31A-22-402. Grace period -- Notification.

281 words·~1 min read·/ut/title-31a/chapter-22/31a-22-402

A research copy — for the controlling text, always check the official state or federal source. Not legal advice.

Effective 5/5/2021

(a)Every life insurance policy other than a group policy shall contain a provision entitling the policyholder to a grace period within which the payment of any premium may be made after the first payment of any premium.

(b)During the grace period described in Subsection (1)(a) , the policy continues in full force.

(2)The grace period required by Subsection

(1)may not be less than:

(a)31 days; or

(b)four weeks for policies whose premiums are payable more frequently than monthly.

(3)The insurer may impose an interest charge during the grace period not in excess of the interest rate:

(a)set by the policy for policy loans; or

(b)in the absence of a provision described in Subsection (3)(a) , a rate set by the commissioner by rule.

(4)If a claim arises under the policy during the grace period, an insurer may deduct from the policy proceeds:

(a)the amount of any premium due or overdue;

(b)interest at the rate provided in this section; and

(c)any deferred installment of the annual premium.

(a)At least 30 days before the day on which the insurer terminates coverage, the insurer shall send written notice of termination of coverage to:

(i)the policyholder's last-known address; and

(ii)a third party designated in accordance with Section 31A-22-430 .

(b)An insurer shall obtain and, upon request, demonstrate proof of delivery for a notice the insurer sends under Subsection (5)(a) .

(c)Proof of delivery described in Subsection (5)(b) may include a certified mail receipt or, for electronic delivery, a read receipt.

Amended by Chapter 221 , 2021 General Session