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
Insurance for accountants covering liability lawsuits arising from their professional activities. For example, an investor bases a buying decision on the balance sheet of a company's annual ...
Entitlement of a participant in an employee benefit insurance plan to receive benefits regardless of his or her employment status. ...
Loss that is not a direct result of a peril. For example, damage to property of a business firm would be a direct loss, but the loss of business earnings because of a fire on its premises ...
Insurance facility composed of many different syndicates, each specializing in a particular risk; for example, hull risks. Lloyd's provides coverage for primary jumbo risks as well as ...
Individual or other entity who owns an insurance policy. Synonymous with policyowner. ...
Policy that pays a specified sum not related in any way to the extent of the loss. The term applies to a life insurance policy rather than to a contract of indemnity because the former does ...
U.S. government agency (formerly the Atomic Energy Commission) responsible for regulating the nuclear energy industry. The commission also provides supplemental insurance for nuclear ...
Health insurance coverage offered by some states for medical expenses and loss of income from nonoccupational disability. The merits of federal health insurance have been debated for some ...
Coverage for less than one year. Insurers generally charge higher rates for short-term policies than for longer term insurance, such as an annual policy, because of the need to recoup ...
Have a question or comment?
We're here to help.