M29-1, Part II

Advance Manual Change No. 13-84 November 30, 1984

[Chapter 36]{.underline} - [Conversions]{.underline}

A. [Change:]{.underline} M29-1, Part II, Chapter 36. This advance manual
change is\
issued in conjunction with Advance Manual Change No. 12-84 in\
M29-1, Part l, and clarifies procedures for determining\
effective dates for conversions. It also establishes new\
procedures to be followed when a conversion application is\
received either for an effective date more than four months in\
the future, or for an account on which monthly term premiums\
have not been paid through the premium month prior to the month\
in which the application is received.

B. [Procedure:]{.underline} 1. Page 36-2, delete subparagraph 36.02c, d,
and e, and

substitute the following:

c\. A conversion application may not be accepted if any of the following
conditions apply:

\(1\) The policy is lapsed, i.e., the premium due date of the next month
due is more than 61 days prior to the postmark date of the application.
Lapsed contracts may not be converted until reinstatement requirements
are met. However, a policy may be reinstated and converted at the same
time.

\(2\) The policy is not paid through the premium month prior to the
premium month in which the application is postmarked and the remittance
and/or premium credits are insufficient to pay the late premium.

\(3\) The application is for an endowment plan, and is either unsigned
or was postmarked or delivered to the VA more than 31 days after the
date of signature. In either case, a supplemental application should be
requested.

d\. If the insured fails to remit the initial premium, but all other
requirements are met, the application should be accepted.

e\. An unsigned application should be accepted, unless it is for an
endowment policy. However, if the unsigned application has a beneficiary
and option designation, the designation cannot be accepted. The insured
should be sent a VA Form 29-336, Designation of Beneficiary and Optional
Settlement, and advised that it must be completed, signed, dated and
returned in order for a change in beneficiary and/or option to be made.
Any beneficiary and option designation, whether it is received with an
application or independently, must be reviewed for acceptability as
outlined in paragraph 15.04 of this manual. 2.M29-1, Part II

Advance Manual Change No. 13-84

2\. Page 36-2, delete the note following subparagraph 36.O2f.

3\. Page 36-3, delete subparagraph 36.03a and substitute the following:

a\. On an antedated conversion, the reserve or difference in reserve may
be paid by a direct payment and/or, if the new policy is antedated one
or more years, by a loan on the new policy. The amount of reserve or
difference in reserve must be paid in full. No shortages will be
allowed.

4\. Pages 36-3 and 36-4, delete paragraph 36.04 and substitute the
following:

36.04 EFFECTIVE DATE

a\. The effective date of the permanent plan selected may be classified
as any one of the following:

\(1\) [Current Effective Date]{.underline} - The premium due date of the
premium month in which the application was submitted, or the

\- next following due date. A current effective date is used if no
specific effective date is requested by the insured.

\(2\) [Future Effective Date]{.underline} - The date any future premium
becomes due after the next following due date, but not later than the
12th premium due date following the date of application. Applications
with a requested conversion date of more than 120 days in advance will
be diaried to a point within 120 days of the requested date and held
pending along with any associated remittance. The insured will be
advised by letter of the status of the account and, if applicable, of
the advantage of converting with an earlier effective date to save age.
If the conversion is to be for an endowment plan, however, the effective
date cannot be more than 31 days from the date of signature.

\(3\) [Past Effective Date]{.underline} - The date any past premium
became due within any term period. Under the NSLI program it is not
permissible to antedate to a younger age in order to qualify for a
Modified Life plan of insurance. However, if an application is submitted
during the latter half of the insured\'s 60th year of age (Modified Life
at Age 65 - insurance age 61), or during the latter half of the
insured\'s 69th year of age (Modified Life at Age 70 - insurance age
70), and there is evidence that the application was belatedly submitted
because the insured found our instructions confusing, the • 3.

N29-1, Part II

Advance Manual Change No. 13-84

application will be accepted and the policy will be antedated to the
latest possible effective date. Under the USGLI program, it is not
permissible to antedate a conversion to an age younger than 65 when
converting to the Special Endowment at Age 96 plan.

5\. Page 36-4, delete paragraph 36.05 and substitute the following:

36.05 EFFECTIVE DATE OF CHANGE

a\. The effective date of change for past and current conversions should
be determined as follows:

\(1\) Use the premium due date of the premium paying month in which the
request for conversion was submitted, governed by the postmark date if
mailed, by the earliest VA receiving stamp date if otherwise delivered,
or by the date of execution if received through military channels, if:

• (a) The premium for that month has not been paid.

\(b\) The insured requests that the effective date of the permanent plan
be established as of the premium due date of the month in which the
application is submitted, even though the premium for that month has
been paid. In this event, allow credit for the unearned premium, if any,
on the amount of insurance converted.

\(c\) To save age.

\(2\) Use the premium due date of the next premium paying month, unless
otherwise requested by the insured, if:

\(a\) The premium for the month in which the request is submitted has
been paid.

\(b\) The method of payment is by allotment or DFB.

\(c\) Premiums on the term contract are being waived under disability
waiver provisions.

b\. If the insured requests that the permanent plan be effective as of a
premium due date which is later than the next premium due date, the
effective date of change should be the premium due date indicated by the
insured, provided the effective date requested is not later than the
12th premium due • 4.

M29-1, Part II

Advance Manual Change No. 13-84

after the postmark date of the application, and all other requirements
are met. If the effective date is to be later than the fourth premium
due date after the postmark date, the application will be held pending
until within 120 days of the effective date.

c\. If the insured requests a current effective date, but also specifies
a month in which allotment or DFB is to be established or increased, the
new allotment or DFB will be established as of the date requested. The
effective date and effective date of change will be the month following
the month in which the allotment or DFB is established, in order to keep
the premium payments one month in advance. This procedure will be
followed even if it results in the establishment of a future effective
date. For example, if the application was postmarked 2-21-84, and the
allotment or DFB was to be established or increased as of April 1984,
the conversion would be made effective May 1984. If, however, the
insured is converting to an endowment plan, and the requested allotment
or DFB effective month would cause the effective date of the policy to
be more than 31 days from the date of signature, the effective date of
conversion will be determined by the postmark date of the application.

