408:19 General Contract Requirements for Annuities. –
Every annuity contract subject to this chapter shall comply with the following:
I. Payment of premiums. There shall be a provision relating to the time and place of payment of premiums.
II. Grace period. There shall be a provision that the contract holder is entitled to a grace period for the premium due, except the first, during which grace period the death benefit coverage shall continue in force, unless the contract holder gives the insurer written notice of discontinuance in advance of the date of discontinuance and in accordance with the terms of the contract. The contract may provide that the contract holder shall be liable to the insurer for the payment of a pro rata premium for the time the contract was in force during such grace period. The commissioner shall adopt rules to establish the length of the grace period.
III. Entire contract. There shall be a provision that the annuity contract, together with a copy of the signed and completed application, shall constitute the entire contract between the parties.
IV. Incontestability. A provision that the contract shall be incontestable by the insurer after it has been in force for 2 years during the lifetime of the insured. However, any increase in the amount of the contract's death benefits subsequent to the contract issue date, which occurred upon a new application or request of the owner and was subject to satisfactory proof of the insured's insurability, shall be incontestable after the increase has been in force, during the lifetime of the insured, for 2 years from the date of issue of increase.
V. Misstatement. If there is a misstatement of age or gender in the contract, the amount of the death benefit shall be that which would be purchased by the most recent mortality charge at the correct age or gender. The commissioner may approve other methods which are deemed satisfactory.