N.Y. ISC Law § 3219 — New York Code / Act ISC / Article 32 / Section 3219
Annuity and pure endowment contracts and certain group annuity certificates; standard provisions as to contractual rights and responsibil...
Status: in_force

§ 3219. Annuity and pure endowment contracts and certain group annuity\ncertificates; standard provisions as to contractual rights and\nresponsibilities of contract holders, certificate holders and insurers.\n(a) Except as provided in section four thousand two hundred forty of\nthis chapter, every annuity or pure endowment contract except a group\nannuity contract, and every group annuity certificate to which section\nfour thousand two hundred twenty-three of this chapter applies by reason\nof subsection (b) thereof, or to which section four thousand two hundred\ntwenty-three of this chapter would apply if such certificate were not a\nvariable annuity, delivered or issued for delivery in this state, shall\ncontain in substance the following provisions, or provisions which the\nsuperintendent deems to be more favorable to the holders of such\ncontracts or certificates:\n  (1) In any such contract or certificate requiring payments to be made\nto the insurer, that, after the first payment, there shall be a grace\nperiod of thirty-one days following the due date of any subsequent\npayment within which the payment to the insurer may be made.  During\nsuch grace period, the contract or certificate shall continue in full\nforce. If a claim arises under the contract or certificate on account of\ndeath during the grace period, the insurer may deduct from the death\nbenefit, or, in the case of a reversionary annuity, otherwise called a\nsurvivorship annuity, may, at its option, reduce annuity payments to\ntake into account the portion of any unpaid payment applicable to the\nperiod ending with the last day of the month in which such death\noccurred;\n  (2) That, with respect to any statements, other than those relating to\nage, sex, and identity, required as a condition of issuing the contract\nor certificate, the contract or certificate shall be incontestable after\nit has been in force during the lifetime of the person or of each of the\npersons as to whom such statements are required, for a period of two\nyears from its date of issue, except where payments required by the\ncontract or certificate to be made to the insurer have not been made,\nand except for violation of the conditions, if any, of the contract or\ncertificate relating to service in the armed forces; and at the option\nof the insurer, such contract or certificate may also except provisions\nrelating to benefits for total and permanent disability and benefits for\naccidental death;\n  (3) That the contract, together with the application therefor if a\ncopy of such application is attached to the contract when issued, shall\nconstitute the entire contract between the parties;\n  (4) That nothing in the group annuity contract invalidates or impairs\nany right granted to the certificate holder by this section or the\ncertificate;\n  (5) That if the age or sex of the person or persons upon whose life or\nlives the contract or certificate is made or of any of them has been\nmisstated, the amount payable or benefit accruing under the contract or\ncertificate shall be such as the payments to the insurer would have\npurchased according to the correct age or sex; and that if the insurer\nmakes any underpayment or overpayment on account of any such\nmisstatement, the amount thereof, with interest at a rate to be\nspecified in the contract or certificate but not exceeding six per\ncentum per annum, shall be credited to, or charged against, the current\nor next succeeding payment or payments to be made by the insurer under\nthe contract or certificate;\n  (6) That the insurer shall annually ascertain and apportion any\ndivisible surplus accruing on the contract;\n  (7) Specifying the options available upon cessation of payment of\nconsiderations under a contract or certificate. Such options, except for\nthose under a reversionary annuity or pure endowment contract, shall be\nin accordance with section four thousand two hundred twenty-three of\nthis chapter;\n  (8) In any such contract or certificate requiring payments to be made\nto the insurer that at any time within three years from the date of\ndefault in making payments to the insurer unless the cash surrender\nvalue has been paid, the contract or certificate shall be reinstated if\nthe person entitled thereto pursuant to the provisions of the contract\nor certificate\n  (A) applies to the insurer therefor,\n  (B) pays to the insurer all overdue payments and all indebtedness on\nthe contract or certificate with interest on such overdue payments at a\nrate specified in the contract or certificate but not to exceed six per\ncent per annum, compounded annually, and interest on any such\nindebtedness at a rate or rates not exceeding the applicable loan rate\nor rates determined in accordance with the contract's or certificate's\nprovisions, and\n  (C) where required by the insurer as a condition of reinstatement,\nprovides evidence of insurability including good health reasonably\nsatisfactory to the insurer;\n  (9) That upon surrender of the contract or certificate, together with\na written request for cancellation, to the insurer during a period of\nnot less than ten days nor more than thirty days from the date the\ncontract or certificate was delivered to the holder thereof, the insurer\nrefund either (i) any consideration paid for the contract or\ncertificate, including any fees or other charges or, if the contract or\ncertificate, or notice attached thereto, so provides, and the contract\nor certificate is subject to the provisions of section four thousand two\nhundred twenty-three of this chapter and provides for the determination\nof any cash surrender benefits in accordance with a market-value\nadjustment formula, (ii) the amount of the cash surrender benefits\nprovided under the contract or certificate plus the amount of all fees\nand other charges deducted from gross considerations or imposed under\nthe contract or certificate. This provision shall appear in the contract\nor certificate or in a notice attached to it; provided, however, that\nthe contract or certificate sold by mail order must contain a provision\npermitting the contract or certificate holder a thirty day period for\nsuch surrender.\n  (b) Any of the provisions of subsection (a) hereof or portions not\napplicable to non-participating contracts or certificates or not\napplicable to contracts or certificates for which a single payment to\nthe insurer is made shall, to that extent, not be incorporated in such\ncontract or certificate. Paragraphs one and eight of subsection (a) of\nthis section shall not apply to contracts or certificates that do not\nrequire payments to be made to the insurer. An insurer shall issue a\ncertificate for delivery to a person covered under a group annuity\ncontract if such certificate, when issued, would be subject to\nsubsection (a) of this section.\n  (c) Annuity contracts subject to this section may permit an adjustable\nmaximum rate of interest on loans. Any such contract shall provide that\nloans shall bear interest at a rate not in excess of an adjustable\nmaximum interest rate established from time to time by the insurer as\npermitted by law, and shall specify the regular intervals at which the\ninterest rate is to be determined which shall be at least once every\ntwelve months, but not more frequently than once in any three month\nperiod.\n  (d) This section shall not apply to contracts for deferred annuities\nor reversionary annuities upon the lives of beneficiaries under life\ninsurance policies, nor, except to the extent expressly provided herein,\nto group annuity contracts.\n