N.J. Stat. tit. 17B, ch. 17

in effect

N.J. Stat. § 17B:17-1 Scope of act

This Subtitle 3 of Title 17B shall be known as the "Life and Health Insurance Code," sometimes referred to herein as this "Code," and shall have application only to life insurance, health insurance and annuities as herein defined. No part of Subtitle 3 of Title 17 and no other part of Title 17B as they now exist or may hereafter be constituted shall have any application to such insurance or annuities unless specifically otherwise provided in the act enacting this Code or in an act enacted subsequent to such act. a. Any insurance company, domestic, alien or foreign, now or hereafter organized which in addition to doing the business of health insurance as defined in section 17B:17-4, is licensed to make, or shall hereafter become licensed to make, kinds of insurance other than those defined hereinafter in this chapter, shall be subject only to the hereinafter enumerated provisions of this Code but only in connection with such health insurance business: (1) All the provisions of the following chapters: Chapters 22, 26, 29, 34 and 35. (2) All the provisions of the following sections: 17B:17-1, 17B:17-2, 17B:17-4, and 17B:17-6 through 17B:17-14; 17B:18-1, 17B:18-35 through 17B:18-40, 17B:18-63, 17B:18-66; 17B:19-5; 17B:24-1 through 17B:24-5, 17B:24-8 and 17B:24-9; (3) All of the provisions of the following articles of the designated chapter. Articles 2 and 3 of Chapter 27. b. The provisions of the following chapters and sections shall not be applicable to those insurance companies described in subsection "a" above: (1) Chapters 21, 23, 30 and 33. (2) 17B:18-41, 17B:18-42, 17B:18-47, 17B:18-56, 17B:18-57, 17B:18-58, 17B:18-64, 17B:18-65 and 17B:19-1. All such companies will remain subject to subtitle 3 of Title 17 except as above provided. c. Any insurer now licensed under R.S. 17:17-1, d. solely to do the business of health insurance shall be subject to every provision of this Code as a health insurer. d. An insurer may be organized under the provisions of section 17B:18-4 to do the business of health insurance as defined in section 17B:17-4 and in addition kinds of insurance other than those kinds defined in this chapter, and in such case, it shall have all the obligations, powers and privileges of a health insurer organized under this Code and shall to the extent not inconsistent herewith be subject to all the provisions of Subtitle 3 of Title 17. e. Except as otherwise specifically provided no provision of this Code shall apply to: (1) Fraternal benefit societies as defined in Part 5A of Subtitle 3 of Title 17. (2) Mutual benefit associations as defined in Part 6 of Subtitle 3 of Title 17. (3) Hospital and medical service corporations as defined in Part 9 of Subtitle 3 of Title 17. L.1971, c. 144, s. 17B:17-1.

N.J. Stat. § 17B:17-2 Insurer defined

"Insurer" includes every person engaged as indemnitor or contractor in the business of life insurance, health insurance or of annuity. L.1971, c. 144, s. 17B:17-2.

N.J. Stat. § 17B:17-3 Life insurance defined

"Life insurance" is a policy or contract whereby an insurer is obligated to pay or allow a benefit of pecuniary value with respect to the cessation of human life. Life insurance includes also the granting of endowment benefits and optional modes of settlement of proceeds of life insurance as well as provisions for a. additional benefits in event of death by accident or accidental means or in event of dismemberment or loss of sight, or b. safeguarding such insurance against lapse or giving a special surrender value or special benefit or an annuity in the event that the insured shall become totally and permanently disabled, whether such provisions are incorporated in a policy or contract of life insurance or in a policy or contract supplemental thereto. Life insurance does not include workmen's compensation coverages. L.1971, c. 144, s. 17B:17-3.

N.J. Stat. § 17B:17-4 Health insurance defined

"Health insurance" is a contract or agreement whereby an insurer is obligated to pay or allow a benefit of pecuniary value with respect to the bodily injury, disablement, sickness, death by accident or accidental means of a human being, or because of any expense relating thereto, or because of any expense incurred in prevention of sickness, and includes every risk pertaining to any of the enumerated risks. Health insurance does not include workmen's compensation coverages. L.1971, c. 144, s. 17B:17-4.

