PARRIS N. GLENDENING, Governor                          H.B. 1022

5. contracts of term insurance of uniform amount of 15 years or
less that expire before age 66.

(b)     (1) (i) After premiums have been paid for 3 full years, or for. a lesser
period as provided by the contract, the value of each paid-up nonforfeiture benefit and
the amount of any cash surrender value, loan, or other option granted by a certificate may
not be less than any excess of:

1.       the reserve under the certificate, determined on the basis
specified in the certificate; minus

2.       the sum of any indebtedness to the society on the certificate,
including interest due and accrued, and a surrender charge equal to 2.5% of the face
amount of the certificate.

(ii) For insurance on the lives of children, the face amount of the
certificate is the ultimate face amount of the certificate if death benefits provided in the
certificate are graded.

(iii) Subparagraph (i) of this paragraph does not apply to certificates
for which reserves are computed on:

1. the Commissioners 1941 Standard Ordinary Mortality Table;

'2. the 1941 Standard Industrial Table;

3.       the Commissioners 1958 Standard Ordinary Mortality Table;
or

4.       any mortality table that is authorized for use under §
5-304(b) of this article for policies issued on or after the operative date of § 15-309 [48A
§ 414(k-1)] of this article.

(2) The term of any extended insurance benefit granted, including any
accompanying pure endowment, may be computed on the rates of mortality not greater
than 130% of those shown by the mortality table specified in the certificate for the
computation of the reserve, if:

(i) the certificate is issued on a substandard basis; or

(ii) the reserves for the certificate are computed on the American Men
Ultimate Table of Mortality.

(c)     (1) Each paid-up nonforfeiture benefit, and the amount of any cash
surrender value, loan, or other option granted under a certificate may not be less than the
corresponding amount ascertained under the laws of the State that apply to life insurers
issuing policies containing like insurance benefits based on the same tables.

(2) This subsection applies to certificates for which reserves are computed
on:

(i) the Commissioners 1941 Standard Ordinary Mortality Table;

(ii) the Commissioners 1941 Standard Industrial Table;

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