Naic: Model Policy Loan Interest Rate Bill National Association Of Insurance Commissioners
Definition of "Naic: model policy loan interest rate bill national association of insurance commissioners"
Bill that allows the insurance company to include a clause in its policy that permits the policyholder to make a policy loan at a variable interest rate on new policies. Under this clause, the following must be instituted by the insurance company: interest rate cannot be changed more than four times each year; at least once each year, an evaluation must be made of the requirement for any change in the interest rate; interest rate cannot be changed to that of a rate higher than Moody's Composite Yield on seasoned corporate bonds, which is in effect two months prior to the establishment of the new rate or to a rate higher than the interest rate being credited to the cash value plus 1%. The rate change calculation that is utilized is the decision of the insurance company. No change in the interest rate can be made unless the adjustment is for an increase of at least one-half of 1 %. Should the interest rate charged on policy loans currently decrease to an amount at least equal to one-half of 1% of that rate currently being charged, then the variable loan rate must be lowered in turn. There remains no requirement for the insurance company to actually increase the interest rate or to use a variable interest rate; the sole use of fixed interest rates is still permissible.
Popular Insurance Terms
Observance of an event occurring on a repeated basis that leads one to believe that a certain probability is attached to the occurrence of that event. For example, if there are a red ball ...
Same as term Contingent Business Income Coverage Form: coverage for loss in the net earnings of a business if a supplier business, subcontractor, key customer, or manufacturer doing ...
Frequency with which employees resign, are fired, or retire from a company, usually computed as the percentage, of an organization's employees at the beginning of a calendar year. The ...
Policy under which a portion of the death benefit (generally 25%) becomes payable to the insured for a specified medical condition prior to death. The purpose of the accelerated death ...
Individual prohibited under the employee retirement income security act of 1974 (erisa) from conducting transactions with a trust plan. The prohibition is intended to prevent a conflict of ...
Hospital, physician, or other provider of health care that an insurer recommends to insureds. A PPO allows insurance companies to negotiate directly with hospitals and physicians for health ...
Latin phrase meaning "beyond power or authority" describing an act by a corporation that exceeds its legal powers. For example, corporations do not have the authority to engage in the ...
State law that stipulates the establishment of required reserves for claims made basis liability coverage contracts, removes the excess statutory reserves, and directs that all amounts that ...
To accumulate. For example, under one of the dividend options of a participating life insurance policy, dividends can accumulate at interest by leaving them with the insurance company; cash ...
Have a question or comment?
We're here to help.