Current through Register Vol. 54, No. 49, December 7, 2024
Section 87.3 - Guaranteed annual endowments(a) A life insurance policy containing a series of pure guaranteed annual endowments evidenced by coupons, passbooks or similar devices generally identified with investment or banking operations will not be approved for use and the policy heretofore approved may not be issued or delivered in this Commonwealth on or after February 26, 1968.(b) Another life insurance policy containing a series of pure guaranteed annual endowments will not be approved for use and the policy heretofore approved may not be issued or delivered in this Commonwealth on or after February 26, 1968, unless all of the following requirements are satisfied: (1) The gross premium for the pure guaranteed annual endowment benefit shall be shown prominently and separately in the policy, distinct from the gross premium for the life insurance benefit.(2) The insured shall be entitled to withdraw the pure guaranteed annual endowments not less frequently than at the end of the second policy year and at the end of each policy year thereafter. The amount of the endowments available for withdrawal may not be less than the aggregate premium paid for the endowments less any prior withdrawals.(3) Payment of a pure guaranteed annual endowment may not be made contingent upon the payment of premiums falling due on or after the time the pure guaranteed annual endowment benefit has matured.(4) The separately stated gross premium for the series of pure guaranteed annual endowments shall be based on reasonable assumptions and shall be consistent with the basic policy form as to interest, mortality and expense.(5) The amount of each of the pure guaranteed annual endowments shall be expressed in dollars, both in the policy and in sales or advertising material relating thereto, not as a percentage of a premium or benefit.(6) A pure guaranteed annual endowment may not be described, either in the policy or in sales or advertising material, as anything other than a guaranteed benefit for which a premium is being paid by the policyholder.(7) At the time the policy form is filed with the Department for approval, it shall be accompanied by the materials, including any sales presentation "kit" which the insurance company proposes to use in connection with the policy.(c) Nothing in subsection (a) or (b) may apply to a policy in which the amount of a pure endowment or periodic benefit or benefits payable during a policy year is greater than the total annual premium for the year.