§ 27-4.3-3 - Computation of cash surrender value. - Rhode Island Statutes

SECTION 27-4.3-3

   § 27-4.3-3  Computation of cash surrendervalue. – (a) Any cash surrender value available under the policy in the event of defaultin a premium payment due on any policy anniversary, whether or not required by§ 27-4.3-2, shall be an amount not less than the excess, if any, of thepresent value, on the anniversary, of the future guaranteed benefits whichcould have been provided for by the policy, including any existing paid upadditions, if there had been no default, over the sum of:

   (1) The then present value of the adjusted premiums asdefined in § 27-4.3-5, corresponding to premiums which would have fallendue on and after the anniversary; and

   (2) The amount of any indebtedness to the insurance companyon the policy.

   (b) For any policy issued on or after January 1, 1994, whichprovides supplemental life insurance or annuity benefits at the option of theinsured and for an identifiable additional premium by rider or supplementalpolicy provision, the cash surrender value referred to in subsection (a) shallbe an amount not less than the sum of the cash surrender value as defined insubsection (a) for a similar policy issued at the same age without the rider orsupplemental policy provision and the cash surrender value as defined insubsection (a) for a policy which provides only the benefits provided by therider or supplemental policy provision.

   (c) For any family policy issued on or after January 1, 1994,which defines a primary insured and provides term insurance on the life of thespouse of the primary insured expiring before the spouse's attaining ageseventy-one (71), the cash surrender value referred to in subsection (a) ofthis section shall be an amount not less than the sum of the cash surrendervalue as defined in subsection (a) for a similar policy issued at the same agewithout the term insurance on the life of the spouse and the cash surrendervalue as defined in subsection (a) for a policy which provides only thebenefits provided by the term insurance on the life of the spouse.

   (d) Any cash surrender value available within thirty (30)days after any policy anniversary under any policy paid up by completion of allpremium payments or any policy continued under any paid up nonforfeiturebenefit, whether or not required by § 27-4.3-2, shall be an amount notless than the present value, on the anniversary, of the future guaranteedbenefits provided for by the policy, including any existing paid-up additions,decreased by any indebtedness to the insurance company on the policy.