5 U.S.C. § 8711 — Basic tables of premium rates
submitted 60 years ago by Pub. L. 89-554 to r/title-5-GOVERNMENT-ORGANIZATION-AND-EMPLOYEES · 459 words · no verdicts yet
This section sets premium-rate tables and limits for group life and accidental-death-and-dismemberment policies.
(a) For the first policy year, a policy must include age-based group-life rates consistent with the lowest rates generally charged to large employers, and an accidental-death-and-dismemberment rate consistent with the lowest such rate. The life schedule is applied to the policy’s age distribution to find an average rate per $1,000. (b) First-year rates continue in later years unless adjusted from policy experience on a basis the Office approves in advance as consistent with large-employer group-insurance practice. (c) If actual age distribution would be too costly to determine, the Office may approve a tentative average rate. At the issuing company’s request, it must recalculate that rate during a year if experience shows its assumptions were wrong. (d) The policy must state first-year maximum expense and risk charges. The Office sets them consistently with large-employer practice. They continue unless the Office and issuer agree to a new amount or the Office gives at least one year’s written notice.
A policy purchased under this chapter shall include, for the first policy year, basic tables of premium rates as follows:
For group life insurance, a schedule of basic premium rates by age which the Office of Personnel Management determines to be consistent with the lowest schedule of basic premium rates generally charged for new group life insurance policies issued to large employers.
For group accidental death and dismemberment insurance, a basic premium rate which the Office determines is consistent with the lowest rate generally charged for new group accidental death and dismemberment policies issued to large employers.
The schedule for group life insurance, except as otherwise provided by this section, shall be applied to the distribution by age of the amounts of group life insurance under the policy at its date of issuance to determine an average basic premium rate per $1,000 of life insurance.
The policy shall provide that the basic premium rates determined for the first policy year continue for later policy years except as readjusted for a later year based on experience under the policy. The company issuing the policy may make the readjustment on a basis that the Office determines in advance of the policy year is consistent with the general practice of life insurance companies under policies of group life and group accidental death and dismemberment insurance issued to large employers.
The policy shall provide that if the Office determines that ascertaining the actual age distribution of the amounts of group life insurance in force at the date of issue of the policy or at the end of the first or any later year of insurance thereunder would not be possible except at a disproportionately high expense, the Office may approve the determination of a tentative average group life premium rate, for the first or any later policy year, instead of using the actual age distribution. The Office, on request by the company issuing the policy, shall redetermine the tentative average premium rate during any policy year, if experience indicates that the assumptions made in determining that rate were incorrect for that year.
The policy shall stipulate the maximum expense and risk charges for the first policy year. The Office shall determine these charges on a basis consistent with the general level of charges made by life insurance companies under policies of group life and accidental death and dismemberment insurance issued to large employers. The maximum charges continue from year to year, except that the Office may redetermine them for any year either by agreement with the company issuing the policy or on written notice given to the company at least 1 year before the beginning of the year for which the redetermined maximum charges will be effective.
Source credit: (Pub. L. 89–554, Sept. 6, 1966, 80 Stat. 597; Pub. L. 95–454, title IX, § 906(a)(2), (3), Oct. 13, 1978, 92 Stat. 1224.)
- 1966Enacted · Pub. L. 89-554 · 80 Stat. 597
- 1978Amended · Pub. L. 95-454 · 92 Stat. 1224
A history note hasn’t been published yet. The record shows enactment by Pub. L. 89-554 on 1966-09-06.
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