N.J. Stat. § 17B:17-5 Annuity defined

"Annuity" is a contract not coming within the definition of life insurance as set forth in section 17B:17-3, or health insurance as set forth in section 17B:17-4, under which an insurer obligates itself to make periodic payments for a specified period of time, such as for a number of years, or until the happening of an event, or for life, or for a period of time determined by any combination thereof. Such a contract which includes extra benefits of the kinds set forth in sections 17B:17-3 or 17B:17-4 shall nevertheless be deemed to be an annuity if such extra benefits constitute a subsidiary or incidental part of the entire contract. L.1971, c. 144, s. 17B:17-5.

N.J. Stat. § 17B:17-5.1 Definitions; funeral insurance policies

24. a. As used in this section: "At need funeral arrangements" means funeral arrangements made with the survivors or personal representative of a person who has already died for that person's funeral. "Funeral arrangements" means funeral and burial plans made through a mortuary, including the selection of plans for the furnishing of funeral goods and services pursuant to a completed plan of bodily disposition and the act of offering the opportunity to purchase or to enroll in a prepaid funeral agreement by the mortuary. "Funeral insurance policy" means any insurance policy or annuity contract that, at the time of issue, was intended to provide, or which was explicitly marketed for the purpose of providing, funds to the provider, whether directly or indirectly, at the time of the insured's death in connection with a prepaid funeral agreement. "Intended funeral recipient" means the person named in a prepaid funeral agreement for whose bodily disposition the prepaid funeral agreement is intended to provide. The intended funeral recipient may or may not be the purchaser. "Preneed funeral arrangements" means funeral arrangements made with an intended funeral recipient or his guardian, agent or next of kin, for the funeral of the intended funeral recipient. "Prepaid funeral agreement" means a written agreement and all documents related thereto made by a purchaser with a provider prior to the death of the intended funeral recipient, with which there is connected a provisional means of paying for preneed funeral arrangements upon the death of the intended funeral recipient by the use of a funeral trust or funeral insurance policy, made payable to a provider and in return for which the provider promises to furnish, make available or provide the prepaid funeral goods or services, or both, specified in the agreement, the delivery of which occurs after the death of the intended funeral recipient. "Prepaid funeral goods" means personal property typically sold or provided in connection with a funeral, or the final disposition of human remains, including, but not limited to, caskets or other primary containers, cremation or transportation containers, outer burial containers, vaults, as defined in N.J.S.8A:1-2, memorials as defined in N.J.S.8A:1-2, funeral clothing or accessories, monuments, cremation urns, and similar funeral or burial items, which goods are purchased in advance of need and which will not be delivered until the death of the intended funeral recipient named in a prepaid funeral agreement. Prepaid funeral goods shall not mean the sale of interment spaces and related personal property offered or sold by a cemetery company as provided for in N.J.S.8A:1-1 et seq. "Prepaid funeral services" means those services typically provided in connection with a funeral, or the final disposition of human remains, including, but not limited to, funeral directing services, embalming services, care of human remains, preparation of human remains for final disposition, transportation of human remains, use of facilities or equipment for viewing human remains, visitation, memorial services or services which are used in connection with a funeral or the disposition of human remains, coordinating or conducting funeral rites or ceremonies and similar funeral or burial services, including limousine services provided in connection therewith, which services are purchased in advance of need and which will not be provided or delivered until the death of the intended funeral recipient named in a prepaid funeral agreement. Prepaid funeral services shall not mean the sale of services incidental to the provision of interment spaces or any related personal services offered or sold by a cemetery company as provided for in N.J.S.8A:1-1 et seq. "Provider" means a person, firm or corporation duly licensed and registered pursuant to the "Mortuary Science Act," P.L.1952, c.340 (C.45:7-32 et seq.) to engage in the business and practice of funeral directing or mortuary science, or an individual serving as an agent thereof and so licensed: (1) Operating a duly registered mortuary in accordance with P.L.1952, c.340 (C.45:7-32 et seq.) and the regulations promulgated thereunder; (2) Having his or its business and practice based within the physical confines of the registered mortuary; and (3) Engaging in the practice of making preneed funeral arrangements, including, but not limited to, offering the opportunity to purchase or enroll in prepaid funeral agreements. "Purchaser" means the person named in a prepaid funeral agreement who purchases the prepaid funeral goods and services to be provided thereunder. The purchaser may or may not be the intended funeral recipient. If the purchaser is different than the intended funeral recipient, it is understood that the relationship of the purchaser to the intended funeral recipient includes a means to provide administrative control over the agreement on behalf of the intended funeral recipient. b. The issuance and marketing of any funeral insurance policy shall meet all of the terms and conditions specified by the Department of Insurance as would apply to any life insurance or annuity contract, and shall in addition meet the standards and requirements specified in sections 1 through 13 of P.L.1993, c.147 (C.45:7-82 to 45:7-94). c. Any insurance policy or annuity contract used as a funeral insurance policy on or after the effective date of P.L.1993, c.147 (C.45:7-82 et al.), whether issued within the State or outside of the State, whether on a group or individual basis, and any certificates, policies, contracts, applications, forms and related material, shall be subject to all the laws and regulations of this State and the terms and conditions of the Department of Insurance, as though issued in this State, and shall at the time of filing be designated as being intended for use as a funeral insurance policy. d. The Commissioner of Insurance shall adopt rules and regulations to implement the provisions of this section, including a regulation establishing the loss ratio for funeral insurance policies. L.1993,c.147,s.24.

