Virginia Code 38.2-3307: Participation in surplus.
A. Each participating individual life insurance policy shall contain a provision that the policy shall participate in the surplus of the insurer. Any policy containing a provision for participation at the end of the first policy year, and annually thereafter, may also provide that each dividend shall be paid subject to the payment of the premiums for the next ensuing year. The policyowner under any annual dividend policy shall have the right each year to have the dividend arising from the participation paid in cash. If the policy provides other dividend options, it shall also state which of the options shall be effective if the insured does not elect any option on or before the expiration of the grace period allowed for the payment of the premium.
Terms Used In Virginia Code 38.2-3307
- Grace period: The number of days you'll have to pay your bill for purchases in full without triggering a finance charge. Source: Federal Reserve
- Insurer: means an insurance company. See Virginia Code 38.2-100
- Life insurance: includes policies that also provide (i) endowment benefits; (ii) additional benefits incidental to a loss in the event of death, dismemberment, or loss by accident or accidental means; (iii) additional benefits to safeguard the contract from lapse or to provide a special surrender value, a special benefit or an annuity, in the event of total and permanent disability of the insured; and (iv) optional modes of settlement of proceeds. See Virginia Code 38.2-102
- policy: includes annuity contracts that provide for policy loans and certificates issued by a fraternal benefit society. See Virginia Code 38.2-3300
- State: means any commonwealth, state, territory, district or insular possession of the United States. See Virginia Code 38.2-100
B. This section shall not apply to any form of paid-up insurance, temporary insurance, or pure endowment insurance, issued or granted in exchange for lapsed or surrendered policies.
Code 1950, § 38-371 (5); 1950, p. 180; 1952, c. 317, § 38.1-396; 1986, c. 562.