6\. Page 36-5, delete subparagraph 36.06a and substitute the following:

a\. Generally, when an insured specifies a conversion date and it can be
reasonably interpreted that he/she desires a current conversion, rather
than an antedated or future conversion, the application will be
processed as a current conversion and given an effective date consistent
with the premium status of the term insurance. Further clarification
will not be requested of the insured. The following are examples of such
cases, using the first of the month as the due date:

\(1\) Application Mailed 11-14-84\
Requested Effective Date 12- 1-84\
Account Paid Through 10-31-84

The conversion should be granted with an effective date of 11-1-84,
since the 11-1-84 premium has not been paid.

\(2\) Application Mailed 11-28-84\
Requested Effective Date 10- 1-84\
Account Paid Through 9-30-84

• 5.

M29-1, Part II

Advance Manual Change No. 13-84

The conversion should be granted with an effective date of 11-1-84, and
the remittance accompanying the application used to pay the term premium
due 10-1-84. If no remittance is received and there is insufficient
credit to pay the 10-1-84 premium, the application will be disapproved.

\(3\) Application Mailed 11-14-84\
Requested Effective Date 12- 1-84\
Account Paid Through 11-30-84

Normally, this conversion would be effective as of 12-1-84. However, if
the insurable age would be lower as of 11-1-84, the effective date would
be 11-1-84.

7\. Page 36-6, delete subparagraph 36.O7b and c, and insert the
following:

b\. If the effective date selected is later than the fourth premium due
after the postmark date, but prior to the thirteenth, the application
will be held pending until within

• 120 days of the effective date.

c\. If the effective date selected for conversion of a Limited
Convertible Term policy (W) is on or after the first renewal date after
the insured1s 50th birthday, the policy should be converted as of the
day after the final day of term coverage.

d\. If the effective date selected is later than the twelfth premium due
date after the postmark date, the application will be disapproved and
the insured will be advised to reapply in the month before the requested
effective date.

C. New or Revised

[Insurance Forms]{.underline}: None

OBEY. CAREY

Assistant Director for Insurance

[DISTRIBUTION:]{.underline}

335/29 92\
310/290 51\
- 310/291 111\
310/Library 1\
203/SDA 2\
CO/311D 2

M29-1, Part ll

Advance Manual Change No. 11-83 December 6, 1983

[Chapter 36]{.underline} - [Conversions]{.underline}

A. [Change:]{.underline} M29-1, Part H, Chapter 36. This advance manual
change is issued in\
conjunction with advance manual changes 7-83 in M29-1, Part l and

12-83 in M29-1, Part II. It establishes new procedures for developing
and processing conversions of Five-Year Limited Convertible Term
insurance.

B. [Procedure]{.underline}: Page 36-i add: 36.20 Five-Year Limited
Convertible Term Insurance - Special Provisions . . . 36-13.

Page 36-1, paragraph 36.01, add the following sentence to sub- paragraph
f: Refer to paragraph 36.20 for special provisions concerning
conversions of Five-Year Limited Convertible Term insurance. Eliminate
subparagraph 36.0 1g and redesignate subparagraphs 36.01h, i, j and k as
g, h, i and j.

Page 36-13, add the following paragraph:

36.20 Five-Year Limited Convertible Term Insurance - Special Provisions

a\. Title 38 U.S.C. 723(b) provides that Five-Year Limited Convertible
Term insurance (\`1W\" prefix) may not be renewed after the insured\'s
50th birthday. The insured is notified one year prior to the termination
date that he or she must convert to one or more available permanent
plans before the expiration of the final term period after his or her
50th birthday if he or she wishes to retain insurance. A second notice
is sent 90 days prior to the termination date of the Five-Year Limited
Convertible Term insurance.

b\. Due to the special provisions governing renewal of Five-Year Limited
Convertible Term insurance, the conversion application must be carefully
reviewed by the Policy Service Technician to determine whether it is
timely filed. If it is determined that the application was made within
61 days from the termination date of the Five-Year Limited Convertible
Term insurance, it will be considered timely filed and processed without
special development. The application date will be the postmark date if
the application is mailed, the earliest VA receiving stamp date if it is
otherwise delivered, or the date of execution if it is received through
military channels.

2\.

c\. If the Policy Service Technician determines that the conversion
application was made more than 61 days from the termination date, the
insurance records will be obtained and forwarded to the Chief, Insurance
Operations Division (Philadelphia) or the Chief, Insurance Division (St.
Paul), as appropriate, for review. If the conversion was applied for
within 180 days from the termination date, a decision to extend the
conversion period may be made by the Division Chief based on the
evidence of record. If the conversion application was made more than 180
days after the termination date, and the Division Chief determines that
an extension of the conversion period may be justified, the insurance
records should be forwarded to the Chief, Insurance Program Management
Division, for consideration. A decision to extend the conversion period
may be made when the evidence of record indicates any of the following
factors:

\(1\) A recent B&O designation or correspondence indicating that the
insured intended to retain insurance,

\(2\) Misinformation or negligence by the VA,

\(3\) Conversion application filed in other records (e.g. military
records),

\(4\) Continuation of term insurance premium payments beyond the
termination date,

\(5\) Any other factor which under principles of equity and good
conscience would cause an extension of the application period.

d\. Since premium payments beyond the expiry date of the Five-Year
Limited Convertible Term insurance may be considered sufficient reason
to extend the conversion period, the Policy Service Technician should be
careful to refer all such cases to the Division Chief, regardless of
whether the insured has filed a conversion application.

e\. If a decision is made to extend the conversion period, the Policy
Service Technician will notify the insured that he or she has 31 days to
complete and return a VA Form 29-358, Application for Conversion, unless
a conversion application has already been filed. The Policy Service
Technician will also notify the insured that he or she must remit a
payment sufficient to cover premiums from the effective date of the new
policy (the day after the expiry date of the Five-Year Limited
Convertible Term policy) through the current premium month. Any premiums
paid and accepted after the expiry of the Five-Year Limited Convertible
Term policy will be applied toward the new policy to determine the
amount of premiums due.

3\.

f\. If a decision is made to disapprove the conversion application, the
Policy Service Technician will notify the insured in writing that the
application has been disapproved and that any evidence which would
support a different decision should be submitted for consideration. Any
unearned premiums retained by the VA will be refunded to the insured at
this time.

g\. If premium payments for the Five-Year Limited Convertible Term
insurance are being waived due to the insured ?5 total disability on the
final termination date, the insurance will not be terminated for failure
to file a timely conversion application. The Policy Service Technician
will review the records to determine whether the conversion applications
were sent to the insured. If the notifications were sent and no reply
has been received, the Five-Year Limited Convertible Term insurance will
be converted to Ordinary Life and no further action will be taken. If
the 90 day notification was not sent, the policy will be converted to
Ordinary Life, and the insured will be notified of our action and
allowed 31 days to advise us if he or she wants conversion to one or
more of the other available permanent plans.

