N.J. Admin. Code § 11:4-30.7

Current through Register Vol. 56, No. 24, December 18, 2024

Section 11:4-30.7 - Payment options

(a) Payment options available to the owner shall include the right to receive the accelerated death benefit in lump sum and may include an option to receive the benefit in periodic payments for a term certain period (that is, without life contingencies).

1. In no event shall the amount payable as a lump sum be less than the percentage of the death benefit being accelerated multiplied by the current cash value less outstanding policy or certificate loans. The current cash value shall include any termination dividend payable on the surrender of the policy or certificate.

2. Periodic payments with life contingencies are not permitted.

3. Payment options shall specify what occurs if the insured dies before all payments of the accelerated death benefit are made. If such a death occurs and the present value of the remaining payments is paid in a lump sum, the interest rate used to calculate the present value shall be that assumed in calculating the original term certain periodic payments.

(b) If the insured dies after the owner elects to receive accelerated death benefits but before any such benefits are received, the election shall be cancelled and the death benefit paid pursuant to the policy.

N.J. Admin. Code § 11:4-30.7

Amended by R.2000 d.170, effective 4/17/2000.
See: 32 N.J.R. 167(a), 32 N.J.R. 1396(a).
In (a), substituted "and may include options to receive the benefit" for "or" in the introductory paragraph.
Amended by R.2012 d.096, effective 5/7/2012.
See: 43 N.J.R. 3119(a), 44 N.J.R. 1531(a).
Rewrote the introductory paragraph of (a) and (a)3; in (a)1, deleted "acceleration" preceding "percentage", inserted "of the death benefit being accelerated" and inserted "or certificate" twice; deleted (a)4; and in (b), deleted "policy" preceding and "or certificate holder" following "owner".