234                              Laws of Maryland                       [Ch. 183

notated Code of Maryland (1957 Edition), title "Insurance", sub-
title "Life, Accident and Health Insurance", sub-heading "In Gen-
eral", be and the same are hereby repealed and re-enacted, with
amendments, and that new Section 197 (4A) be and the same is
hereby added to said Article 48A to follow immediately after Sec-
tion 197 (4) thereof, all of which to read as follows:

197.

(2) Any cash surrender value available under the policy in the
event of default in a premium payment due on any policy anniver-
sary, whether or not required by subsection (1), shall be an amount
not less than the excess, if any, of the present value, on such anni-
versary, 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 (A) the then present
value of the adjusted premiums as defined in [subsection (4),]
subsections (4) and (4A), corresponding to premiums which would
have fallen due on and after such anniversary, and (B) the amount
of any indebtedness to the company on the policy. Any cash sur-
render value available within thirty days after any policy anni-
versary under any policy paid up by completion of all premium pay-
ments or any policy continued under any paid-up nonforfeiture
benefit, whether or not required by subsection (1), 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 exist-
ing paid-up additions, decreased by any indebtedness to the company
on the policy.

(4) The adjusted premiums for any policy shall be calculated on
an annual basis and shall be such uniform percentage of the respec-
tive premiums specified in the policy for each policy year that the
present value, at the date of issue of the policy, of all such adjusted
premiums shall be equal to the sum of (i) the then present value of
the future guaranteed benefits provided for by the policy; (ii) two
per cent of the amount of insurance, if the insurance be uniform in
amount, or of the equivalent uniform amount, as hereinafter defined,
if the amount of insurance varies with duration of the policy; (iii)
forty per cent of the adjusted premium for the first policy year; (iv)
twenty-five per cent of either the adjusted premium for the first poli-
cy year or the adjusted premium for a whole life policy of the same
uniform or equivalent uniform amount with uniform premiums for
the whole of life issued at the same age for the same amount of in-
surance, whichever is less. Provided, however, that in applying the
percentages specified in (iii) and (iv) above, no adjusted premium
shall be deemed to exceed four per cent (4%) of the amount of in-
surance or level amount equivalent thereto. The date of issue of
a policy for the purpose of this subsection shall be the date of which
the rated age of the insured is determined.

In the case of a policy providing an amount of insurance vary-
ing with duration of the policy, the equivalent level amount thereof
for the purpose of this subsection shall be deemed to be the level
amount of insurance provided by an otherwise similar policy, contain-
ing the same endowment benefit or benefits, if any, issued at the same
age and for the same term, the amount of which does not vary with
duration and the benefits under which have the same present value
at the inception of the insurance as the benefits under the policy.