C. New or Revised

[Insurance Forms]{.underline}: None

ROBERT W. CAREY

Assistant Director for Insurance

[DISTRIBUTION]{.underline}:

335/29 80\
310/290 55\
310/291 200\
310/Library 1\
244C 10

September 30, 1977 M29-I, Part II\
Change 14

CONTENTS

CHAPTER 36. CONVERSIONS

PARAGRAPH **PAGE**

36.01 General 36-1\
36.02 Initial Processing of Application 36-I\
36.03 Reserve 36-3\
36.04 Effective Date 36-3\
36.05 Effective Date of Change 364\
36.06 Current Effective Date 36-5\
36.07 Future Effective Date 36-5\
36.08 Insure d Rated Mentally Incompetent 36-6\
36.09 Clerical Processing 36-6\
36.10 Processing by Computer System 36-8\
36.11 Total Disability Waiver-Pending 36-9\
36.12 Total Disability Waiver in Effect 36-9\
36.13 TDIP Premium Rates 36-9\
36.14 Conversion with TDIP Rider 36-10\
36.15 Conversion Disapproved-Term Insurance Continued 36-11\
36.16 Change or Withdrawal of Application 36-11\
36.17 Reinstatement and Conversion 36-11\
36.18 Inadvertent Conversion of NSLI to An Endowment Plan While\
Insured Is Totally Disabled 36-12\
36.19 Death of Insured Before Conversion 36-12

•

36.i

May 12, 1980 M29-I, Part ll\
Change 16

CHAPTER 36. CONVERSIONS

36.01 GENERAL

**a.** The policy, rules and requirements for converting term insurance
are included in M29-l, part **I,** chapter 18.

b\. The Policy Service technician will complete all actions when
processing an application for conversion, including the preparation of
input documents.

c\. VA Form 29-358, Application for Conversion (NSLI-USGLI), should be
used by NSLI (National Service Life Insurance) and **USGLI** (United
States Government Life Insurance) applicants.

d\. Application for Exchange to Special Endowment at Age 96 Plan, should
be used by USGLI applicants age 65 and over when applying for the
Special Endowment at Age 96 plan of insurance.

e\. An informal request for conversion clearly specifying the plan
desired and amount of insurance to be converted will be considered as an
acceptable application.

f\. The 5-year level premium term and 5-year limited convertible term
insurance under premium-paying conditions, may be converted, wholly or
in part, in multiples of \$500, but not less than \$ l ,000 to the
various plans of insurance available under the same insurance program.

g\. Insurance issued under 38 U.S.C. 621 (RS) which has been exchanged
for a limited convertible term policy (W) cannot be renewed after the
policyholder\'s 50th birthday. If continuous insurance protection is
desired, the contract must be converted before the end of the term
period which ends after the 50th birthday. However, if the premiums for
the W term policy are being waived under 38 U.S.C. 712 on the final
termination date, the insurance will not be terminated. If conversion
notifications were sent to the insured and no reply is received, the W
term policy will be automatically converted to an ordinary life policy.

h\. Two or more term contracts bearing different premium due dates, or
different effective dates but the same premium due date, may be
consolidated and converted as of the premium due date of the contract
bearing the latest effective date. Such consolidated contract may be
antedated in the same manner as a single contract, except that the
effective date may not be before the effective date of the term contract
bearing the latest effective date.

i\. When two or more term policies with dividend credits and/or paid-up
additions are consolidated and converted, the dividend credits and/or
paid-up additions \`will also be combined and retained as part of the
converted policy.

j\. When a policy \`with paid-up additions is split in two or more
policies, the insured will be advised that all or part of the paid-up
addition may be allocated to either contract, if the amount of paid-up
additions to be split is involved in the conversion.

k\. When a term policy \`with paid-up additions is converted to an
endowment plan, the paid-up life additions may be retained, without any
adjustment. The reserve of the paid-up life additions may be applied to
purchase paid-up endowment additions based on the basic endowment policy
and the attained age of the insured, or purchase the same amount of
paid-up endowment additions as there were paid-up life additions \`with
the insured paying the difference in reserve.

36.02 INITIAL PROCESSING OF APPLICATION

a\. When a VA Form 29-358, or an informal request for conversion is
received in the Policy Service Section, the Policy Service technician
will review the application to determine if all requirements have been
met.

b\. Generally, a VA Form 29-5886b, Insurance Record Printout, is
received with the application; if it is not, it will be requested. The
Policy Service technician \`will compare the identifying information
such as name, address and insurance

-36-1

M29-1, Part II May 12, 1980

Change 16

numbers with the VA Form 29-5886b. Also, if the insured has more than
one policy, flu application will be checked as to which policy the
insured desires to convert.

c\. A conversion application is acceptable provided that:

\(I\) The application is \[postmarked\] within 61 days of the next
premium due date. (Lapsed contracts cannot be converted until
reinstatement requirements are met.)

\(2\) The postmark date of the application or the date it was otherwise
delivered to the VA is within 31 days from the date the application was
signed.

\(3\) The application is unsigned and is not for an endowment plan.

\(4\) All other requirements have been met, but the insured failed to
submit the initial premium.

\(5\) When the how paid code is 7 (In-Service Waiver of Premiums) on the
RPO and there is no break in the service dates.

d\. If the unsigned application is for an endowment plan and all other
requirements have been met, the insured \`will be sent a supplemental
application.

e\. If the application was postmarked or delivered to the VA more than
31 days after the date of signature, the application \`will be approved.

f\. Whenever it is necessary to disapprove an application or request a
supplemental, the insured \`will be advised by a dictated or automatic
typewriter letter of the action taken. If the application has been
disapproved, the insured \`will be furnished new requirements. A VA Form
29-358 will also be enclosed. If a supplemental application is needed, a
photocopy \~ of the original application will be made and enclosed
\`with the letter. The photocopy will be noted SUPPLEMENTAL (in red) W
in the upper right corner. The signature block will also be circled.

