HARRY HUGHES, Governor

653

Standard Nonforfeiture Law), except as otherwise provided in
paragraphs (a-2) and (a-3) of this subsection for group annuity
and pure endowment contracts issued prior to the operative date.

(b-1) Except as otherwise provided in paragraphs
(b-2) and (e), reserves according to the commissioners reserve
valuation method, for the life and endowment insurance benefits
of policies providing for a uniform amount of insurance and
requiring the payment of uniform premiums, shall be the excess,
if any, of the present value, at the date of valuation, of such
future guaranteed benefits provided for by such policies, over
the then present value of any future modified net premiums
therefor. The modified net premiums for any such policy shall be
such uniform percentage of the respective contract premiums for
such benefits that the present value, at the date of issue of the
policy, of all such modified net premiums shall be equal to the
sum of the then present value of such benefits provided for by
the policy and the excess of (A) over (B), as follows:

(A)  A net level annual premium equal to the
present value, at the date of issue, of such benefits provided
for after the first policy year, divided by the present value, at
the date of issue, of an annuity of one per annum payable on the
first and each subsequent anniversary of such policy on which a
premium falls due; provided, however, that such net level annual
premium shall not exceed the net level annual premium on the
nineteen year premium whole life plan for insurance of the same
amount at an age one year higher than the age at issue of such
policy.

(B)  A net one year term premium for such
benefits provided for in the first policy year.

Provided that for any life insurance policy issued on or
after January 1, 1986 for which the contract premium in the first
policy year exceeds that of the second year and for which no
comparable additional benefit is provided in the first year for
the excess premium, and which provides an endowment benefit or a
cash surrender value, or a combination, in an amount greater than
the excess premium, the reserve according to the [Commissioner's]
COMMISSIONERS reserve valuation method as of any policy
anniversary occurring on or before the assumed ending date
defined as the first policy anniversary on which the sum of any
endowment benefit and any cash surrender value then available is
greater than the excess premium shall, except as otherwise
provided in subsection (e), be the greater of the reserve as of
the policy anniversary calculated as described in the preceding
paragraph or the reserve as of such policy anniversary calculated
as described in that paragraph, but with (i) the amount defined
in subparagraph (a) of that paragraph being reduced by 15 percent
of the amount of the excess first year premium, (ii) all present
values of benefits and premiums being determined without
reference to premiums or benefits provided for by the policy
after the assumed ending date, (iii) the policy being assumed to
mature on that date as an endowment, and (iv) the cash surrender