New Jersey Administrative Code
Title 11 - INSURANCE
Chapter 4 - ACTUARIAL SERVICES
Subchapter 30 - ACCELERATED DEATH BENEFITS
Section 11:4-30.7 - Payment options
Universal Citation: NJ Admin Code 11:4-30.7
Current through Register Vol. 56, No. 6, March 18, 2024
(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.
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