completing, equipping and furnishing said building or buildings until the amount therefor shall have been placed in the annual or supplemental appropriation bill, nor until the contract or contracts shall have been approved by the Governor. 5. This act shall take effect immediately. Approved April 15, 1907. CHAPTER 70. An Act to limit the capital stock, dividends and distribution of assets of stock life insurance companies. Be it enacted by the Senate and General Assembly of the State of New Jersey: limited. 1. No domestic life insurance company, so long as it Dividends continues to issue participating policies, shall pay in any year to its stockholders, out of earnings hereafter made, dividends aggregating more than ten per centum of the par value of their stock. capital. 2. No domestic life insurance company shall create Maximum or have shares of stock of a greater par value than two million dollars. Division of dissolution. assets after 3. Upon the dissolution of any domestic life insurance company having a stock capital, the assets remaining after satisfying all debts and all lawful obligations to policyholders and others, shall be divided among the stockholders in proportion to their shares, but no stockholder shall receive from said assets more than double the par value of his shares, and the residue of the assets, if any, shall be paid into the State treasury for the use of the State; provided, that in cases where the assets of Proviso. any such company have hertofore accumulated to such an extent that the net surplus belonging to stockholders is now in excess of double the par value of the stock, nothing in this act shall be construed to deprive the stockholders of any part of their share of such assets Proviso. heretofore accumulated, and in case of dissolution of the company they shall receive their full and lawful portion of such assets heretofore accumulated, notwithstanding that such portion may be more than double the par value of the shares; and provided further, that nothing herein contained shall prevent any such company from declaring any dividend it may deem proper to its policyholders out of its surplus earnings. Approved April 15, 1907. Ascertain Express use of surplus fund. CHAPTER 71. An Act to require an annual apportionment and accounting of surplus of life insurance companies. BE IT ENACTED by the Senate and General Assembly of the State of New Jersey: 1. Every domestic life insurance company doing business in this State, conducted on the mutual plan or in which policyholders are by the terms of their policies entitled to share in the profits or surplus shall, on all policies of life insurance heretofore or hereafter issued, under the conditions of which the distribution of surplus is deferred to a fixed or specified time and contingent upon the policy being in force and the insured living at that time, annually ascertain the amount of surplus to which all such policies as a separate class are entitled, and shall annually apportion to such policies as a class the amount of the surplus so ascertained, and carry the amount of such apportioned surplus, plus the actual interest earnings and accretions of such fund, as a distinct and separate liability to such class of policies on and for which the same was accumulated, and no company or any of its officers shall be permitted to use any part of such apportioned surplus fund for any purpose whatsoever other than for the express purpose for which the same was accumulated. 2. All acts and parts of acts inconsistent with the Repealer. provisions of this act are hereby repealed. Approved April 15, 1907. CHAPTER 72. A Supplement to an act entitled "An act to provide for the regulation and incorporation of insurance companies and to regulate the transaction of insurance business in this State," approved April third, nineteen hundred and two. BE IT ENACTED by the Senate and General Assembly of the State of New Jersey: 1. On and after the first day of January, nineteen hundred and eight, no policy of life insurance shall be issued by any domestic company or be issued or delivered within this State to any resident thereof by any foreign company, unless the same shall contain the following provisions: premiums. First. A provision that all premiums shall be payable Payment of in advance at the home office of the company, or to an agent of the company, upon delivery of a receipt signed by one or more of the officers who shall be named in the policy and countersigned by the agent; any policy may contain a provision that the policy itself shall be a receipt for the first premium. for payments. Second. A provision for one month's grace for the Month's grace payment of each premium after the first, subject to an interest charge, during which month the insurance shall continue in force, provided the overdue premium shall be paid within the said month. incontestable. Third. A provision that the policy shall constitute the When policy entire contract between the parties and that after a specified time, not later than two years from its date, shall be incontestable, except for non-payment of premiums and for violation of its express conditions, if any, re Special policy in hazardous cases. Policy to contract. lating to hazardous travel, residence or occupation, in which case the liability of the company may be limited to a definitely determinable reduced amount, which shall not be less than the full reserve for the policy and any dividend additions. A company may issue a special form of policy on the life of a person employed in an occupation or residing in a location classed by the company as hazardous or as liable to lead to hazardous employment or residence, which may provide that service in certain designated occupations or residence in certain designated localities shall reduce the company's liability under the policy to a definitely determinable amount not less than the full reserve for the policy and any dividend additions. Fourth. A provision that the policy shall contain the contain entire entire contract between the parties, and nothing shall be incorporated therein by reference to any constitution, by-laws, rules, application or other writing, unless the same are endorsed upon or attached to the policy when issued, and all statements purporting to be made by the insured shall, in the absence of fraud, be deemed representations and not warranties. Any waiver of this provision shall be void. If age understated. Policy to participate in surplus. Fifth. A provision that if the age of the insured has been understated the amount payable under the policy shall be such as the premium would have purchased at the correct age. Sixth. A provision that the policy shall participate in the surplus of the company, and that, beginning not later than the fifth policy year, the company will, at uniform intervals, not less than one nor more than five years, to be specified in the policy, determine and account for the portion of the divisible surplus accruing on the policy, and that the owner of the policy shall have the right to have the dividend arising from such participation paid in cash at the end of the then current policy year, provided no other dividend option given in the policy or in the dividend notice shall have been duly elected, and provided that no part of any yearly premium on said policy for the ensuing policy year remains unpaid. (The use of the last above proviso is optional with the company.) This sixth provision shall not be required in non- Exceptions. participating policies nor in policies issued on underaverage or sub-standard lives, nor in insurances issued or granted in exchange for lapsed or surrendered policies. policies. Seventh. A provision which, in event of default in Paid-up premium payments after premium shall have been paid for three years, shall secure to the owner of the policy a stipulated form of insurance, the net value of which shall be at least equal to the entire reserve held by the company on the policy (specifying the mortality table and rate of interest adopted for computing such reserve), less a specified percentage, not more than three (3) of the amount insured by the policy, including dividend additions thereto, if any, and less any outstanding indebtedness to the company on the policy. The specified percentage referred to above need not be stated for the policy years included in the table of surrender values required by this act. This provision shall not be required in term policies Exception. of twenty years or less. Eighth. A table showing in figures the loan value, if any, and the surrender values or options available under the policy each year upon default in premium payments, during at least the first twenty years of the policy, beginning with the year in which such values and options become available. Ninth. A provision that if, in event of default in premium payments, the value of the policy shall have been applied to the purchase of other insurance, and if such insurance shall be in force, and the original policy shall not have been surrendered to the company and canceled, the policy may be reinstated within three years from such default, upon evidence of insurability satisfactory to the company and payment of arrears of premiums. together with compound interest on such premiums and on all liens, if any. Loan and sur render values. Reinstatement of policy securing other insurance. after death. Tenth. A provision that when a policy shall become a Settlement claim by the death of the insured settlement shall be made either immediately upon, or within a specified period not more than two months after receipt of due proof of death. |