition, if the policyholder has within thirty-one days of such dependent`s attainment of the limiting age submitted proof of such dependent`s incapacity as described herein. (B) Coverage of a dependent spouse or named insured which would terminate upon such spouse or named insured attaining the age prescribed in subchapter XVIII of the federal Social Security Act, 42 U.S.C. SS 1395 et seq. ("medicare"), as the age of first eligibility for the benefits provided by such law shall not so terminate, if such dependent spouse is not then eligible for all of such benefits, for as long as the policy remains in force and such dependent spouse remains ineligible to receive any of such "medicare" benefits, provided proof of such ineligibility is submitted to the insurer within thirty-one days of the date notice of termination of coverage be sent by first class mail by the insurer to the last known address of the policyholder. (C) Any family coverage shall provide that coverage of newborn infants, including newly born infants adopted by the insured or subscriber if such insured or subscriber takes physical custody of the infant upon such infant`s release from the hospital and files a petition pursuant to section one hundred fifteen-c of the domestic relations law within thirty days of birth; and provided further that no notice of revocation to the adoption has been filed pursuant to section one hundred fifteen-b of the domestic relations law and consent to the adoption has not been revoked, shall be effective from the moment of birth for injury or sickness including the necessary care and treatment of medically diagnosed congenital defects and birth abnormalities including premature birth, except that in cases of adoption, coverage of the initial hospital stay shall not be required where a birth parent has insurance coverage available for the infant`s care. In the case of individual coverage the insurer must also permit the person to whom the policy is issued to elect such coverage of newborn infants from the moment of birth. If notification and/or payment of an additional premium or contribution is required to make coverage effective for a newborn infant, the coverage may provide that such notice and/or payment be made within no less than thirty days of the day of birth to make coverage effective from the moment of birth. This election shall not be required in the case of student insurance. (5) (A) Any family policy providing hospital or surgical expense insurance (but not including such insurance against accidental injury only) shall provide that, in the event such insurance on any person, other than the policyholder, is terminated because the person is no longer within the definition of the family as set forth in the policy but before such person has attained the limiting age, if any, for coverage of adults specified in the policy, such person shall be entitled to have issued to him by the insurer, without evidence of insurability, upon application therefor and payment of the first premium, within thirty-one days after such insurance shall have terminated, an individual conversion policy. The conversion privilege afforded herein shall also be available upon the divorce or annulment of the marriage of the policyholder to the former spouse of such policyholder. (B) Written notice of entitlement to a conversion policy shall be given by the insurer to the policyholder at least fifteen and not more than sixty days prior to the termination of coverage due to the initial limiting age of the covered dependent. Such notice shall include an explanation of the rights of the dependent with respect to his being enrolled in an accredited institution of learning or his incapacity for self-sustaining employment by reason of mental illness, developmental disability or mental retardation as defined in the mental hygiene law or physical handicap. (C) Such individual conversion policy shall be subject to the following terms and conditions: (i) The premium shall be that applicable to the class of risk to which such person belongs, to the age of such person and to the form and amount of insurance therefor. (ii) Such policy shall provide, on a basis specified in the family policy, the same or substantially the same benefits as those provided in the family policy or such benefits as are provided in a policy specifically approved as an individual conversion policy by the superintendent. (iii) The benefits provided under such policy shall become effective upon the date that such person was no longer eligible under the family policy. (iv) The policy may exclude any condition excluded by the family policy for such person at the time of the termination of his insurance thereunder. The policy shall not exclude any other pre-existing conditions, but the benefits paid under such policy may be reduced by the amount of any such benefits payable under the family policy after the termination of such person`s insurance thereunder and, during the first policy year of the conversion policy, the benefits payable under the policy may be reduced so that they are not in excess of those that would have been payable had such person`s insurance under the family policy remained in force and effect. (v) No insurer shall be required to issue a conversion policy if it appears that the person applying for