§ 26.1-34-01 — Required annuity contract provisions relating to cessation of payment of considerations by contractholder

North Dakota § 26.1-34-01

• Jurisdiction: North Dakota
• Title 26.1: Insurance
• Ch. 26.1-34: Annuities

Text

considerations by contractholder.
In the case of annuity contracts issued after June 30, 1979, unless the company, by written
notice filed with the commissioner, opted for an earlier operative date, no annuity contract,
except as stated in section 26.1-34-10, may be delivered or issued for delivery in this state
unless it contains in substance the following provisions, or corresponding provisions which in
the opinion of the commissioner are at least as favorable to the contractholder upon cessation
of payment of considerations under the contract:
1. Upon cessation of payment of considerations under an annuity contract, the company
will grant a paid-up annuity benefit on a plan stipulated in the contract of such value as
is specified in sections 26.1-34-03 through 26.1-34-06 and section 26.1-34-08.
2. If an annuity contract provides for a lump sum settlement at maturity, or at any other
time, then upon surrender of the contract at or prior to the commencement of any
annuity payments, the company will pay in lieu of any paid-up annuity benefit a cash
surrender benefit of such amount as is specified in sections 26.1-34-03, 26.1-34-04,
26.1-34-06, and 26.1-34-08. The company shall reserve the right to defer the payment
of the cash surrender benefit for a period of six months after demand for the benefit
with surrender of the contract.
3. A statement of the mortality table, if any, and interest rates used in calculating any
minimum paid-up annuity, cash surrender, or death benefits that are guaranteed under
the annuity contract, together with sufficient information to determine the amounts of
the benefits.
4. A statement that any paid-up annuity, cash surrender, or death benefits that may be
available under the annuity contract are not less than the minimum benefits required
by any law of this state and an explanation of the manner in which the benefits are
altered by the existence of any additional amounts credited by the company to the
contract, any indebtedness to the company on the contract, or any prior withdrawals
from or partial surrenders of the contract.
5. A statement that when an annuity contract becomes a claim by reason of death,
settlement:
a. If payable in one sum, must be made upon due proof of death, or not later than
two months after receipt of the proof, and must include reasonable interest
accrued from the date of death; or
b. If made under a settlement option other than subdivision a, must include
reasonable interest accrued from date of death until such option is made
according to the provisions of the contract.
As used in this subsection, the term "reasonable interest" means the same rate of
interest as paid on death proceeds left on deposit with the insurer.
Notwithstanding the requirements of this section, any deferred annuity contract may provide that
if no considerations have been received under a contract for a period of two full years and the
portion of the paid-up annuity benefit at maturity on the plan stipulated in the contract arising
from considerations paid prior to such period would be less than twenty dollars monthly, the
company may at its option terminate the contract by payment in cash of the then present value
of such portion of the paid-up annuity benefit, calculated on the basis of the mortality table, if
any, and interest rate specified in the contract for determining the paid-up annuity benefit, and
by such payment is relieved of any further obligation under the contract.