CHAPTER 417

An Act to amend and reenact §§ 88.1-406 and $8.1-435 of the Code of
Virginia, relating to life insurance and annuity policies and contracts.

[H 626]
Approved March 15, 1956

Be it enacted by the General Assembly of Virginia:

1. That §§ 38.1-406 and 38.1-435 of the Code of Virginia be amended and
reenacted as follows:

§ 38.1-406. No policy of life insurance, other than industrial insur-
ance, annuities and pure endowments with or without return of premiums
or of premiums and interest, shall be delivered or issued for delivery in
this State if it contains any provision:

(1) Limiting the time within which any action at law or in equity
may be commenced to less than one year after the cause of action accrues;

(2) By which the policy shall take effect or purport to take effect as
of a date more than six months before the written application for the
insurance was made if thereby the premium on such policy or contract
ts reduced below the premium which would be payable thereon as deter-
eine by the nearest birthday of the insured when the application was

é;

(3) For any mode of settlement at maturity, of less value than the
amount insured on the face of the policy plus dividend additions, if any,
less any indebtedness to the company on or secured by the policy, and less
any premium, or portion thereof, that may by the terms of the policy be
deducted. This paragraph shall not apply to any nonforfeiture provision
which employs the cash value less indebtedness, if any, to purchase paid-up
or extended insurance, and shall not prohibit the issuance of policies pro-
viding for a limitation in the amount payable under certain specified
conditions;

(4) For forfeiture of the policy for failure to repay any loan on the
policy, or to pay interest on such loan, while the total indebtedness on the
policy, including interest, is less than the loan value thereof; or

(5) To the effect that the agent soliciting the insurance is the agent
of the person insured under the policy. or making the acts or representa-
tions of such agent binding upon the person so insured under the policy.

§ 38.1-435. No policy or contract of life insurance shall be delivered
or issued for delivery in this State if it shall purport to be issued or to take
CH. 417, 418] ACTS OF ASSEMBLY ATT

effect as of a date more than siz months before the written application for
the insurance was made if thereby the premium on such policy or contract
is reduced below the premium which would be payable thereon as deter-
mined by the nearest birthday of the insured when the application was
made; provided, however, that neither this provision nor any other pro-
vision of general law shall prohibit the conversion of any existing life
insurance policy, or any deferred annuity contract purchased by a con-
sideration payable in annual or more frequent installments, and under
which no annuity payments have yet been made, to some form of life
insurance dated back to become effective as at an age not lower than the
age, nearest birthday, of the applicant at the date of issue of such existing
policy or contract, in amount not to exceed the greater of (1) the amount
of insurance under such existing policy or (2) the amount of insurance
which the premium or consideration paid for the existing policy or con-
tract would have purchased at the age, nearest birthday, of the applicant
at the date of issue of such existing policy or contract.