The following words and terms, when used in this subchapter,
shall have the following meanings unless the context clearly indicates
otherwise.
"Affiliate" means the term as defined in N.J.S.A.
17:27A-1a.
"Annuity" means the term as defined in
17B:17-5.
"Contract" means an annuity contract.
"Direct-response solicitation" means a solicitation through a
sponsoring or endorsing entity or individually solely through mail, telephone,
the Internet or other mass communication media.
"Existing insurer" means the insurance company whose policy
or contract is or shall be changed or affected in a manner described within the
definition of "replacement."
"Existing policy or contract" means an individual life
insurance policy or annuity contract in force, including a policy under a
binding or conditional receipt or a policy or contract, that is within an
unconditional refund period.
"Financed purchase" means the purchase of a new policy
involving the actual or intended use of funds obtained by the withdrawal or
surrender of, or by borrowing from values of, an existing policy to pay all or
part of any premium due on the new policy. For the purposes of a regulatory
review of an individual transaction only, if the proceeds from a withdrawal,
surrender or borrowing involving the policy values of an existing policy are
used to pay premiums on a new policy owned by the same policyholder and issued
by the same company within four months before and 13 months after the effective
date of the new policy, it will be deemed prima facie evidence of the
policyholder's intent to finance the purchase of the new policy with existing
policy values. This prima facie standard is not intended to increase or
decrease the monitoring obligations contained in
11:4-2.5(a)5.
"Illustration" means a presentation or depiction that
includes non-guaranteed elements of a policy of life insurance over a period of
years as defined at N.J.A.C. 11:4-5.2.
"Life insurance" means the term as defined at
17B:17-3.
"Policy" means a life insurance policy.
"Policy summary" means:
1. For policies or contracts other than universal life
policies, a written statement regarding a policy or contract that shall contain
to the extent applicable, but need not be limited to, the following
information:
i. Current death benefit;
ii. Annual contract premium;
iii. Current cash surrender value;
iv. Current dividend;
v. Application of current dividend; and
vi. Amount of outstanding loan;
2. For universal life policies, a written statement that
shall contain at least the following information:
i. The beginning and end date of the current report
period;
ii. The policy value at the end of the previous report period
and at the end of the current report period;
iii. The total amounts that have been credited or debited to
the policy value during the current report period, identifying each by type
(for example, interest, mortality, expense and riders);
iv. The current death benefit at the end of the current
report period on each life covered by the policy;
v. The net cash surrender value of the policy as of the end
of the current report period; and
vi. The amount of outstanding loans, if any, as of the end of
the current report period.
"Insurance producer" means a person required to be licensed
under the laws of this State to sell, solicit or negotiate insurance pursuant
to 17:22A-28.
"Registered contract" means a variable annuity contract or
variable life insurance policy subject to the prospectus delivery requirements
of the Federal Securities Act of 1933,
15
U.S.C. §§
77a et seq.
"Replacement" means a transaction in which a new policy or
contract is to be purchased, and it is known or should be known to the
proposing producer, or to the proposing insurer if there is no producer, that
by reason of the transaction, an existing policy or contract has been or is to
be:
1. Lapsed, forfeited, surrendered or partially surrendered,
assigned to the replacing insurer or otherwise terminated;
2. Converted to reduced paid-up insurance, continued as
extended term insurance, or otherwise reduced in value by the use of
nonforfeiture benefits or other policy values;
3. Amended so as to effect either a reduction in benefits or
in the term for which coverage would otherwise remain in force or for which
benefits would be paid;
4. Reissued with any reduction in cash value; or
5. Used in a financed purchase.
"Replacing insurer" means the insurance company that issues
or proposes to issue a new policy or contract that replaces an existing policy
or contract or is a financed purchase.
"Sales material" means a sales illustration and any other
written, printed or electronically presented information created or completed
or provided by the company or producer and used in any presentation made to the
policy or contract owner related to the policy or contract purchased.