NOTE: If the unsigned application has a beneficiary and option
designation, the insured should be advised that unless the photocopy is
signed, dated and returned, the beneficiary and option designation is
not acceptable. Also, it should be noted that whenever an application is
received indicating a beneficiary and option designation, it will be
reviewed for acceptability as outlined in paragraph 15.04 of this
manual.

g\. After a conversion application has been reviewed for the items
listed in subparagraph c above, the following guidelines \`will be used
in determining if the insured is eligible for the amount and plan of
insurance applied for:

\(I\) Determine the amount of insurance to be converted \[as follows:

\(a\) If the insured shows the full amount of the policy to be converted
in item 6A and leaves the \"Amount of Term Insurance To Be Continued\"
(item 6D) blank, convert the full amount.

\(b\) If the insured shows the full amount of the policy to be converted
and inserts an amount in \"Amount of Term Insurance To Be Continued\"
(item 6D), convert the full amount and disregard the amount to be
retained.

\(c\) If the insured indicates a desire to convert an amount less than
the full amount of the policy and leaves the \"Amount of Term Insurance
To Be Continued\" (item 6D) blank, convert the amount shown and retain
the balance.

\(d\) If the insured indicates a desire to convert less than the full
amount of the policy and shows an amount equal to the balance of the
policy in the \"Amount of Term Insurance To Be Continued\" (item 6D),
convert the amount shown and retain the balance.

\(e\) If the insured indicates a desire to convert an amount less than
the full amount of the term policy and shows an

36-2

May 12,1980 M29-1, Part ll\
Change 16

amount which, when added to the amount being converted, is less than the
full amount of **the** policy in \"Amount of Term Insurance To Be
Continued\" (item 6D), convert and retain the amount shown on the
application.

\(f\) If the insured indicates a desire to convert an amount less than
the full amount of the term policy and shows an amount which, when added
to the amount being converted, is greater than the full amount of the
policy in \"Amount of Term Insurance To Be Continued\" (item 6D),
convert and retain up to the full amount of the policy. Advise the
insured that the amount to be converted and continued cannot exceed the
face amount of the policy.\]

\(2\) If a premium for the converted policy was not received and there
is insufficient reserve credit and/or premium overage available, the
conversion \`will be processed. The effective date of conversion and
next month due will be the same.

\(3\) If the insured is totally disabled and requesting an endowment
plan and the policy prefix is other than K, an endowment plan is not
permitted.

\(4\) Conversion to special endowment at age 96 for K policyholders is
not permitted unless the insured has reached his or her 65th birthday.

36-2a

M29-1, Part II

Advance Manual Change No. 2-86 **July** 8, 1986

[CHAPTER 36. CONVERSIONS]{.underline}

A. [Change:]{.underline} M29-1, Part 11, Chapter 36. This change is
issued to correct\
misinformation contained in paragraph 36.02h in regard to\
premium rates on V and H policies at ages 60 through 65 being\
identical for Ordinary Life and 30-Payment Life plans.

**3.** [Procedure]{.underline}: Page 36-3, delete paragraph 36.02h and
substitute the following:

h\. The premium rates for V and H policies age 60, 61, 63, 64 and 65 are
identical for Ordinary Life and 30-Payment Life. The premium rate at age
62 for a 30-Payment Life V and H policy is one cent per/thousand
per/month greater than an Ordinary Life age 62 V and H policy.
Therefore, the 30-Payment Life policy will be issued in lieu of the
Ordinary Life plan for ages 60 through 65. An insured whose attained age
is 73 through 75 will be issued a 20-Payment Life policy in lieu of the
Ordinary Life policy, since the premium rates are the same. The insured
will be advised that the plan substitution was made in his or her best
interest.

C. New or Revised

[Insurance Forms]{.underline}: None

PAUL F. KOONS

Assistant Director for Insurance

[DISTRIBUTION]{.underline}:

335/29 92\
310/290 51\
310/291 111\
310/Library 1\
CO/311D 1

September 30, 1977 M29-1, Part II\
Change 14

\(5\) if the insured selects an endowment plan, the health question must
be answered. If the insured answered YES or there is evidence of
disability in the folder, the application will be referred to the
Medical Determination Section for a decision as to its acceptability. If
the question is unanswered, a FL 29-615 will be released requesting that
part II of the form letter be completed. Upon return of the FL 29-615,
it will be referred to the Medical Determination Section for a decision
as to its acceptability. The current effective date cannot be more than
31 days from the date the application was signed.

h\. Since the premiums on V and H policies at ages 60 through 65 are
identical for ordinary life and 30-payment life, the 30-payment life
policy will be issued in lieu of the ordinary life plan. This is also
true for an insured whose attained ages are 73 through 75 in which case
the 20-payment life policy will be substituted for the ordinary life
plan. The insured will be advised that the substitution was made in his
or her best interests since the premiums on the limited life plan and
the ordinary life plan are the same.

36.03 RESERVE

a\. On an ante dated conversion, the reserve or difference in reserve,
may be paid by a direct payment and/or a loan on the new policy, if the
new policy is antedated 1 or more years. The amount of reserve or
difference in reserve must be paid in full. No shortages will be
allowed.

b\. Term reserve credit will not be allowed under the following
conditions:

\(l\) Term policies on which premiums are being waived under 38 U.S.C.
724.

\(2\) Exchange to an endowment at age 96 (USGLI).

c\. Usually the reserve on the term policy is used as a credit toward
the initial premium for the new policy. However, if it is not
administratively possible to apply the credit because premiums are being
waived (38 U.S.C. 712 or 748) or paid by allotment, DFB (deduction from
benefits), or payroll deduction, the reserve credit (\$1 or more) will
be refunded to the insured. If reserve is less than \$1 hold as a
premium credit.

d\. The amount of fractional values reserve will be determined from the
applicable tables in the following manuals:

\(1\) K - M294, part II.\
(2) V or H - M29-2, part 111A.\
(3) RS or RH - M90-6, parts I and **II.\
**(4) W - M29-8, part III.\
**36.04 EFFECTIVE DATE**

a\. The effective date of the permanent plan selected may be established
as any one of the following:

\(l\) **Current Effective Date-is** the premium due date of the premium
month in which the application was submitted, or the next following due
date, or is the month preceding the month in which the application was
submitted provided the premium for that month was not paid.

\(2\) Future **Effective Date-is** the date any future premium becomes
due after the next following due date. This date must be no later than
the fourth premium due date following the date of application. However,
when conversion is to an endowment plan the effective date cannot be
more than 31 days from the date of signature.

