Naic: Model Policy Loan Interest Rate Bill National Association Of Insurance Commissioners
Definition of "Naic: model policy loan interest rate bill national association of insurance commissioners"
Bill that allows the insurance company to include a clause in its policy that permits the policyholder to make a policy loan at a variable interest rate on new policies. Under this clause, the following must be instituted by the insurance company: interest rate cannot be changed more than four times each year; at least once each year, an evaluation must be made of the requirement for any change in the interest rate; interest rate cannot be changed to that of a rate higher than Moody's Composite Yield on seasoned corporate bonds, which is in effect two months prior to the establishment of the new rate or to a rate higher than the interest rate being credited to the cash value plus 1%. The rate change calculation that is utilized is the decision of the insurance company. No change in the interest rate can be made unless the adjustment is for an increase of at least one-half of 1 %. Should the interest rate charged on policy loans currently decrease to an amount at least equal to one-half of 1% of that rate currently being charged, then the variable loan rate must be lowered in turn. There remains no requirement for the insurance company to actually increase the interest rate or to use a variable interest rate; the sole use of fixed interest rates is still permissible.
Popular Insurance Terms
Process in life insurance by which an applicant who is uninsurable, or is a greater than average risk, seeks to obtain a policy from a company at a standard premium rate. Life insurance ...
Holding of property, or otherwise acting on behalf of another in trust. The fiduciary must exercise due care in safeguarding property left under personal care, custody, and control. ...
Benefits provided to and obtained by those insured, while still alive. They include the annuity, cash surrender value, disability income, policy loan, and waiver of premium (WP). ...
Conveying of assets from the donor to the beneficiary as a means of minimizing the legal tax obligation of the estate of the donor and avoiding probate. ...
Rate charged by the Federal Reserve to commercial banks for overnight loans made by these banks. If the Federal Reserve decreases the discount rate, other rates will decline as well. ...
Professional designation earned after the successful completion of four national examinations given by the insurance institute of America (IIA). Covers such areas of expertise as principles ...
Derivative representing a legal obligation to carry out a transaction that has been prearranged according to a stipulated price and date in the future. There are numerous types of financial ...
Coverage if a lawyer's professional act (or omission) results in the client inflicting bodily injury or property damage to another party, or if personal injury and/or property damage is ...
Automatic adjustment applied to Social Security retirement payments when the consumer price index increases at a rate of at least 3%, the first quarter of one year to the first quarter of ...
Have a question or comment?
We're here to help.