New Jersey Administrative Code
Title 11 - INSURANCE
Chapter 4 - ACTUARIAL SERVICES
Subchapter 11 - LIFE INSURANCE DISCLOSURE
Section 11:4-11.2 - Definitions
The following words and terms, when used in this subchapter, shall have the following meanings, unless the context clearly indicates otherwise:
"Annuity" means a contract not included within the definition of life insurance as set forth at 17B:17-3, or health insurance as set forth at 17B:17-4, under which an insurer obligates itself to make periodic payments for a specified period of time, such as for a number of years, or until the happening of an event, or for life, or for a period of time determined by any combination thereof. Such a contract, which includes extra benefits of the kinds set forth at 17B:17-3 or 4 shall nevertheless be deemed to be an annuity if such extra benefits constitute a subsidiary or incidental part of the entire contract. Subsidiary or incidental death benefits are set forth at 11:4-43.3(h).
"Buyer's Guide" means a document that contains, and is limited to, the following: the language included in the appendix to this subchapter and a notice containing information about the Office of the Insurance Claims Ombudsman as specifically set forth at 11:25-1.7.
"Commissioner" means the Commissioner of the New Jersey Department of Banking and Insurance.
"Credit life insurance" means insurance on the life of a debtor pursuant to or in connection with a specific loan or other credit transaction as defined at 45:7-82.
"Current scale of non-guaranteed elements" means a formula or other mechanism that produces values for an illustration as if there is no change in the basis of those values after the time of illustration.
"Department" means the New Jersey Department of Banking and Insurance.
"Generic name" means a short title that is descriptive of the premium and benefit patterns of a policy or a rider.
"Group life insurance" means a policy or contract of life insurance that covers more than one person as part of a group that satisfies the specifications of 17B:27-68 or 69.
"Insurer" includes every person engaged as indemnitor or contractor in the business of life insurance.
"Life insurance" means a policy or contract whereby an insurer is obligated to pay or allow a benefit of pecuniary value with respect to the cessation of human life. Life insurance also includes the granting of endowment benefits and optional modes of settlement of proceeds of life insurance, as well as provisions for:
1. Additional benefits in the event of death by accident or accidental means or in the event of dismemberment or loss of sight; or
2. Safeguarding such insurance against lapse or giving a special surrender value or special benefit or an annuity in the event that the insured shall become totally and permanently disabled, whether such provisions are incorporated in a policy or contract of life insurance or in a policy or contract supplemental thereto. Life insurance does not include worker's compensation coverages.
"Non-guaranteed elements" means the premiums, credited interest rates (including any bonus), benefits, values, non-interest based credits, charges or elements of formulas used to determine any of these, that are subject to company discretion and are not guaranteed at issue. An element is considered non-guaranteed if any of the underlying non-guaranteed elements are used in its calculation.
"Policy data" means a display or schedule of numerical values, both guaranteed and non-guaranteed, for each policy year or a series of designated policy years of the following information: illustrated annual, other periodic, and terminal dividends; premiums; death benefits; cash surrender values; and endowment benefits.
"Policy owner" means the owner named in the policy.
"Policy summary" means a written statement describing the elements of the policy, including, but not limited to:
1. A prominently placed title as follows: "STATEMENT OF POLICY COST AND BENEFIT INFORMATION";
2. The name and address of the insurance producer or, if no producer 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 or administrative office address of the company in which the life insurance policy is to be or has been written;
4. The generic name of the basic policy and each rider;
5. 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 at least one age from 60 through 65 and policy maturity:
i. The annual premium for the basic policy;
ii. The annual premium for each optional rider;
iii. The 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, that is provided by the basic policy and each optional rider; with benefits provided under the basic policy and each rider shown separately;
iv. The total guaranteed cash surrender values at the end of the year with values shown separately for the basic policy and each rider; and
v. Any guaranteed endowment amounts payable under the policy that are not included under 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 loan interest rate is adjustable, the policy summary shall also indicate that the annual percentage rate will be determined by the company in accordance with the provisions of the policy and the applicable law; and
7. The date on which the policy summary is prepared.
"Producer" means a person required to be licensed under the laws of this State to sell, solicit or negotiate insurance pursuant to 17:22A-26 et seq.
"Variable life insurance" means a separate account life insurance policy or contract providing for the dollar amount of life insurance to vary so as to reflect investment results of one or more separate accounts in which amounts with respect to any such policy or contract have been placed.