\(3\) **Intermediate Effective Date-is** the date any past premium
became due within any term period. Under the NSLI program it is not
permissible to antedate to a younger age in order to qualify for a
modified life plan of

36-3

September 30, 1977

M29-1, Part II

Change 14

insurance. However, if an application is submitted during the latter
half of the insured\'s 60th year of age (modified life at age
65-insurance age 61), or during the latter half of the insured\'s 69th
year of age (modified life at age 70-insurance age 70), and there is
evidence that the application was belatedly submitted because the
insured considered our instructions confusing, the application will be
accepted and the policy will be antedated to the latest possible
effective date. Under the USGLI program, it is not permissible to
antedate a conversion to an age younger than 65 when converting to the
special endowment at age 96.

\(4\) **Original Effective Date-is** the effective date of the original
term contract.

\(5\) **Effective Date Not Indicated-is** the current effective date
when all of the requirements have been met.

36.05 EFFECTIVE DATE OF CHANGE

a\. The effective date of change for conversion will always be the
premium due date and will be determined as follows:

\(I\) Use the premium due date of the premium paying (not calendar)
month in which request for conversion was submitted, governed by the
postmark date if mailed, by the earliest VA receiving stamp date if
otherwise delivered, or by the date of execution if received through
military channels if:

\(a\) The premium for that month has not been paid, or,

\(b\) The insured requests that the effective date of the permanent plan
be established as of the premium due date of the month in which the
application is submitted, even though the premium for that month has
been paid. In this event, allow credit for the unearned premium, if any,
on the amount of insurance converted.

b\. Use the premium due date of the next premium paying (not calendar)
month, unless otherwise requested

by the insured if: w

\(I\) The premium for the month in which the request is submitted has
been paid.

\(2\) The method of payment is by allotment, DFB, or by payroll
deduction.

\(3\) Premiums on the term contract are being waived under the inservice
or disability waiver provisions.

c\. Use the premium due date indicated by the insured, if the insured
requests that the permanent plan be effective as of a premium due date
which is later than the next premium due date, provided the effective
date requested is not later than the fourth premium due after the
postmark date of the application, and all other requirements are met.

d\. When an application for conversion is received and the insured
indicates a current effective date, and shows the month the allotment or
DFB is to be established, the effective date of conversion will be the
month following the month in which the allotment or DFB is established
(or in some cases increased) in order to keep the premium payments l
month in advance.

EXAMPLE: Application for conversion PMD 2-21-76, allotment or DFB to be
established or increased effective April 1976, the conversion will be
made effective May 1976.

e\. When an endowment plan is selected and premiums are being paid by
allotment or deduction from benefit payments and the MONTH ALLOTMENT
EFFECTIVE will cause the effective date of the policy to be more than 31
days from the date of signature, the effective date of conversion will
be determined by the postmark date of the application.

36A

September 30, 1977 M29-1, Part II\
Change 14\
36.06 CURRENT EFFECTIVE DATE

a\. Generally, when an insured requests a date of conversion that can be
interpreted as a current effective date, as opposed to an antedation or
a future date, the application will be processed **as** a CURRENT DATE
conversion without requesting any further clarification from the
insured. The following are examples of the types of cases involved using
the first of the month as the due date:

\(1\) Application mailed 11-14-75\
Requested Effective Date 10-01-75\
Account Paid Through 10-31-75

The conversion may be granted with an effective date of 11-01-75
provided the insurable age does not change.

\(2\) Application mailed 11-14-75\
Requested Effective Date 12-01-75\
Account Paid Through 10-31-75

The conversion may be granted with an effective date of 11-01-75.

\(3\) Application mailed 11-28-75\
Requested Effective Date 11-01-75\
Account Paid Through 09-30-75

Provided the conversion would not result in the issuance of a lapsed
policy, the conversion may be granted effective 10-01-75.

NOTE: The provisions of VA Regulations 3018 for USGLI and 3407.2 for
NSLI provide for acceptance of delayed underwriting applications (within
61 days of the due date) when accompanied by a premium payment.

\(4\) Application Mailed 11-14-75\
Requested Effective Date 12-01-75\
Account Paid Through 11-30-75

Normally, this conversion would be effective as of 12-01-75. However, if
the insurable age would be younger as of 11-01-75, the effective date
will be 11-01-75.

**b.** In **all** of the above instances, the insured will be advised of
the reason for changing the requested effective date. He or she will
also be advised that if our action is not agreeable, further
requirements will be sent upon request.

c\. Be aware at **all** times of the possibility of granting an
effective date to save age of the insured, providing it does not become
an antedated conversion.

36.07 FUTURE EFFECTIVE DATE

a\. When the insured requests **a** conversion to be effective as of a
future date, process the application if:

\(1\) Premiums are paid through the premium month immediately preceding
the requested effective date.

\(2\) The requested effective date is not later than the fourth premium
due date after the postmark date of the application.

**(3)** Monetary requirements have been met.

!1-

36-5

M29-1, Part II September 30,1977

change 14

b\. If the effective date selected is later than the fourth premium due
date after the postmark date, the application will be disapproved and
the insured will be advised to reapply in the month before a requested
effective date.

c\. When granting a future effective date, be cognizant of insurance
originally issued with an RS prefix which was exchanged for a Limited
Convertible Term policy (W). This plan of insurance cannot be renewed
after the insured\'s 50th birthday. The effective date of conversion
cannot be beyond the renewal date.

36.08 INSURED RATED MENTALLY INCOMPETENT

a\. When the insurance records indicate the insured is incompetent and a
fiduciary has not been appointed, conversion may be effected provided
the insured possessed sufficient mental capacity to understand the
nature of his or her act. To establish the insured\'s ability to make
such a contract change, the application and insurance folder will be
forwarded to the Insurance Claims Section for a determination.

b\. When the insurance records indicate the insured is incompetent and a
fiduciary has been appointed, application may be made by the fiduciary,
with the approval of the appropriate court, if required by State laws.
It is not necessary for a fiduciary to obtain court approval if the
insured has been totally disabled for 20 years or **more.**

c\. When a fiduciary has been appointed, and the insured, during a
period of lucidity, signs an application, the fiduciary must also sign
the application, and if required, secure approval of the court which
made the appointment. A letter, accompanied by the application, will be
sent to the fiduciary explaining the circumstances and requesting his or
her signature. It will not be necessary to determine the mental capacity
of the insured.

