No policy of life insurance shall be issued in this state or be issued by a life insurance company organized under the laws of this state unless the policy contains the following:
(1) PAYMENT OF PREMIUMS. A provision that all premiums after the first shall be payable in advance either at the home office of the company or to an agent of the company, upon delivery of a receipt signed by one (1) or more of the officers who shall be designated in the policy, when a receipt is requested by the policyholder;
(2) GRACE FOR PAYMENT OF PREMIUMS; INTEREST; DEDUCTION FOR DEATH. A provision for a grace of one (1) month for the payment of every premium after the first year, which may be subject to an interest charge, during which month the insurance shall continue in force, which provision may contain a stipulation that if the insured dies during the month of grace, the overdue premium will be deducted in any settlement under the policy;
(3) POLICY IS ENTIRE CONTRACT; INCONTESTABILITY; EXCEPTIONS. A provision that the policy shall constitute the entire contract between the parties, and shall be incontestable after it has been in force during the lifetime of the insured for a specified period, not more than two (2) years from its date, except for nonpayment of premiums and except for violations of the conditions of the policy relating to naval and military services in time of war;
(4) STATEMENTS ARE REPRESENTATIONS AND NOT WARRANTIES IN ABSENCE OF FRAUD; WRITTEN APPLICATION MADE PART OF POLICY. A provision, except in industrial policies, that all statements made by the insured shall, in the absence of fraud, be deemed representations and not warranties, and that no such statement shall void the policy unless it is contained in a written application, and a copy of the application is endorsed upon or attached to the policy when issued;
(5) AMOUNT PAYABLE WHERE AGE UNDERSTATED. A provision that if the age of the insured is understated, the amount payable under the policy shall be that which the premium would have purchased at the correct age;
(6) PARTICIPATION IN SURPLUS. In a case of participating policy, a provision that the policy shall participate annually in the divisible surplus of the company beginning not later than the end of the third policy year, and any policy containing provision for annual participation at the end of the first policy year may also provide that the dividend be paid, subject to the payment of the full premium for the second policy year. The insured under any annual dividend policy shall have the right each year to have the dividend arising from the participation either paid in cash or applied in reduction of premiums, or applied to the purchase of paid-up additional insurance, or left to accumulate to the credit of the policy with interest at a rate determined from time to time by the company, but not less than a guaranteed minimum rate specified in the policy; and payable at the maturity of the policy but withdrawable at any time. If the insured fails to notify the company in writing of the election within the period of grace allowed for the payment of premium, the policy shall provide which of the options are effective; provided, that this sentence does not apply to any policy issued to any plan or trust having qualified status under subchapter D, part I, subtitle A of the Internal Revenue Code of 1954, compiled in 26 U.S.C. 401 et seq., nor under § 501(a) of the Internal Revenue Code of 1954 , codified in 26 U.S.C. § 501(a) . This subdivision (6), however, shall not require any individual participating term insurance policy to contain a dividend option under which the dividend may be applied to the purchase of paid-up additional insurance;
(7) LOANS ON POLICIES; EXCEPTION. A provision that after three (3) full years' premiums have been paid, the company, at any time while the policy is in force, will advance on proper assignment of the policy and on the sole security of the policy, at a specified rate of interest, a sum equal to, or at the option of the owner of the policy, less than the amount required by § 56-7-2309 under the conditions specified by § 56-7-2309 ; and that the company will deduct from the loan value any existing indebtedness on the policy and any unpaid balance of the premium for the current policy year, and may collect interest in advance on the loan to the end of the current policy year. It shall be further stipulated in the policy that failure to repay any advance or to pay interest shall not void the policy unless the total indebtedness on the policy to the company equals or exceeds the loan value at the time of the failure, nor until one (1) month after notice has been mailed by the company to the last known address of the insured and of the assignee, if any. No condition other than as provided in this subdivision (7) or in § 56-7-2309 shall be exacted as a prerequisite to the advance. This provision shall not be required in term insurance;
(9) TABLE SHOWING LOAN VALUES AND OPTIONS. A table showing in figures the loan values and the options available under the policies each year upon default in premium payments during at least the first twenty (20) years of the policy;
(10) VALUE OF POLICY TO BE APPLIED FOR OTHER INSURANCE; REINSTATEMENT WITHIN THREE (3) YEARS AFTER DEFAULT. A provision that if, in event of default in premium payments, the value of the policy shall be applied to the purchase of other insurance; and if the insurance shall be in force and the original policy shall not have been surrendered to the company and cancelled, the policy may be reinstated within three (3) years from the default upon evidence of insurability satisfactory to the company and payment of arrears of premiums, with interest;
(11) SETTLEMENT UPON PROOF OF DEATH. A provision that when a policy becomes a claim by the death of the insured, settlement shall be made upon receipt of due proof of death, or not later than two (2) months after receipt of the proof;
(12) TABLE TO SHOW INSTALLMENT PAYMENTS OF POLICY. A table showing the amounts of installments in which the policy may provide its proceeds may be payable;
(13) PROVISIONS NOT APPLICABLE TO SINGLE PREMIUM POLICIES NEED NOT BE INCORPORATED IN SINGLE PREMIUM POLICIES. Any of subdivisions (1)-(12) or portions of subdivisions (1)-(12) relating to premiums not applicable to single premium policies shall to that extent not be incorporated in the single premium policies.
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