Nonforfeiture clause

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Nonforfeiture Clause

A clause in some insurance policies entitling a policyholder to receive the benefit, or a portion of it, for a short period of time after allowing the policy to lapse. That is, if the policyholder does not pay the premium as agreed, he/she is still entitled under a nonforfeiture clause to the benefit should the insured event occur within a certain, brief period of time. Alternatively, a nonforfeiture clause may entitle a policyholder to a partial refund of the premiums paid.

Nonforfeiture clause.

If there is a nonforfeiture clause in your insurance policy contract, and you have let the policy lapse because you haven't paid a premium that's due, you may qualify for the benefit named in the contract for a limited time, for a smaller benefit, or for a partial refund of your premium.

However, the added protection of adding a nonforfeiture clause generally increases the premium for the policy.

References in periodicals archive ?
Cash surrender value, or nonforfeiture value, is the sum of money an insurance company will pay a policyholder if he or she decides to cancel the policy before it expires or before he or she dies.
Adopting the new method requires amendments to state standard valuation and standard nonforfeiture laws for life insurance policies.
The CSO tables are smooth mortality tables used for conservative nonforfeiture value calculations for the protection of the insurer (a major concern of insurers and regulators) and do not anticipate extraordinary health changes in individuals but only anticipate aggregate group mortality change characteristics.
Needless to say, the above illustration is merely meant to show how wadi'ah works to provide for the nonforfeiture benefits.
The basic and diluted weighted average number of shares outstanding for the three and twelve months ended September 30, 2009 have been retroactively adjusted to reflect the adoption of new Earnings Per Share authoritative guidance requiring the inclusion of unvested share-based payment awards containing nonforfeiture rights to dividends or dividend equivalents in the calculation of basic weighted average number of shares outstanding.
challenged in court for violating ERISA nonforfeiture provisions, but
As a result, preneed insurance policies issued on or after January 1, 2009, and before January 1, 2012 can use the 2001 CSO Mortality tables that lists different mortality rates for men and women to determine the minimum standard for reserves and nonforfeiture benefits.
The nonforfeiture provision shall be appropriately captioned;
Contingent nonforfeiture benefit option provides a shortened benefit period if the policy lapses after three years due to nonpayment of contributions.
Among the improvements to the policies offered in California are the removal of the mental health exclusion from the Preferred Advantage product series, the revised nonforfeiture benefits that provide for a minimum nursing facility benefit after three years of premium payment, and the redefined simple and compound inflation computations.
Offer an optional nonforfeiture benefit, providing for some return on premiums paid or reduced benefits, even if the policyholder quits paying the premium after a minimum period of time.