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equaled the amount referenced in Commonwealth’s table of
conversion credit values for the following variables: (1)
Business issued before February 1, 1993, (2) male, (3) issue age
46, (4) duration of 5 years, and (5) $150,000 death benefit.
6. Dr. Sobo’s $150,000 Commonwealth C-Group Term Policy
Effective October 31, 1991, Commonwealth issued a $150,000
C-group term policy (certificate No. 6000971) on the life of Dr.
Sobo, age 38. The first-year premium was $1,620, and the cost of
insuring Dr. Sobo for that year was $356.11. The Lakewood Plan
paid the first-year premium, and, at the end of that year, the
conversion credit balance was $1,320.76 ($1,620 - $356.11 +
$56.87); the $56.87 is the interest of 4.5 percent earned on the
conversion credit balance (($1,320.76 - $56.87) x 4.5% =
$56.87)). None of the conversion credit balance could have been
transferred at this time to the C-group conversion UL policy,
upon conversion thereto, because the C-group term policy was in
its first year.
The second-year premium, before any experience refund, was
$1,638. The policy was credited with an experience refund of
$24.48, and the Lakewood Plan paid the net premium of $1,613.52
($1,638 - $24.48). The cost of insuring Dr. Sobo for the second
year was $370.54.
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