such policy shall have at that time in force another insurance policy or hospital service or medical expense indemnity contract providing similar benefits or is covered by or is eligible for coverage by a group insurance policy or contract providing similar benefits or shall be covered by similar benefits required by any statute or provided by any welfare plan or program, which together with the conversion policy would result in overinsurance or duplication of benefits according to standards on file with the superintendent relating to individual policies. (vi) The policy may include a provision whereby the insurer may request information at any premium due date of the policy of the person covered thereunder as to whether he is then covered by another policy or hospital service or medical expense indemnity corporation subscriber contract providing similar benefits or is then covered by a group contract or policy providing similar benefits or is then provided with similar benefits required by any statute or provided by any welfare plan or program. If any such person is so covered or so provided and fails to furnish the details of such coverage when requested, the benefits payable under the conversion policy may be based on the hospital surgical or medical expenses actually incurred after excluding expenses to the extent they are payable under such other coverage or provided under such statute, plan, or program. (6) The style, arrangement and overall appearance of the policy give no undue prominence to any portion of the text, and unless every printed portion of the text of the policy and of any endorsements or attached papers is plainly printed in light-faced type of a style in general use, the size of which shall be uniform and not less than ten-point with a lower-case unspaced alphabet length not less than one hundred twenty-point (the "text" shall include all printed matter except the name and address of the insurer, name or title of the policy, the brief description, if any, and captions and subcaptions). (7) The exceptions and reductions of indemnity are set forth in the policy and, except those which are set forth in subsection (d) of this section, are printed, at the insurer`s option, either included with the benefit provision to which they apply, or under an appropriate caption such as "EXCEPTIONS", or "EXCEPTIONS AND REDUCTIONS", provided that if an exception or reduction specifically applies only to a particular benefit of the policy, a statement of such exception or reduction shall be included with the benefit provision to which it applies. (8) Each such form, including riders and endorsements, shall be identified by a form number in the lower left-hand corner of the first page thereof. (9) It contains no provision purporting to make any portion of the charter, rules, constitution, or by-laws of the insurer a part of the policy unless such portion is set forth in full in the policy, except in the case of the incorporation of, or reference to, a statement of rates or classification of risks, or short-rate table filed with the superintendent. (10) There is prominently printed on the first page thereof or there is attached thereto a notice to the effect that during a specified period of time, which shall not be less than ten days nor more than twenty days from the date the policy is delivered to the policyholder, it may be surrendered to the insurer together with a written request for cancellation of the policy and in such event the insurer will refund any premium paid therefor including any policy fees or other charges, provided, however, that this paragraph shall not apply to single premium nonrenewable policies insuring against accidents only or accidental bodily injuries only; provided, however, that a contract or certificate sold by mail order and a contract or certificate providing medicare supplemental insurance must contain a provision permitting the contract or certificate holder a thirty day period for such surrender. (11) The age limit or date or period, if any, after which the coverage provided by the policy will not be effective or the age limit, date or period after which the policy may not be renewed is stated in a renewal provision set forth on the first page of the policy or as a separate provision bearing an appropriate caption on the first page of the policy or in a brief description in not less than fourteen-point bold face type set forth on the first page of the policy. Nothing herein contained shall limit or restrict the right of the insurer to continue the policy after the age or period so stated. (12) Any policy, other than one issued in fulfillment of the continuing care responsibilities of an operator of a continuing care retirement community in accordance with article forty-six of the public health law, made available because of residence in a particular facility, housing development, or community shall contain the following notice in twelve point type in bold face on the first page: "NOTICE - THIS POLICY DOES NOT MEET THE REQUIREMENTS OF A CONTINUING CARE RETIREMENT CONTRACT. AVAILABILITY OF THIS COVERAGE WILL NOT QUALIFY A RESIDENTIAL FACILITY AS A CONTINUING CARE RETIREMENT COMMUNITY." (13) Any persons covered by the policy who are also members of a reserve component of the armed forces of the United States, including