28 Tex. Admin. Code § 4.624 - Provisions Relating to Dividends, Coupon Benefits, or Other Guaranteed Returns
(a) Any provision by
which the insurer undertakes to pay specific amounts will be treated as
definite contract benefits and valued in accordance with Insurance Code §
841.253, concerning
Life Insurance Company's Payment of Dividends.
(b) Any policy that contains a provision
promising to pay "dividends" from specified sources must clearly state that the
payment of such dividends must be made from profits or expense
loading.
(c) Any policy that
provides for the payment of dividends, coupon benefits, or other guaranteed
returns must specify the disposition that will be made of such accumulations if
no option is exercised by the policyholder either on their maturity or in the
event of default in premium payments. Acceptable dispositions are that they be:
(1) applied to the purchase of additional
insurance;
(2) left to accumulate
at interest;
(3) withdrawn in cash;
or
(4) applied to the payment of
premiums.
Notes
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