Policy Split Option definition

Policy Split Option means the “Policy Split Option” as set out in Provision E.

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Policy Split Option. This is an automatic rider on policies where both insureds are less than 80 years old. The rider allows a joint policy to be exchanged for two individual policies if certain changes in the estate tax law are made. There are no reinsurance premiums for the rider itself. If the policy split occurs, reinsurance premiums for the resulting single life policies will be equal to the underlying single life rates of the base plan, assessed point-in-scale: Enhanced Policy Split Option: Same as Policy Split Option, but no medical evidence of insurability is required if both insured are standard risks.

Examples of Policy Split Option in a sentence

• Enhanced Policy Split Option Rider (R94-EPSO, R96-EPSO and R03-ESO): This rider provides owners of a JLS policy the option to split the policy into single life policies.

• The Policy Split Option will terminate at the earlier of the eldest insured’s attained age of 80, and the base policy’s termination.

• Reinsurance premiums for single life policies, which result from the Policy Split Option having been exercised, will reflect the original issue age and underwriting class of the insured, as well as the duration since issuance of the original policy.

• Enhanced Policy Split Option Rider (R17-ESO): This rider provides owners of a JLS policy the option to split the policy into single life policies.

• Prior to Invocation, this Rider will not affect the Policy Split Option Rider.

• After this Rider is invoked, the policy Owner will no longer be eligible for Policy Split Option benefits and the Policy Split Option Rider will terminate.

• The net amount at risk and the reinsured net amount at risk for policies resulting from exercise of the Policy Split Option will be determined in the same manner.

• When the Policy Split Option is exercised, the reinsurance premium rates for the resulting single life policies will be the single life reinsurance premium rates (75-80 SOA ALB Table) attached as Schedule A—VI, applied on a point-in-scale basis, for the reinsured portion of the policy, multiplied by a Single Life Discount Factor, attached as Schedule A—VII.

• Riders that are covered under this Agreement are: Individual Term Rider, Estate Term Rider, Policy Split Option, Conditional Exchange Option Rider, Life Plan Option Rider, Cost of Living Rider, Purchase Protector Plan, Guaranteed Death Benefit Rider, Credit of Specified Amount upon Death of Covered Insured Rider, Four Year Survivorship Term Rider, Four Year Term Rider, Extended Maturity Riders.

• Policy Split Option - If this option is exercised, the Ceding Company will retain its available single life Maximum Limits of Retention on each life, as set out in Exhibit 2, and cede the remaining, if any, to the Reinsurance Pool.