Life Missouri statutes, rules, and regulations

policy rates and forms

All life insurance policies and annuity contracts delivered or issued in this state must be filed with and approved by the Director prior to use -Director has 45 days to approve or disapprove a policy or contract after the filing

variable products

All variable life insurance policies and other documents attached to the policy must be approved by the Director Must comply with the following requirements: -Mortality and expense risks will be carried by the insurer -For scheduled premium policies a minimum death benefit will be provided in an amount at least equal to the initial face amount of the policy -The policy must reflect the investment experience of one or more separate accounts maintained by the insurer -Each variable life insurance policy must be credited with the full amount of the net investment return applied to the benefit base -Any changes in variable death benefits will be determined at least annually -The cash value of each variable life insurance policy will be determined at least monthly -The computation of values required for each variable life insurance policy may be based on reasonable and necessary approximations that are acceptable to the Director

annuity training

Insurance producers engaging in the sale of annuity products must complete a one-time 4-hour training course approved by the Director

suicide exclusion

Life insurance policies in Missouri may exclude or restrict liability of death as a result of suicide if the suicide was committed within 1 year from the date of the policy issue -Insurer is responsible for prompt refund of paid premiums

representations

indicating that all statement made by the insured are considered representations and not warranties

advertising

-All advertisements are the responsibility of the insurer and the producer who created and presented the advertisement -Enrollment period for life insurance may not be advertised unless there has been a lapse of no less than 3 months between the close of the preceding enrollment period and the opening of a new enrollment period -Advertisements must specify the date in which an applicant must submit an application, not less than 10 days or more than 40 days of the enrollment period advertised

variable contract qualifications

-Be licensed to transact insurance in this state and are in good standing -Have and maintain capital and/or surplus of at least $2,500,000

variable reports and examinations

-Companies that issue individual variable contracts are required to mail the contract holder a statement reporting the investments held in the separate account at least annually -Must also submit an annual statement of the business of its separate account to the Director

replacing producer duties

-Present to the applicant a Notice Regarding Replacement that is signed by both the applicant and the producer. A copy must be left with the applicant -Obtain a list of all existing life insurance and/or annuity policies to be replaced including policy numbers and the names of all companies being replaced -Leave the applicant with the original or a copy of written or printed communications used for presentation to the applicant -Submit to the replacing insurance company a copy of the replacement notice with the application

replacing insurance company duties

-Require from the producer a list of the applicant's life insurance or annuity contracts to be replaced and a copy of the replacement notice provided to the applicant -Send each existing insurance company a written communication advising of the proposed replacement within a specified period of time of the date that the application is received in the replacing insurance company's home or regional office. A policy summary or ledger statement containing policy data on the proposed life insurance or annuity must be included -Conservation

credit life insurance policy term limits

-Term takes effect on the date the debtor becomes obligated to creditor -Evidence of insurance must be provided to the insurer within 30 days after the insurance term begins -director will approve or deny within 65 days

group insurance required provisions

-entire contract -representations -evidence of insurability -certificate of insurance

universal life mandatory provisions

-periodic disclosure to policyowner -current illustrations -policy guarantees -calculation of cash surrender value -changes in basic coverage -grace period and lapse -misstatement of age and sex -maturity date

policy provisions

-policy loan rates -assignability -suicide exclusion -war and aviation exclusion

replacement forms

Each producer who initiates the application must submit the following to the insurance company with or as part of each application: -A statement signed by the applicant as to whether replacement of existing life insurance or annuity is involved in the transaction -A signed statement as whether the producer knows the replacement is or may be involved in the transaction

war and aviation exclusion

Life insurance policies must include a notice of any war or aviation exclusions -Must be prominently displayed in the face of the policy and clearly name and explain the exclusions contained in the policy

calculation of cash values

Policies must contain at least a general description of the calculation of cash surrender values