the National Guard, shall be entitled, upon written request, to have their coverage suspended during a period of active duty as described herein. The policy shall provide that the insurer will refund any unearned premiums for the period of such suspension. Persons covered by the policy shall be entitled to resumption of coverage, upon written application and payment of the required premium within sixty days after the date of termination of the period of active duty, with no limitations or conditions imposed as a result of such period of active duty except as set forth in subparagraphs (A) and (B) herein. Coverage shall be retroactive to the date of termination of the period of active duty. Such right of resumption provided for herein shall be in addition to other existing rights granted pursuant to state and federal laws and regulations and shall not be deemed to qualify or limit such rights in any way. No exclusion or waiting period may be imposed in connection with coverage of a health or physical condition of a person entitled to such right of resumption, or a health or physical condition of any other person who is covered by the policy unless: (A) the condition arose during the period of active duty and the condition has been determined by the secretary of veterans affairs to be a condition incurred in the line of duty; or (B) a waiting period was imposed and had not been completed prior to the period of suspension; in no event, however, shall the sum of the waiting periods imposed prior to and subsequent to the period of suspension exceed the length of the waiting period originally imposed. (14) To be entitled to the right defined in paragraph thirteen of this subsection a person must be a member of a component of the armed forces of the United States, including the National Guard, who either: (A) voluntarily or involuntarily enters upon active duty (other than for the purpose of determining his or her physical fitness and other than for training), or (B) has his or her active duty voluntarily or involuntarily extended during a period when the president is authorized to order units of the ready reserve or members of a reserve component to active duty, provided that such additional active duty is at the request and for the convenience of the federal government, and (C) serves no more than four years of active duty. (d) Each policy of accident and health insurance delivered or issued for delivery to any person in this state shall contain the provisions specified herein in the words in which the same appear in this subsection, except that the insurer may, at its option, substitute for one or more of such provisions corresponding provisions of different wording approved by the superintendent which are not less favorable in any respect to the insured or the beneficiary. Each provision contained in the policy shall be preceded by the applicable caption herein or, at the insurer`s option, by such appropriate captions or subcaptions as the superintendent may approve. (1) Each policy shall, except with respect to designation by numbers or letters as used below, contain the following provisions: (A) ENTIRE CONTRACT; CHANGES: This policy, including the endorsements and the attached papers, if any, constitutes the entire contract of insurance. No change in this policy shall be valid until approved by an executive officer of the insurer and unless such approval be endorsed hereon or attached hereto. No agent or broker has authority to change this policy or to waive any of its provisions. (B) TIME LIMIT ON CERTAIN DEFENSES: (i) After two years from the date of issue of this policy no misstatements, except fraudulent misstatements, made by the applicant in the application for such policy shall be used to void the policy or to deny a claim for loss incurred or disability (as defined in the policy) commencing after the expiration of such two year period. (The foregoing policy provision shall not be so construed as to affect any legal requirement for avoidance of a policy or denial of a claim during such initial two year period, nor to limit the application of subparagraphs (A) through (E), inclusive, of this paragraph in the event of misstatement with respect to age or occupation or other insurance.) (A policy which the insured has the right to continue in force subject to its terms by the timely payment of premium until at least age fifty or, in the case of a policy issued after age forty-four, for at least five years from its date of issue, may contain in lieu of the foregoing the following provision (from which the clause in parentheses may be omitted at the insurer`s option) under the caption "INCONTESTABLE": After this policy has been in force for a period of two years during the lifetime of the insured (excluding any period during which the insured is disabled), it shall become incontestable as to the statements contained in the application.) (ii) No claim for loss incurred or disability (as defined in the policy) commencing after two years from the date of issue of this policy shall be reduced or denied on the ground that a disease or physical condition not excluded from coverage by name or sp

NY Insurance Law

Article 32Insurance Contracts - Life, Accident, and Health Annuities

Article 32
Insurance Contracts - Life, Accident,
and Health Annuities