§ 27-1-12-6 — Required provisions of policies after transition date or January 1, 1948

(a) No policy of life insurance, other than
industrial insurance, group life insurance or reinsurance, bearing a date
of issue which is the same as or later than a transition date to be
selected by the company pursuant to section 12 of this chapter, such
transition date in no event to be later than January 1, 1948, shall be
delivered or issued for delivery in this state or issued by a company
organized under the laws of this state unless the same shall provide the
following:
(1) That all premiums shall be payable in advance, either at the
home office of the company, or to an agent of the company, upon
delivery of a receipt signed by one (1) or more of the officers who
shall be designated in the policy.
(2) For a grace period of not less than thirty (30) days for the
payment of every premium after the first premium, which may be
subject to an interest charge, during which period the insurance
shall continue in force; provided, that if the insured shall die
within such period of grace the unpaid premium for the current
policy year may be deducted in any settlement under the policy.
(3) That the policy, together with the application therefor, a copy
of which application shall be attached to the policy and made a
part thereof, shall constitute the entire contract between the
parties and shall be incontestable after it shall have been in force
during the lifetime of the insured for two (2) years from its date,
or, at the option of the company after it shall have been in force
for two (2) years from its date, except for nonpayment of
premiums, and except for violation of the conditions of the policy
relating to naval and military service in time of war, and at the
option of the company provisions relative to benefits in the event
of total and permanent disability and provisions which grant
additional insurance specifically against death by accident may
also be excepted.
(4) That if the age of the insured and/or beneficiary, if that age
enters into the determination of the premiums charged or benefits
promised, has been misstated, the amount payable under the
policy shall be such as the premium would have purchased at the
correct age of the insured and/or beneficiary.
(5) That all statements made by the insured in the application
shall, in the absence of fraud, be deemed representations and not
warranties.
(6) That, in the case of participating policies, the policy shall
participate in the surplus of the company as apportioned by the
board of directors of the company, and that, beginning not later
than the end of the fifth policy year, the company will determine
and account for the portion of the divisible surplus so ascertained
accruing on the policy, and that the owner of the policy shall have
the right to have the current dividends arising from such
participation paid in cash, and that at periods of not more than
five (5) years, such accounting and payment at the option of the
policyholder shall be had. The owner of the policy may elect to
take any of the other dividend options in the policy. If the owner
of the policy shall not elect any of the other dividend options
provided in the policy, the apportioned dividends shall be held to
the credit of the policy and be payable in cash at maturity of the
policy or be withdrawable in cash at any anniversary of its date;
provided, however, that if the policy shall contain a provision for
an apportionment of the surplus at the end of the first policy year
and annually thereafter, then and in that event, said policy may
provide that each dividend shall be paid subject to the payment of
the premium of the next ensuing year.
(7) Nonforfeiture provisions in accordance with the requirements
of section 7 of this chapter.
(8) That the company, at any time while the policy is in force, will
loan, on the execution of a proper assignment of the policy, and
on the sole security thereof, at a specified rate of interest (payable
in advance if the company so elects), a sum, which, together with
the sum of:
(A) previously existing indebtedness, if any, including interest
thereon to the end of the current policy year; and
(B) interest to the end of the current policy year on the amount
newly loaned;
is equal to or, at the option of the insured, less than the cash
surrender value at the end of the current policy year as provided
for by the policy in accordance with the terms of section 7 of this
chapter; provided, that the company may, as a condition precedent
to the making of such loan, and at its own option, require the
payment of the unpaid balance, if any, of the premium or
premiums for the current policy year, and may require the
payment of interest in advance on the total loan to the end of the
current policy year. The policy may provide that, if interest on the
loan is not paid when due, it shall be added to the existing loan
and become a part thereof and bear interest at the same rate as the
loan. It shall further be stipulated in the policy that failure to
repay any such loan or pay interest thereon shall not void the
policy unless such total indebtedness to the company shall equal
or exceed such cash surrender value at the time of such failure,
nor until thirty (30) days after notice shall have been mailed by
the company to the last known address of the insured and to the
assignee, if any, if such assignee has notified the company of the
assignee's address. No condition other than as provided in this
subdivision shall be exacted as prerequisite to any such loan. The
company shall reserve the right to defer the granting of any loan,
except when made to pay premiums on a policy or policies issued
by it, for six (6) months after application therefor is made. The
provisions of this subdivision shall not be required in term
policies nor shall they apply to paid-up insurance issued or
granted in exchange for lapsed or surrendered policies.
(9) That, should there have been default in premium payment and
the value of the policy applied to the extension of the insurance,
and such insurance be in force and the original policy not
surrendered to the company and canceled, the policy may be
reinstated within three (3) years from the due date of the premium
in default, upon evidence of insurability satisfactory to the
company and payment of arrears of premiums with interest.
(10) That when a policy shall become a claim by the death of the
insured, settlement shall be made upon receipt of due proof of
death and of the interest of the claimant and not later than two (2)
months after receipt of such proof.
(11) A title on the face and on the back of the policy describing
the same.
(b) Any of the provisions of subsection (a) not applicable to single
premium policies shall to that extent not be incorporated in a single
premium policy. The provisions of subsection (a) shall not apply to
policies issued on substandard, underaverage, or impaired risks. Any
policy may be issued or delivered in this state which in the opinion of
the department contains provisions on any one (1) or more of the
several requirements of subsection (a) more favorable to the
policyholder than those required in subsection (a).
Formerly: Acts 1935, c.162, s.151A; Acts 1943, c.189, s.2; Acts
1959, c.146, s.1. As amended by P.L.252-1985, SEC.61; P.L.136-2018,
SEC.157.