§ 38.2-3141. Reserve calculation - Valuation net premium exceeding the gross premium charge
A. If in any contract year the gross premium charged by a life insurer on any policy or contract is less than the valuation net premium for the policy or contract calculated by the method used in calculating the reserve on the policy or contract but using the minimum valuation standards of mortality and rate of interest, the minimum reserve required for the policy or contract shall be the greater of either the reserve calculated according to the mortality table, rate of interest, and method actually used for the policy or contract, or the reserve calculated by the method actually used for the policy or contract but using the minimum valuation standards of mortality and rate of interest and replacing the valuation net premium by the actual gross premium in each contract year for which the valuation net premium exceeds the actual gross premium. The minimum valuation standards of mortality and rate of interest referred to in this section are those standards stated in §§ 38.2-3130 through 38.2-3136.
B. For any life insurance policy issued on or after January 1, 1986, for which the gross premium in the first policy year exceeds that of the second year and for which no comparable additional benefit is provided in the first year for that excess and which provides an endowment benefit or a cash surrender value or a combination of both in an amount greater than the excess premium, the provisions of this section shall be applied as if the method actually used in calculating the reserve for the policy were the method described in § 38.2-3137, ignoring subsection B of § 38.2-3137. The minimum reserve at each policy anniversary of such a policy shall be the greater of the minimum reserve calculated in accordance with § 38.2-3137, and the minimum reserve calculated in accordance with this section.
(Code 1950, § 38-394; 1952, c. 317, § 38.1-456; 1959, Ex. Sess., c. 43; 1962, c. 562; 1975, c. 215; 1979, c. 437; 1982, c. 227; 1986, c. 562.)
Sections: Previous 38.2-3130 38.2-3131 38.2-3132 38.2-3133 38.2-3134 38.2-3135 38.2-3136 38.2-3137 38.2-3138 38.2-3139 38.2-3140 38.2-3141 38.2-3142 38.2-3143 38.2-3144 NextLast modified: April 16, 2009