policy loan rates

State regulations on the maximum interest rate on policy loans are as follows: -Policy loan interest rates may not exceed 8% per year -Life insurers are allowed to establish an adjustable maximum rate which may not exceed the higher of the Published Monthly Average for the calendar month 2 months prior to the date on which the rate is determined, or the rate used to compute the cash surrender values under the policy plus annual 1% -The maximum rate for each policy must be determined at regular intervals at least once a year, but not more frequently than once every 3 months

group insurance grace period

States that policyholders are entitled to a grace period of 31 days for the payment of any premium except the first -Policy will continue in force, but the insurer may require the payment of a pro rata premium during the grace period

assignability

States that the insured under a group life policy may assign any incidents of ownership under the policy, such as the right to designate a beneficiary, to have an individual policy, and to pay premiums

variable suitability

The applicant's insurance and investment objectives, financial situation and needs must be considered when making recommendations for purchased variable contracts

annuity suitability

To ensure annuity suitability, producers must make a reasonable effort to obtain relevant information from the consumer and evaluate the following factors: -Age -Annual income -Tax status -Financial needs and timeline -Investment objectives -Liquidity needs and liquid net worth -Existing assets -Intended use of annuity -Financial experience Risk tolerance

incontestability

Validity of the policy may not be contested after policy has been in force for 2 years unless for nonpayment of premium or fraudulent misstatements by the applicant or insured

universal life grace period

a written notice of the termination of coverage must be sent to the policyowner at least 30 days prior to the termination. After policy lapse, a grace period of at least 30 days must be provided

pro rata premium

an adjustment of the premium charge in proportion to the exact coverage that has been in force -proportional

conservation

any attempt by the existing insurer or its producers, or by any broker to dissuade a current policyowner from the replacement of existing life insurance or annuity -Does not include routine administrative procedures

policy replacement

any transaction in which new life insurance or new annuity is purchased and, as a result, the existing life insurance or annuity has been or will be any of the following: -Lapsed, forfeited, surrendered, or otherwise terminated -Reissued with any reduction in cash value -Converted to reduced paid up insurance, continued as extended term insurance or otherwise reduced in value by the use of nonforfeiture benefits or other policy values -Amended so as to affect either a reduction in benefits or in the term for which coverage would otherwise remain in force or for which benefits would be paid -Used in a financed purchase

periodic disclosure to policyowner

at least once a year, the policyowner must receive, without any additional charge, a policy status report for the period ending no earlier than 3 months prior to the report mailing date

policy guarantees

policies must provide guarantees of minimum interest credits and maximum mortality and expense charges. Figures based on nonguarantees cannot be included in the policy

changes in basic coverage

policies must state if the policyowners have the right to change the basic coverage

graded death benefits

policy intended to be used for substandard risks -Death benefit increased over time and is issued with little or no underwriting -Guaranteed issue basis -Must comply with age restrictions for grading the death benefit

misstatement of age and sex

provision must stipulate that the death benefit will be adjusted to the amount that would have been purchased in accordance with the most recent mortality charge at the correct age or sex

evidence of insurability

setting forth conditions under which the insurer reserves the right to require evidence of individual insurability

credit life insurance

special type of coverage written to insure the life of the debtor and pay of the balance of a loan in the event of the death of the debtor -Usually written as decreasing term insurance -May be written as individual or group policy -Creditor is owner of master policy and each debtor receives a certificate of insurance -Creditor is also beneficiary -Cannot pay out more than the balance of the debt -Premiums paid by the debtor

entire contract

stating that a copy of the application must be attached to the policy

certificate of insurance

stating the insurer will issue the policyholder for delivery to each individual insured a certificate specifying the insurance protection

current illustrations

the annual report must include notice that the policyholder has the right to request an illustration of current and future benefits and values

replacing insurer

the company that issues the new policy

existing insurer

the company whose policy is being replaced

maturity date

whenever a policy provides a maturity or end date, it must contain a statement that it is possible that coverage may not continue to the maturity date even if scheduled premiums are paid in a timely manner