N.J. Stat. § 17B:17-6 Person defined

"Person" includes any individual, insurer, company, association, organization, society, partnership, syndicate, trust, business trust, corporation and every legal entity. L.1971, c. 144, s. 17B:17-6.

N.J. Stat. § 17B:17-7 Domestic insurer, foreign insurer, alien insurer defined

a. A "domestic" insurer is one formed under the laws of this State. b. A "foreign" insurer is one formed under the laws of a jurisdiction of the United States of America other than this State. c. An "alien" insurer is one formed under the laws of any country other than the United States of America, its States, districts, territories, commonwealths, possessions and the Panama Canal Zone. L.1971, c. 144, s. 17B:17-7.

N.J. Stat. § 17B:17-8 State defined

When used in context signifying a jurisdiction other than the State of New Jersey, "State" means any State, district, territory, commonwealth, or possession of the United States of America, and the Panama Canal Zone. L.1971, c. 144, s. 17B:17-8.

N.J. Stat. § 17B:17-9 Domicile defined

The "domicile" of an insurer means: a. As to Canadian insurers, the province in which the insurer's head office is located. b. As to other alien insurers authorized to transact insurance in one or more States, as provided in section 17B:23-5c. c. As to alien insurers not authorized to transact insurance in one or more States, the country under the laws of which the insurer was formed. d. As to all other insurers, the State under the laws of which the insurer was formed. L.1971, c. 144, s. 17B:17-9.

N.J. Stat. § 17B:17-10 Principal office defined

"Principal office" means: a. As to Canadian insurers, the office in Canada from which the general affairs of the insurer are directed or managed. b. As to other alien insurers authorized to transact insurance in one or more States, the office in the United States from which the general affairs of the insurer in the United States are directed or managed. c. As to all other insurers, the office from which the general affairs of the insurer are directed or managed. L.1971, c. 144, s. 17B:17-10.

N.J. Stat. § 17B:17-11 Authorized insurer, unauthorized insurer defined

a. An "authorized insurer" is one duly authorized by a current certificate of authority issued by the commissioner pursuant to this code to act as an insurer in this State. b. An "unauthorized insurer" is an insurer not so authorized. L.1971, c. 144, s. 17B:17-11.

N.J. Stat. § 17B:17-12 Certificate of authority; license defined

a. A "certificate of authority is a certificate issued by the commissioner evidencing the authority of an insurer to transact insurance in this State. b. A "license" is authority granted by the commissioner pursuant to this code authorizing the licensee to engage in a business or operation of insurance in this State as an agent, broker, or solicitor, as the case may be, and the written evidence of such authority. L.1971,c.144.

