HARRY HUGHES, Governor

3375

(3)  IN THE CASE OF POLICIES WHICH CAUSE, ON A
BASIS GUARANTEED IN THE POLICY, UNSCHEDULED CHANGES IN
BENEFITS OR PREMIUMS, OR WHICH PROVIDE AN OPTION FOR CHANGES
IN BENEFITS OR PREMIUMS OTHER THAN A CHANGE TO A NEW POLICY,
THE ADJUSTED PREMIUMS AND PRESENT VALUES SHALL INITIALLY BE
CALCULATED ON THE ASSUMPTION THAT FUTURE BENEFITS AND
PREMIUMS WILL NOT CHANGE FROM THOSE STIPULATED AT THE DATE
OF ISSUE OF THE POLICY. AT THE TIME OF ANY CHANGE IN THE
BENEFITS OR PREMIUMS, THE FUTURE ADJUSTED PREMIUMS,
NONFORFEITURE NET LEVEL PREMIUMS, AND PRESENT VALUES SHALL
BE RECALCULATED ON THE ASSUMPTION THAT FUTURE BENEFITS AND
PREMIUMS WILL NOT CHANGE FROM THOSE STIPULATED BY THE POLICY
IMMEDIATELY AFTER THE CHANGE.

(4)  EXCEPT AS OTHERWISE PROVIDED IN SUBPARAGRAPH
(7) OF THIS SUBSECTION, THE RECALCULATED FUTURE ADJUSTED
PREMIUMS FOR ANY POLICY DESCRIBED IN SUBPARAGRAPH (3) SHALL
BE THE UNIFORM PERCENTAGE OF THE RESPECTIVE FUTURE PREMIUMS
SPECIFIED IN THE POLICY FOR EACH POLICY YEAR, EXCLUDING
AMOUNTS PAYABLE AS EXTRA PREMIUMS TO COVER IMPAIRMENTS AND
SPECIAL HAZARDS, AND ALSO EXCLUDING ANY UNIFORM ANNUAL
CONTRACT CHARGE OR POLICY FEE SPECIFIED IN THE POLICY IN A
STATEMENT OF THE METHOD TO BE USED IN CALCULATING THE CASH
SURRENDER VALUES AND PAID-UP NONFORFEITURE BENEFITS, SO THAT
THE PRESENT VALUE, AT THE TIME OF CHANGE TO THE NEWLY
DEFINED BENEFITS OR PREMIUMS, OF ALL SUCH FUTURE ADJUSTED
PREMIUMS SHALL BE EQUAL TO THE EXCESS OF:

(I)  THE SUM OF:

1.  THE PRESENT VALUE OF THE THEN
FUTURE GUARANTEED BENEFITS PROVIDED FOR BY THE POLICY; AND

2.  THE ADDITIONAL EXPENSE ALLOWANCE,
IF ANY, OVER

(II)  THE THEN CASH SURRENDER VALUE, IF
ANY, OR PRESENT VALUE OF ANY PAID-UP NONFORFEITURE BENEFIT
UNDER THE POLICY.

(5)  THE ADDITIONAL EXPENSE ALLOWANCE, AT THE
TIME OF THE CHANGE TO THE NEWLY DEFINED BENEFITS OR
PREMIUMS, SHALL BE THE SUM OF:

(I)  1 PERCENT OF THE EXCESS, IF POSITIVE,
OF THE AVERAGE AMOUNT OF INSURANCE AT THE BEGINNING OF EACH
OF THE FIRST 10 POLICY YEARS SUBSEQUENT TO THE CHANGE OVER
THE AVERAGE AMOUNT OF INSURANCE PRIOR TO THE CHANGE AT THE
BEGINNING OF EACH OF THE FIRST 10 POLICY YEARS SUBSEQUENT TO
THE TIME OF THE MOST RECENT PREVIOUS CHANGE, OR, IF THERE
HAS BEEN NO PREVIOUS CHANGE, THE DATE OF ISSUE OF THE
POLICY; AND

(II)  125 PERCENT OF THE INCREASE, IF
POSITIVE, IN THE NONFORFEITURE NET LEVEL PREMIUM.