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Session Laws, 1983
Volume 745, Page 2026   View pdf image
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Ch. 635
LAWS OF MARYLAND
2026
(2)  NOTIFY THE POLICYHOLDER WITH RESPECT TO PREMIUM
LOANS OF THE BEGINNING ANNUAL RATE OF INTEREST ON THE LOAN AS
SOON AS IS REASONABLY PRACTICAL AFTER MAKING THE INITIAL LOAN; (3)  GIVE REASONABLE ADVANCE NOTICE TO POLICYHOLDERS
WITH OUTSTANDING LOANS OF ANY INCREASE IN THE RATE; AND (4)   INCLUDE IN THE NOTICES REQUIRED UNDER THIS
SUBSECTION THE SUBSTANCE OF THE RELEVANT PROVISIONS OF
SUBSECTIONS (B) AND (D) OF THIS SECTION. (H) THE LOAN VALUE OF THE POLICY SHALL BE DETERMINED IN
ACCORDANCE WITH § 408A OR § 414 OF THIS ARTICLE BUT A POLICY MAY
NOT TERMINATE IN A POLICY YEAR AS THE SOLE RESULT OF CHANGE IN
THE INTEREST RATE DURING THAT POLICY YEAR, AND THE LIFE INSURER
SHALL MAINTAIN COVERAGE DURING THAT POLICY YEAR UNTIL THE TIME IT
WOULD OTHERWISE HAVE TERMINATED IF THERE HAD BEEN NO CHANGE
DURING THAT POLICY YEAR. (I) THE SUBSTANCE OF THIS PERTINENT PROVISIONS OF
SUBSECTIONS (B) AND (D) OF THIS SECTION SHALL BE SET FORTH IN THE
POLICIES TO WHICH THEY APPLY. (J) FOR PURPOSES OF THIS SECTION: (1)  THE RATE OF INTEREST ON POLICY LOANS PERMITTED
UNDER THIS SECTION INCLUDES THE INTEREST RATE CHARGE ON
REINSTATEMENT OF POLICY LOANS FOR THE PERIOD DURING AND AFTER ANY
LAPSE OF A POLICY. (2)  THE TERM "POLICY LOAN" INCLUDES ANY PREMIUM LOAN
MADE UNDER A POLICY TO PAY ONE OR MORE PREMIUMS THAT WERE NOT
PAID TO THE LIFE INSURER AS THEY FELL DUE. (3)  THE TERM "POLICYHOLDER" INCLUDES THE OWNER OF THE
POLICY OR THE PERSON DESIGNATED TO PAY PREMIUMS AS SHOWN ON THE
RECORDS OF THE LIFE INSURER. (4)  THE TERM "POLICY" INCLUDES CERTIFICATES ISSUED
BY A FRATERNAL BENEFIT SOCIETY AND ANNUITY CONTRACTS WHICH
PROVIDE FOR POLICY LOANS. (K) OTHER PROVISIONS OF LAW MAY NOT APPLY TO POLICY LOAN
INTEREST RATES UNLESS MADE SPECIFICALLY APPLICABLE TO THESE
RATES. (L) UPON REQUEST, A LIFE INSURER SHALL ANNUALLY NOTIFY THE
POLICYHOLDER OF THE CASH VALUE OF THE POLICY FOR THE CURRENT
POLICY YEAR. (M) ANY INSURER OFFERING INSURANCE POLICIES WITH AN
ADJUSTABLE POLICY LOAN INTEREST RATE SHALL ESTABLISH A WRITTEN
PRICING OR DIVIDEND POLICY PROVIDING THAT THE HOLDERS OF THE
POLICIES SHALL RECEIVE THE BENEFITS FROM ANY INCREASED EARNINGS


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Session Laws, 1983
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