- 44 -
$1,261.15) x 4.5% = $1,261.15)). Of the conversion credit
balance, $13,911.15 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 second year
($29,286.63 x 47.5%).
The third-year premium, before any experience refund, was
$18,186. The policy was credited with an experience refund of
$401.32, and the Lakewood Plan paid the net premium of $17,784.68
($18,186 - $401.32). The cost of insuring Dr. McManus for the
third year was $4,433.46, and, at the end of that year, the
conversion credit balance was $44,975.93 ($29,286.63 + $18,186 -
$4,433.46 + $1,936.76); the $1,936.76 is the interest of 4.5
percent earned on the conversion credit balance (($44,975.93 -
$1,936.76) x 4.5% = $1,936.76)). Of the conversion credit
balance, $40,590.78 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 third year ($44,975.93
x 90.25%).
The Lakewood Plan continued to pay the premiums on this
policy, net of the applicable experience refund, through 1996.
Effective October 1, 1996, Dr. McManus converted this policy to a
fully paid, individually owned C-group conversion UL policy in
the face amount of $187,827. At the time of conversion, the C-
group term policy’s conversion credit balance was $78,672.63, and
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