36.09 CLERICAL PROCESSING

a\. The following types of conversion actions cannot be automatically
processed by the computer system, and therefore, require the clerical
preparation of input to update the master record:

\(I\) Consolidation and conversion when contract being deleted has
pending transactions or optional segments other than TDIP.

\(2\) Antedate d reduction and conversion.

\(3\) Term policy is being split and converted to three or more
permanent plans or there are three or more policies on tape.

\(4\) Conversion of USGLI (K) accounts.

\(5\) Dividend credit is being applied to pay premiums and/or premiums
and difference in reserve to antedate policy.

\(6\) Two or more pending remittances required to validate conversion.

\(7\) Amount of insurance not in multiples of \$500.

\(8\) Single remittance to be applied to two or more policies.

\(9\) Policy(ies) being converted has a \$5 TDIP age 60 rider; \$10 TDIP
age 60 rider and TDIP age at conversion is 55 or over; \$10 TDIP age 65
rider and TDIP age at conversion is 61 years or over.

\(10\) Split conversion-dividend credit balance on term policy.

\(II\) Term policy when 724 waiver **is** terminated during current term
period.

36-6

September 30, 1977 M29-1, Part II\
Change 14

b\. Clerical preparation of input is required to change or update each
segment of the master record affected by the conversion action. Detailed
coding instruction of input documents are outlined in MP-6, part II,
Supplement Nos. 2.1 and 2.2. VA Form 29-5886b, will be coded as the
primary input document. An OCR (optical character recognition) document
will be completed for those transactions that cannot be coded on the
RPO. Keypunch input cards will be used only in those instances when no
OCR document has been provided.

c\. The following input documents and forms will be processed:

\(1\) VA Form 29-328, Underwriting Worksheet, for filing in the
insurance folder.

\(2\) VA Form 29-8522, Policy, transaction type 022, to effect the
policy changes.

\(3\) VA Form 29-8523, Premium/TDIP, transaction type 053, to change
premium status, the how paid code and the mode in the master record.

NOTE: VA Form 29-8522, and VA Form 29-8523 are related inputs and must
be inserted consecutively.

\(4\) VA Form 29-8527, Accounting Control, transaction type 089, to
effect miscellaneous accounting action.

\(5\) VA Form 29-8526, Pending Transaction, transaction type 098, to
delete the pending transactions and/or diary messages.

\(6\) VA Form 29-8530, Life Miscellaneous, transaction type 000. The
policy issue code entered on this document will cause the system to
automatically issue the appropriate policy and/or status. It is
important to control the sequence of this document by completing the
sort field, to assure that it is processed after all other changes have
been completed.

d\. In addition to the above inputs, the following forms, if applicable,
will also be prepared:

\(I\) VA Form 29-8528, Paid Dividend/Dividend History, to adjust
dividends.

\(2\) VA Form 29-5934, Change of Address for Insurance Purpose, if
address change is required.

\(3\) VA Form 29-8525, Dividend/Loan/Lien, transaction type 004 or 084,
to insert or make changes to the dividend credit or adjust paid-up
additions, transaction type 005 or 085 to insert or make changes to the
loan segment and/or 006 or 086 to insert or make changes to the lien
segment.

NOTE: Inserting or changing the above segments will require, as
applicable, a VA Form 294459, Dividend Deposit/Credit Statement; VA Form
29-8668, Statement of Paid-Up Additions, or a VA Form 29-1468b, Notice
of Approval of Policy Loan, and/or a lien letter.

\(4\) VA Form 29-8531, TDIP, transaction type 007 or 027 to insert or
change date in the TDIP segment in the master record. When transaction
types 007 and 027 are used, the control sort field should be completed
to assure proper sequence of inputs being processed.

\(5\) If the case is being processed in the VA Center, St. Paul and
subsequent premiums are to be deducted from VA benefit payments,
allotment from service department active, or retirement pay, a VA Form
29-8522, transaction type 082 with **a** 951 policy callup code will be
prepared to assure that the records will be transferred, to the VA
Center, Philadelphia.

\(6\) When premiums are being paid by deduction from service pay or VA
benefit payments, action will be taken to adjust the deduction in
accordance with M29-1, part **II,** chapters 29 and 30.

36-7

M29-1, Part II September 30, 1977

Change 14

36.10 PROCESSING BY COMPUTER SYSTEM

a\. The computer system will automatically accomplish the following
actions upon acceptance of a VA Form

29-8520, Underwriting, or VA Form 29-5886b coded with a transaction type
000.

NOTE: Instructions for coding of input with transaction type 000 are
outlined in MP-6, part II, supplement Nos. 1.2 and 2. 2.

\(1\) Update policy, premium, TDIP and other optional segments of the
insurance master record.

\(2\) Apply initial payment and any credit(s) identified on the input.

\(3\) Release policy for new plan of insurance and TDIP rider if
involved.

\(4\) Refund or apply reserve credit from the term policy in accordance
with disposition code on input.

\(5\) Delete all 970 conversion diaries.

\(6\) Authorize dividend(s) payable on term policy.

\(7\) Release status on direct pay accounts only.

\(8\) Establish lien for cash dividend overpayment and generate an RPO
with reason code 008/968 for clerical processing.

\(9\) Generate an RPO with the message DIVADJ when a dividend adjustment
is required because the option is other than cash.

\(10\) Generate an RPO with reason code UWY on a split conversion when
the original term policy has a paid-up additions segment.

b\. When premiums are being paid by allotment or DFB, the system will
automatically accomplish the following actions in addition to those
normally involved in the processing of **a** conversion on direct pay
accounts:

\(1\) Prepare and release a VA Form 29-1588, Request for Allotment
Deduction Change, or VA Form 29-5926, Request for DFB Action, to adjust
the deduction to provide the amount needed to pay the new premium under
the following conditions:

\(a\) Single policy case.

\(b\) The conversion is for full amount.

\(c\) The present deduction equals the term premium.

\(d\) The present deduction is paying currently or on a month-in-advance
**basis.**

**(e)** The action type is other than 20.

\(2\) Insert **a** pending diary message showing the month, year and
amount of anticipated discontinuance.