N.J. Stat. § 17B:17-12.1 Change of domicile for insurers

2. a. An insurer that is formed under the laws of another state and is admitted to transact the business of insurance in this State may become a domestic insurer upon the commissioner's determination that the company has complied with all applicable requirements of Title 17B of the New Jersey Statutes relating to the formation of a domestic insurer of the same type. If the commissioner approves the domestication of a foreign insurer pursuant to this section, the insurer shall be entitled to a certificate of authority equivalent to that which was previously held as a foreign insurer and the insurer shall be subject to the authority and jurisdiction of this State. The newly domesticated insurer shall amend its articles of incorporation to provide that the corporation is a continuation of the corporate existence of the original foreign corporation through the adoption of this State as its corporate domicile, and that the original date of incorporation in its original domiciliary state is the date of incorporation of such domestic insurer. For purposes of the premium tax laws, pursuant to P.L.1945, c.132 (C.54:18A-1 et seq.), however, the date of licensure shall be the date on which the commissioner approves the domestication in this State. b. Any domestic insurer may, upon the written approval of the commissioner, transfer its domicile to any other state in which it is admitted to transact the business of insurance. The company shall cease to be a domestic insurer as of the effective date of the transfer approved by the commissioner. Such a company shall be admitted to transact the business of insurance in this State if the company is otherwise qualified as a foreign insurer pursuant to the applicable requirements of Title 17B of the New Jersey Statutes. c. Every insurer authorized to transact business in the State shall notify the commissioner of the details of any proposed transfer of domicile at least 60 days prior to the effective date of the proposed transfer, however, the commissioner may approve a shorter period for providing such notice. Such an insurer shall file promptly any resulting amendments to corporate documents filed or required to be filed with the commissioner. d. Prior to granting approval for any foreign insurer to become a domestic insurer, or for a domestic insurer to transfer its domicile to another state, the commissioner may conduct whatever investigations, examinations or hearings he deems necessary, and may subject the issuance of his approval to the conditions and restrictions that he determines are reasonable and necessary for the protection of the company's policyholders or the public. e. The transfer of domicile of an insurer pursuant to the provisions of this section shall not be construed to alter either the existing rights, franchises and interests, or the duties, obligations and liabilities of the insurer transferring domicile, except as otherwise provided by law. Insurers who transfer domicile shall continue to be subject to all the liabilities, claims and demands against the company which were in existence prior to the transfer of domicile. Any action or proceeding pending at the time of the consummation of the process by which the domicile is transferred in which the company is a party shall not abate or discontinue by reason of the transfer of domicile, but shall be prosecuted to a final resolution in the same manner as if the transfer of domicile had not taken place. f. The certificate of authority, insurance producer appointments and licenses, rating systems and other documents required to be maintained for regulatory purposes, which are in existence and approved for use in this State at the time any insurer licensed to transact the business of insurance in this State transfers its corporate domicile to this or any other state by merger, consolidation, transfer, or any other lawful method, shall continue in full force and effect upon such transfer if the commissioner is satisfied that the insurer remains duly qualified to transact the business of insurance in this State. All outstanding policies of any transferring insurer shall remain in full force and effect and need not be endorsed as to the new name of the company or its new location unless so ordered by the commissioner. To the extent required by law, every transferring insurer shall file new policy forms with the commissioner on or before the effective date of the transfer, but may use existing policy forms with appropriate endorsements if allowed by, and under such conditions as approved by, the commissioner. L.1994,c.189,s.2.

N.J. Stat. § 17B:17-13 Misdemeanor to do business unless authorized

a. No person shall act as an insurer in this State without complying with the applicable provisions of this Code. b. No person by himself, or by his brokers, agents, solicitors, surveyors, canvassers or other representatives of whatever designation, nor any such broker, agent, solicitor, surveyor, canvasser, or other representative, shall solicit, negotiate or effect any contract of insurance of any kind or sign, deliver or transmit, by mail or otherwise, any policy or annuity contract or receive any premium, commission, fee or other payment thereon, or maintain or operate any office in this State for the transaction of the business of insurance, or in any manner, directly or indirectly, transact the business of insurance of any kind whatsoever, within this State, unless specifically authorized under the laws of this State. c. Specific authorization under the laws of this State shall not be required with respect to the following: (1) Investigation, settlement, or litigation of claims under an insurer's policies lawfully written in this State, or liquidation of such insurer's assets and liabilities (other than the collection of new premiums) all as resulting from its former authorized operation in this State. (2) Transactions involving a policy subsequent to issuance thereof lawfully solicited, written, or delivered outside this State. (3) Reinsurance when transacted as authorized under section 17B:18-62. (4) The continuation and servicing of life or health insurance policies or annuity contracts remaining in force as to residents of this State when the insurer is not transacting new insurance therein. (5) Group life or health insurance or annuity contracts covering residents of this State under a group policy or contract lawfully issued in another State. d. Any person violating any of the provisions of this section shall be guilty of a misdemeanor. L.1971, c. 144, s. 17B:17-13.

