RS 22:961 Group annuity contracts; definition; standard provisions
SUBPART E. GROUP ANNUITIES
§961. Group annuity contracts; definition; standard provisions
Any policy or contract, except a joint, reversionary or survivorship annuity contract, whereby annuities are payable dependent upon the continuation of the lives of more than one person, shall be deemed a group annuity contract. The person, firm or corporation to whom such contract is issued shall be deemed the "holder" of such contract. The term "annuitant," as used herein, refers to any person upon whose continued life such annuity is dependent.
No group annuity contract shall be delivered or issued for delivery in this state and no certificate shall be used in connection therewith unless it contains in substance the following provisions to the extent that such provisions are applicable to such contract or to such certificate, as the case may be, or provisions which in the opinion of the commissioner of insurance are more favorable to annuitants, or not less favorable to annuitants and more favorable to the holders:
(1) A provision in such contract that there shall be a period of grace, either of thirty days or of one month, within which any stipulated payment to be remitted by the holder to the insurer, falling due after one year from date of issue, may be made, subject, at the option of the insurer, to an interest charge thereon at a rate, to be specified in the contract, which shall not exceed six per cent per annum for the number of days of grace elapsing before such payment.
(2) A provision in such contract specifying the document or documents which shall constitute the entire contract between the parties; the document or documents so specified shall be only (a) the contract, (b) the contract together with the application of the holder of which a copy is attached thereto, or (c) the contract together with the application of the holder of which a copy is attached thereto and the individual applications of annuitants on file with the insurer and referred to therein.
(3) A provision in such contract, with an appropriate reference thereto in the certificate, for the equitable adjustment of the benefits payable under the contract or of the stipulated payments thereunder, if it be found that the sex, age, service, salary or any other fact determining the amount of any stipulated payment or the amount or date or dates of payment of any benefit with respect to any annuitant covered thereby, has been misstated.
(4) A provision or provisions in such contract, with an appropriate reference thereto in the certificate, specifying the nature and basis of ascertainment of the benefits which will be available to an annuitant who contributes to the cost of the annuity and the conditions of payment thereof in the event of either the termination of employment of the annuitant, except by death, or the discontinuance of stipulated payments under the contract. Such provision or provisions shall, in either of such events, make available to an annuitant who contributes to the cost of the annuity a paid-up annuity payable commencing at a fixed date in an amount at least equal to that purchased by the contributions of the annuitant, determinable as of the respective dates of payment of the several contributions, as shown by a schedule included in the contract for that purpose, based upon the same mortality table, rate of interest and loading formula used in computing the stipulated payments under such contract. Such provision or provisions may, by way of exception to the foregoing, provide that if the amount of the annuity determined as aforesaid from such fixed commencement date would be less than sixty dollars annually, the insurer may at its option, in lieu of granting such paid-up annuity, pay a cash surrender value at least equal to that hereinafter provided. If a cash surrender value, in lieu of such paid-up annuity, is allowed to the annuitant by the terms of such contract, it may be either in a single sum or in equal installments over a period of not more than twelve months and it shall be at least equal to either (a) or (b), whichever is less: (a) the amount of reserve attributable to the annuitant's contributions less a surrender charge not exceeding thirty-five per centum of the average annual contribution made by the annuitant; or (b) the amount which would be payable as a death benefit at the date of surrender. Such contract shall also provide that in case of the death of the annuitant, before the commencement date of the annuity, the insurer shall pay a death benefit at least equal to the aggregate amount of the annuitant's contributions, without interest. If any benefits are available to the holder in either of such events the contract shall contain a provision or provisions specifying the nature and basis of ascertainment of such benefits.
(5) A provision in such contract that the insurer will issue to the holder of the contract for delivery to each annuitant who contributes thereunder an individual certificate setting forth a statement in substance of the benefits to which he is entitled under such contract.
Acts 1958, No. 125; Redesignated from R.S. 22:174 by Acts 2008, No. 415, §1, eff. Jan. 1, 2009.