NOTE: If the system fails to release either a VA Form 29-1588 or VA Form
29-5926 after processing a conversion, an RPO with reason code 118 will
be generated for clerical preparation of the appropriate form.

c\. When **a** conversion is being processed on a direct pay account and
the insured desires that future premiums are to be paid by allotment or
DFB, the Policy Service technician will prepare and release **a** VA
Form 29-1588 or

36-8

M29-1, Part II

Advance Manual Change No. 7-84 July 20, 1984

[Chapter 36]{.underline} - [Conversions]{.underline}

A. [Change:]{.underline} M29-1, Part II, Chapter 3. This Advance Manual
Change is issued in\
conjunction with Advance Manual Change 6-84 in MP-6, Part II,\
Supplement No. 1.4, which introduces RPO reason code 966. An RPO\
with reason code 966 is generated when the system processes a\
conversion on a payroll deduction or direct pay account, but does not\
release status because there are insufficient moneys to pay the initial\
premium.

B. [Procedure]{.underline}: Page 36-9, add the following as subparagraph
36. 10f:

f\. In those instances when the system processes a conversion and
generates an RPO with reason code 966, release status notice and initial
bill clerically.

C. New or Revised

[Insurance Forms]{.underline}: None

• ROBERT W. CAREY

Assistant Director for Insurance

[DISTRIBUTION]{.underline}:

335/29 92\
310/290 51\
310/291 111\
310/Library 1\
203/SDA 2\
CO/311D 2

May 12, 1980 M29-1, Part II\
Change 16

VA Form 29-5926, and a VA Form 29-547, Notice-Important Information
About Your Government Life Insurance, or **a** VA Form 29-5707,
Acknowledgment Request for Deductions from Benefit Payments. A 953/978
diary message will be inserted.

d\. After all action has been taken to process the application either
automatically or clerically, the application will be stamped APPROVED
dated and initialed by the Policy Service technician, and stamped
**READY** FOR FILE. The application will be forwarded for ailing in the
insurance folder.

e\. In those instances when the system processes **a** conversion and
generates an **RPO** with reason codes 965/967, a VA Form 29-547 will be
prepared to notify the insured of approval of the conversion.

36.11 TOTAL DISABILITY WAIVER-PENDING

When an application for conversion is received and the RPO shows a
pending disability waiver diary, \[forward the application and insurance
folder to Insurance Claims Section with **a** request as to the status
of the claim for waiver and if **a** decision can be made immediately.
If **a** decision cannot be made, the application for conversion will be
processed. However, the conversion action \`will be suspended until a
decision is reached if conversion to **an** endowment policy is
requested.\] When the waiver decision is completed, the case will be
returned to the Policy Service Section for processing of the
\[application for\] conversion.

36.12 TOTAL DISABILITY WAIVER IN EFFECT

a\. NSLI term insurance on which premiums are being waived under 38
U.S.C. 712 may **be** converted to any of the permanent plans of
insurance available except the endowment plans.

b\. USGLI term insurance on which premiums are being waived (if insured
is not **T/P** (total and permanent)) under 38

**U.S.C.** 748 may be converted to any of the permanent plans, including
endowment plans.

c\. When VA Form 29-358 for conversion is received and premiums on the
account are waived, the applicant will be advised by letter of the exact
premium for the plan selected unless the correct premium is entered in
the payment block on the application.

36.13 TDIP PREMIUM RATES

a\. When an NSLI term policy with TDIP age 60-\$5 or \$10 rider is
converted and flu rider is to be continued on the b permanent plan, the
premium rate for the rider is determined by the permanent plan policy
selected and the insurance age as

of the date of change. When the insurance age at the time of conversion
is 55 or older, the TDIP age remains the same.

b\. When an NSLI term policy \`with TDIP age 65 rider is converted and
the rider is to be continued on the permanent plan Policy and the rider
was issued or last renewed at the rate for age 54 or under, the
conversion will be processed in the usual way; that is, the premium for
the rider being continued is the rate for a new issue of the permanent
plan TDIP age 65 rider at the insured\'s attained age (TDIP age) on the
date the conversion is effected.

c\. When the NSLI term age 65 rider was last renewed at age 55 or over,
and TDIP premiums on the permanent plan rider are scheduled for payment
to the insured\'s 65th birthday (TDIP cease code 3), the rate is the
same as that heretofore paid on the term rider.

d\. When the NSLI term \`with TDIP age 65 rider was last renewed at age
55 or over, and TDIP premiums on the permanent plan rider are scheduled
for payment to age 64 or under (TDIP cease code 2), the rate will be
furnished by the Actuarial Staff (310/299), VA center, Philadelphia.

e\. When USGLI (K) term insurance \`with TDIP is converted and the
**TDIP** is continued on the permanent plan policy, the term TDIP will
not be terminated. If converted to ordinary life, the original TDIP
effective date and premium will b- continued. On other available
permanent plans, the original effective date will be continued but **a**
new premium rate will be payable.

36-9

M29-1, Part II May 12, 1980

Change 16

f\. Definition of Disability Rider Codes:

\(1\) TDIP cease code I-Age 60 rider-rate code l=Age 60-\$5 rider.

\(2\) TDIP cease code 2-Age 65 rider-rate code 2=Age 60 or 65-\$10
rider.

\(3\) TDIP cease code 3-Age 65 rider-rate code 3=Age 60 or 65-\$I 0
rider.

36.14 CONVERSION WITH TDIP RIDER

a\. Applications for conversion of a term policy with a TDIP rider
attached should indicate clearly whether the TDIP is to be continued on
flee converted policy. If no provision is made for converting the TDIP
and the only evidence of record is a blank space or the insertion of
dashes, the insured will be asked to clarify his or her intent.

b\. The Policy Service technician \`will release a letter to the insured
explaining that if the rider is not continued at the time of conversion,
an application \`will not be accepted on or after the insured\'s 55th
birthday. The insured should also be advised that if no reply is
received \`within 15 days of the date of our letter, the TDIP rider will
not be continued on the converted policy.

c\. The Policy Service technician will delete any 970 diary from the
master record and insert a 30-day diary with the message 970 CONV.

d\. If the insured does not reply within the 30-day period, flu
conversion will be processed without the TDIP rider.

e\. When an insured indicates continuance of the TDIP rider on the
converted policy(ies), the Policy Service technician **will \~** process
the application as follows:

\(1\) If the TDIP premium rate quoted by the insured is incorrect or the
rate is not shown, flee conversion application will b processed.

\[(2)\] The insured \`will be advised by letter of the correct TDIP and
insurance premium rates for the new policy \[only if the rider being
continued is a \$5 or \$10 age 60 rider and TDIP age at conversion is 55
or over or if it is a \$10 TDIP age 65 rider and TDIP age at conversion
is 61 years or over.\] If the rider being continued is a \$5 or \$10 age
60 rider the insured should also be advised of the availability of the
\$10 age 65 rider.

\[(3)\] If the insured objects to the increase in the TDIP premium rate
and requests discontinuance of the rider, it \`will be canceled as of
the effective date of conversion. Any TDIP premium payments submitted
after the date of conversion will be refunded.

