Evening star., 1943-10-19

Government Guarantees Insurance Premiums
And Offers Its Own Policies to Drafted Men

General drafting OF pre,Uar
fathers raises many questions
about iDhdt happens to their
financial obligations. This article
on Insurance is the second on
serpicenen's rights and privileges.
~ the Associated PRESS.
! Under the Soldiers and Sailors
Civil Relief Act and the National
Service Life insurance Act, men,
ber OF Uncle Sans armed forces
may carry as high as $4,000 in life
insurance at an average cost Of
about 81 a month during his period
OF service.
The 81 monthly represents what
he pays for his service insurance,
which he may purchase up to
$4,000.
1t costs him nothing during his
service period to carry $4,000 Of his
own private insurance, but he must
arrange to catch up on past-due
premium payments, or to restore
the policy to good standing. within
two years after his discharge.
Recognizing that many service
men must come from the so-called
middle class which normally carries
sizable amount OF private life
insurance, Congress wrote into the
Civil Relief Act provision under
which the Government protects this
insurance up to $4,000.
In return for a Federal guaran-
tee OF premium payments, life In
surance companies are required, in
certain cases, to forego their power
to cancel policies held by service
men on account of nonpayment of
premiums accruing during the Pc
riod of service.
Policy Remains in Effect.
The policy remains In effect and
the serviceman is given two years
after his discharge to repay the pre-
miums or enough Of them to pre-
vent the loan or cash value Of the
policy from dropping below the
amount Of premium payments due.
In the event Of death of the insured
before the premiums are repaid, the
amount due is deducted from the
amount payable.
Failure of the insured to restore
the policy to good standing within
the required time, or to reach some
agreement with the insurer, may re-
suit in termination of the policy,
with the Government paying the in
Surance company the difference be-
tween the amount guaranteed and
the cash surrender value. The serv-
iceman then would owe the Govern
ment for the amount paid.
To be eligible for protection under
the act, policy must be on the
level premium, endowment or legal
reserve plan or in the nature OF life
insurance arising out OF membership
In a fraternal or beneficial organ
ization. A premium must have been
paid before october 6, 1912, or not
less than 80 days before the date the
insured entered the military service.
Protection Limited.
A policy is entitled to protection
regardless of the amount of loan
that may be against 1t. but cannot
be protected if it contains provi-
sion excluding or restricting liability
for death arising from military
service.
Except by court order or by con-
sent of the insured, no assignee of
a policy Except the insurer in con-
nection with policy loan) may ex-
ercise any right or option by virtue
of the assignment.
The law does not prevent a man
from carrying more than $4,000 of
private life insurance, but the Gov
ernment will guarantee premium
payments for only that amount.
The act does not protect premium
payments on national service life
insurance issued by the Govern
ment. However, the premium rates
on this insurance are low, the cost
for $4,000 (the maximum allow
able) OF flve-year level premium
term insurance for a person at age
25 being $50 per month. At age 80
the cost is s7.l0 and at As the charge
is $500.
No Examination Needed,
Government insurance may be
applied for without the requirement
Of medical examination within 100
days after person enters the SER
vice. After that period, proof Of
good health must be furnished,