N.J. Admin. Code § 11:4-45.7

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

Section 11:4-45.7 - Illustrated forms

(a) In the case of a policy for which illustrations shall be used pursuant to N.J.A.C. 11:4-52, the insurer shall provide each policyholder or contractholder with a periodic report on the status of the policy, which shall satisfy the following requirements:

1. The report shall be provided at least annually;

2. For fixed premium account value policies, if assuming guaranteed interest, mortality and expense loads and continued scheduled premium payments, the policy's net cash surrender value is such that it would not maintain insurance in force until the end of the next reporting period, a notice to this effect shall be included in the report;

3. For flexible premium account value policies, if assuming guaranteed interest, mortality and expense loads, the policy's net cash surrender value will not maintain insurance in force until the end of the next reporting period unless further premium payments are made, a notice to this effect shall be included in the report;

4. For all other policies, the report shall show, where applicable:

i. Current death benefit;

ii. Annual contract premium;

iii. Current cash surrender value;

iv. Current dividend;

v. Application of current dividend; and

vi. Amount of outstanding loan.

(b) Insurers writing life insurance policies that do not build nonforfeiture values shall only be required to provide a periodic report pursuant to this section with respect to these policies for those years when a change has been made to non-guaranteed policy elements by the insurer.

(c) If the periodic report does not include an in force illustration, it shall contain the following notice displayed prominently: "IMPORTANT POLICY OWNER NOTICE: You should consider requesting more detailed information about your policy to understand how it may perform in the future. You should not consider replacement of your policy or make changes in your coverage without requesting a current illustration. You may annually request, without charge, such an illustration by calling (insurer's phone number), writing to (insurer's name) at (insurer's address) or contacting your agent. If you do not receive a current illustration of your policy within 30 days from your request, you should contact your state insurance department." The insurer may vary the sequential order of the methods for obtaining an in force illustration.

(d) If an adverse change in non-guaranteed elements that could affect the policy has been made by the insurer since the last periodic report, the report shall contain a notice of that fact and the nature of the change prominently displayed.

(e) For flexible-factor forms, the report shall satisfy all of the applicable requirements of this subchapter in addition to the requirements set forth in this section.

N.J. Admin. Code § 11:4-45.7

New Rule, R.1998 d.337, effective 7/6/1998.
See: 30 New Jersey Register 275(a), 30 New Jersey Register 2492(a).
Former N.J.A.C. 11:4-45.7, Penalties, recodified to N.J.A.C. 11:4-45.8.