36-10

September 30,1977 M29-I, Part II\
Change 14

36.15 CONVERSION DISAPPROVED-TERM INSURANCE TO BE CONTINUED

When it is necessary to disapprove an application for conversion, and
premiums have been tendered for the permanent plan, take action to
continue the term insurance in force as follows:

a\. Premiums Paid Direct

\(1\) When an application for conversion of the full amount of an
insurance contract is disapproved, or an application for conversion of
part of an insurance contract on which the insured indicated a desire to
continue the remaining amount of term insurance in force is disapproved,
apply the money tendered as premium for the permanent plan to pay
premiums on the term insurance for as many months as possible.

\(2\) When an application for conversion of a reduced amount of
insurance is disapproved, and the insured does not desire to continue
the remaining amount of term insurance equal to the amount indicated in
the application for conversion, apply the money tendered as premium for
the permanent plan to pay premium on the reduced amount of term
insurance for as many months as possible.

b\. Premiums Paid by Allotment or DFB

\(I\) When an application for conversion of the full amount or reduced
amount is disapproved, the insured will be advised of the reason for
disapproval of the application and provided with status of the term
policy and an application for conversion in the event he or she should
desire to reapply.

\(2\) When an acceptable beneficiary designation appears on the
application, it will be processed and the insured will be requested to
confirm the designation.

36.16 CHANGE OR WITHDRAWAL OF APPLICATION

a\. When a properly signed request for withdrawal, or for a change in
plan or amount, other than stated in the original application for
conversion, is received in the VA, and bears a postmark date before the
EFFECTIVE F DATE OF CHANGE, or there is evidence that such request was
placed in military channels before the EFFECTIVE DATE OF CHANGE, the
insured\'s request will be granted. Also, when a request for a
permissible plan or amount, other than that stated on the application,
is submitted within 60 calendar days from the date of conversion, it
will be granted. After 60 calendar days from the effective date of
conversion, any change to the contract will be processed as a change of
plan. The insured **will** be informed of the necessary additional
requirements to change the insurance to the amount and plan desired.

b\. When request is acceptable for a change in the plan and/or amount of
the original application, take action as follows:

**(l)** If the original application was not processed, effect conversion
for the plan and amount indicated in the latest request.

\(2\) If the original application was processed, cancel the conversion,
restore the term insurance, and effect conversion for the plan and
amount indicated in the latest request.

\(3\) Advise insured of the action taken.

36.17 REINSTATEMENT AND CONVERSION

a\. If insurance is in a lapsed status, reinstatement requirements must
be met before the conversion may be effected.

b\. Reinstatement and conversion of a term contract, wholly or in part,
may be processed in one operation on one VA Form 29-328, Underwriting
Worksheet. When reinstatement and conversion are effected at the same

36-11

M29-I, Part II September 30, 1977

change 14

time, the conversion may be made in any manner prescribed for
conversions, that is, the permanent plan contract may be issued with a
current effective date, antedated to the effective date of the original
term contract, or an intermediate premium due date. When a reduced
amount of insurance is reinstated and converted, the EFFECTIVE DATE OF
CHANGE for the reduction will be the due date of the premium in default
(date of lapse).

c\. When an applicant for reinstatement and conversion requests that the
permanent plan contract become effective as of a future date but remits
an amount sufficient to pay only the term premium for the month of lapse
and the first premium on the permanent plan, the application for
conversion will be disapproved. Process the application for
reinstatement and advise the insured accordingly. Enclose a new VA Form
29-358.

d\. When reinstatement and conversion are to be effected at the same
time, it will not be necessary to prepare input to show the
reinstatement of the term contract. VA Form 29-5895a or VA Form 29-8526
will be prepared to insert any necessary pending dividend due on the
reinstated term contract. Input, as necessary, will be prepared to
change or insert the master record.

36.18 INADVERTENT CONVERSION OF NSLI TO AN ENDOWMENT PLAN WHILE INSURED
IS TOTALLY DISABLED

If it is found that term insurance was converted to an endowment plan
through administrative error, or otherwise, while the insured was
totally disabled, and there was not fraudulent action on the part of the
insured, take the following action:

a\. If the insured files a claim for waiver of premiums on an endowment
policy because of total disability, the Insurance Claims Section will
advise that under the circumstances he or she is not entitled to a
waiver of premiums on the endowment policy because of the total
disability which existed at the time of conversion. The insured will be
advised of the necessity of remitting monthly premium payments to
maintain the policy in force.

b\. If premiums on the term policy were waived at time of conversion to
an endowment plan, or if waiver is subsequently established as of a date
before the effective date of the conversion, a registered letter will be
sent to the insured with a return receipt requested, advising that
conversion to an endowment plan cannot be made while he or she was
totally disabled. Further, the insured will be advised that he or she
must remit all due and unpaid premiums on the endowment plan from the
effective date of conversion through the current month within 31 days
from the date of the letter.

c\. If the insured was totally disabled when the insurance was converted
to an endowment plan and a claim for waiver of premiums has not been
filed, advise the insured that, while he or she may continue the
insurance on the endowment plan by the timely payment of premiums, he or
she will not be eligible to apply at any time during the current period
of total disability for waiver of premiums because of the total
disability which existed when the application for conversion to the
endowment plan was submitted.

d\. If there was no element of fraud on the part of the insured, afford
him or her the privilege of changing the endowment plan to a Modified
Life, Ordinary Life, 20-Payment Life or 30-Payment Life policy or
reverting to term insurance, which does not require a physical
examination report.

e\. If change from the endowment plan to one of the other permanent
plans is requested, the new policy will bear the same insurance number
and effective date as the endowment policy.

f\. If the insured does not remit any premiums on the endowment plan, or
fails to request a change to another permanent plan within 31 days from
the notice that he or she is not entitled to a waiver of premiums, the
insured retains the endowment policy.

36.19 DEATH OF INSURED BEFORE CONVERSION

When an application for conversion is acceptable, but the insured dies
before the EFFECTIVE DATE OF

CHANGE, disapprove the conversion.

36-12