California Insurance Code

§ 10295.7

INS § 10295.7 Effective Jan 1, 2014Div. 2 · Part 2 · Ch. 4 · Art. 2.1

Statute text

(a)The insurer may require a premium charge or cost of insurance charge for the accelerated death benefit. This charge shall be based on sound actuarial principles. In the case of group insurance, the additional cost may also be reflected in the experience rating.

(b)(1) The insurer may pay a present value of the face amount. The calculation shall be based on any applicable actuarial discount appropriate to the policy design. The interest rate or interest rate methodology used in the calculation shall be based on sound actuarial principles and disclosed in the contract or actuarial memorandum required in Section 10295.4. The maximum interest rate used shall be no greater than the greater of one of the following:

(A)The current yield on 90-day treasury bills.

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Legislative history

Added by Stats. 2013, Ch. 345, Sec. 7. (SB 281) Effective January 1, 2014.