§ 10-7-303 — Computation of cash surrender value

(1) (a) Except as provided
in paragraphs (b) and (c) of this subsection (1), any cash surrender value available
under the policy in the event of default in a premium payment due on any policy
anniversary, whether or not required by section 10-7-302, shall be an amount not
less than the excess, if any, of the present value, on such anniversary, of the future
guaranteed benefits which would have been provided for by the policy, including
any existing paid-up additions, if there had been no default, over the sum of:

(I) The then present value of the adjusted premiums, as defined in sections
10-7-305 and 10-7-305.1, corresponding to premiums which would have fallen due
on and after such anniversary; and

(II) The amount of any indebtedness to the company on the policy.

(b) For any policy issued on or after the operative date of section 10-7-305.1
which provides supplemental life insurance or annuity benefits at the option of the
insured and for an identifiable additional premium by rider or supplemental policy
provision, the cash surrender value referred to in paragraph (a) of this subsection (1)
shall be an amount not less than the sum of the cash surrender value as defined in
said paragraph (a) for an otherwise similar policy issued at the same age without
such rider or supplemental policy provision and the cash surrender value as defined
in said paragraph (a) for a policy which provides only the benefits otherwise
provided by such rider or supplemental policy provision.

(c) For any family policy issued on or after the operative date of section 10-7-305.1 which defines a primary insured and provides term insurance on the life of the
spouse of the primary insured expiring before the spouse reaches age seventy-one,
the cash surrender value referred to in paragraph (a) of this subsection (1) shall be
an amount not less than the sum of the cash surrender value as defined in said
paragraph (a) for an otherwise similar policy issued at the same age without such
term insurance on the life of the spouse and the cash surrender value as defined in
said paragraph (a) for a policy which provides only the benefits otherwise provided
by such term insurance on the life of the spouse.

(2) Any cash surrender value available within thirty days after any policy
anniversary under any policy paid up by completion of all premium payments or any
policy continued under any paid-up nonforfeiture benefit, whether or not required
by section 10-7-302, shall be an amount not less than the present value, on such
anniversary, of the future guaranteed benefits provided for by the policy, including
any existing paid-up additions, decreased by any indebtedness to the company on
the policy.

Legislative History

Source: L. 61: p. 461, � 3. CRS 53: � 72-20-3. C.R.S. 1963: � 72-19-3. L. 81: Entire section amended, p. 543, � 2, effective July 1.