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Lakewood continued to pay the premiums on this policy, net
of the applicable experience refund, through 1996. Effective
February 15, 1996, Dr. Desai converted this policy to a fully
paid, individually owned C-group conversion UL policy in the face
amount of $106,353. At the time of conversion, the C-group term
policy’s conversion credit balance was $58,141.90, and $55,234.80
of that amount ($58,141.90 x 95%) was transferred to the C-group
conversion UL policy for potential earning. Dr. Desai will earn
these credits in 120 equal monthly installments, beginning
February 1996. The conversion credit balance of $55,234.80
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 3 years 6 months, and (5) $1,005,000 death
benefit.
2. Dr. Hirshkowitz’ Peoples Security C-Group Term Policy
Effective August 15, 1992, Peoples Security issued a
$940,000 C-group term policy (certificate No. 7002550) on the
life of Dr. Hirshkowitz, age 59. The first-year premium was
$48,861.20, and the cost of insuring Dr. Hirshkowitz for that
year was $10,907.54. Lakewood paid this premium, and, at the end
of that year, the conversion credit balance was $39,661.57
($48,861.20 - $10,907.54 + $1,707.91); the $1,707.91 is the
interest of 4.5 percent earned on the conversion credit balance
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