Maryland § 16-406
Full text of Maryland Maryland Code § 16-406, with citation guidance and answers to common questions.
§ 16-406.
(a) (1) Each participating annuity contract and each participating pure endowment contract shall contain a provision that:
(i) each year the insurer shall determine and apportion any divisible surplus under the contract that will accrue on the contract anniversary or other dividend date specified in the contract; and
(ii) the dividends arising from the apportionment shall be credited each year beginning not later than the end of the third contract year.
(2) The payment of any dividend payable on or after the end of the third contract year may not be made contingent on the payment of any consideration due on or after the date when the dividend becomes payable.
(b) (1) Each contract shall contain a provision that the party entitled to the dividend may elect to have the dividend paid in cash or applied to the payment of any consideration then due.
(2) Each contract shall contain a provision that a specified option becomes effective unless the party entitled to the dividend notifies the insurer in writing of election of a different option within 30 days after the date on which the dividend is payable.
(c) A deferred annuity contract need not provide for participation in surplus after annuity payments begin.
(d) This section does not prohibit an insurer from granting to the party entitled to the dividend the right to elect another dividend option offered by the insurer in addition to the options required by this section, whether or not the additional option is specified in the contract.
Frequently Asked Questions About Maryland § 16-406
What does Maryland Code § 16-406 cover?
Section 16-406 is part of the Maryland Code, the codified statutory law of Maryland. It sets out the legal rule or procedure described in the text above. Statutes are amended regularly, so always verify against the official source.
How do I cite Maryland § 16-406?
A common citation format is "Maryland Code § 16-406" (Maryland). Legal writing may require the code abbreviation, section number, and year or edition. Match the style required by your court, professor, or publisher.
Is this the official text of Maryland law?
No. This page is for research and education and may not include the most recent amendments. For official current law, check the Maryland official source linked on this page or consult a licensed Maryland attorney.
How does Maryland § 16-406 apply to my situation?
Statutes are interpreted in context, and application depends on your specific facts. Only a licensed attorney in Maryland can advise on how this section applies to you. Contact your state or local bar association for a referral.
Sources & Verification
Not legal advice. Verify against the official source and consult a licensed attorney in Maryland.