Oklahoma § 36-1216 - Prohibitions and regulations concerning use of certain

§ 36-1216. Prohibitions and regulations concerning use of certain

types of policy forms, policy provisions and annuity contracts.

In accordance with the purpose expressed in Section 1 of this

act, the use of certain types of policy forms, policy provisions and

annuity contracts shall be subject to the following prohibitions and

regulations:

1. No life insurance policy or annuity contract containing a

series of guaranteed annual endowment benefits evidenced by coupons,

passbooks or similar devices generally identified with investment or

banking operations shall be approved for use, and no such policy or

contract heretofore approved shall be issued or delivered in this

state after January 15, 1974;

2. No life insurance policy or annuity contract containing a

series of guaranteed annual endowment benefits shall be approved for

use and no such policy or contract heretofore approved shall be

issued or delivered in this state after January 15, 1974, unless the

following requirements are satisfied:

a. the gross premium for the guaranteed annual

endowment benefit shall be shown conspicuously and separately in the

Oklahoma Statutes - Title 36. Insurance

policy, distinct from the gross premium for the life insurance

benefits and, unless the gross premium is so prominently and

separately shown on the schedule of benefits and premiums page in

the policy, the language shall be sub stantially in the following

form: "The premium shown includes an additional (annual, semiannual,

quarterly, monthly, etc.) premium of $_____ for endowment benefits,"

b. the insured shall be entitled to withdraw the

guaranteed annual endowment benefits not less frequently than at the

end of each policy year. The number of one-year guaranteed

endowment benefits shall equal the number of annual premiums for

such benefits unless the insurance contract clearly and distinctly

provides otherwise,

c. payment of any guaranteed annual endowment

benefits shall not be made contingent on the payment of premiums

falling due on or after the time the guaranteed annual endowment

benefit has matured,

d. the separately stated gross premium for the

series of guaranteed annual endowment benefits shall be based on

reasonable assumptions, consistent with the basic policy form as to

interest, mortality and expense,

e. the guaranteed annual endowment benefit shall be

expressed in dollars, both in the policy and in any sales or

advertising material relating thereto, and not as a percentage of

any premium or benefit,

f. no guaranteed annual endowment benefit shall be

described, either in the policy or in any sales or advertising

material, as anything other than a guaranteed benefit for which a

premium is being paid by the policyholder, and

g. at the time the policy form is filed with the

Insurance Department for approval, said policy form shall be

accompanied by all sales, advertising or other material which the

insurer proposes to use in connection with the sale of such policy;

such sales, advertising or other material shall be approved by the

State Insurance Commissioner.

Nothing in this subsection shall apply to any policy in which the

amount of any endowment or periodic benefit or benefits payable

during any policy year is greater than the total annual premium for

such year;

3. No coupon policy shall be approved or issued in this state

after the effective date of this act, nor shall any coupon policy

heretofore approved be issued or delivered in this state after

January 15, 1974;

4. No profit-sharing policy shall be approved for use in this

state after the effective date of this act, nor shall any profitsharing policy heretofore approved be issued or delivered in this

state after January 15, 1974. Nothing contained in this section

Oklahoma Statutes - Title 36. Insurance

shall apply to variable annuity contracts to the extent that such

are permitted under the laws of this state.

This subsection shall not be construed to restrict or prohibit

the sale in this state of any participating life insurance policy

where the dividend or abatement of premium is derived solely from

the profits of that class of participating business;

5. No charter, founders or coupon policy or policy with a name

of similar connotation shall be approved for use in this state after

the effective date of this act and no charter, founders or coupon

policy or policy with a name of similar connotation heretofore

approved shall be issued or delivered in this state after January

15, 1974; and

6. No annual endowment shall be described as being a

guaranteed dividend, nor as earnings on the premium investment.

Nothing in this section shall be construed to prohibit a

representation that a holder of a participating life insurance

policy or annuity contract will participate in the share of the

divisible surplus, if any, apportioned to the policy or contract by

the insurer.

Laws 1972, c. 223, § 3, operative Jan. 15, 1974.