N.J. Stat. § 17B:17-13.1 Charitable annuities.

17B:17-13.1. a. The commissioner may, in his discretion, issue a special permit to a qualified nonprofit domestic or foreign corporation or association organized without capital stock or not for profit, engaged solely in bona fide charitable, religious, missionary, educational or philanthropic activities and which shall have been in active operation for at least ten years authorizing any such corporation or association to enter into annuity agreements with donors. Before issuing any such special permit the commissioner shall promulgate rules and regulations governing such annuity agreements and permit holders with respect to such annuity agreements. Such rules and regulations shall, in addition to such other provisions as the commissioner may determine to be necessary or desirable to protect the public, provide that each applicant for a special permit shall submit to the commissioner copies of its form of agreements with donors, and a schedule of its maximum annuity rates, which rates shall be so computed, on the basis of the standard valuation law, as to return to the special permit holder, upon the death of the annuitant, a residue at least equal to one-half of the original gift or other consideration for such annuity. b. Each such special permit holder shall have and maintain segregated assets at least equal to the sum of the reserves on its outstanding agreements calculated in accordance with the provisions of Chapter 19 of this Code, and a surplus of ten per centum of such reserves or the amount of $100,000, whichever is higher, and such assets shall be segregated as separate and distinct funds, independent of all other funds of such special permit holder and shall not be applied for the payment of the debts and obligations of the special permit holder other than with respect to annuity agreements. In determining the reserves of any such special permit holder, a deduction shall be made for all or any portion of an annuity risk which is lawfully reinsured by an authorized insurer. Segregated assets herein required to be maintained shall be invested in accordance with the provisions of the "Prudent Investor Act," P.L.1997, c.26 (C.3B:20-11.1 et seq.). c. Any corporation or association defined in subsection a. hereof which, prior to the effective date of this Code, has entered into annuity agreements shall obtain a special permit as herein provided prior to entering into any new or additional annuity agreements provided, however, that the commissioner shall by regulation allow a period of time, which shall not be more than five years following the effective date of this Code for any such corporation or association to comply with the provisions of subsection b. of this section with respect to any annuity agreement entered into prior to the effective date of this Code. The commissioner, in his discretion may extend such time for a reasonable period. d. If the commissioner finds that any special permit holder has failed to comply with the requirements of this section or of any rule or regulation of the commissioner issued hereunder, he may by appropriate order, subject to the provisions of the Administrative Procedure Act (P.L.1968, c.410), Chapter 34 of this Code and any rules adopted thereunder suspend or revoke any such special permit and he may take such other action to restrain or enjoin any such violation as may be otherwise provided by law. In addition the commissioner may make such orders as he deems desirable and necessary to afford appropriate financial security to the annuitants. The commissioner may require that special permit holders submit periodically such reports as he may deem desirable or necessary to ascertain compliance with requirements of this section and the commissioner may, whenever he deems it expedient, make or cause to be made an examination of the assets and liabilities and other affairs of any such special permit holder as the same pertains to annuity agreements entered into pursuant to this section. The reasonable expenses of any such examination shall be fixed and determined by the commissioner, and he shall collect them from the special permit holder examined, who shall pay them on presentation of a detailed account of the expenses. e. No special permit holder shall be deemed an insurer as defined in this Code. L.1971, c.144, s.17B:17-13.1; amended 2003, c.230.

N.J. Stat. § 17B:17-14 General penalty

Each violation of this Code as to which a penalty is not provided by another provision of this Code or by other applicable laws of this State shall be a misdemeanor, and may in addition to any prescribed applicable denial, suspension, or revocation of certificate of authority, license, or permit be punishable upon conviction in the manner prescribed for misdemeanors under the provisions of Title 2A of the statutes of this State. Each instance of such violation may be considered a separate offense. L.1971, c. 144, s. 17B:17-14.

N.J. Stat. § 17B:17-15 Conflict with other laws

All laws and parts of laws of this State inconsistent with this Code are hereby superseded with respect to matters covered by this Code. L.1971, c. 144, s. 17B:17-15.

N.J. Stat. § 17B:17-16 Separability of provisions

If any provision of this Code or the application thereof to any person or circumstance is held invalid, the invalidity shall not affect other provisions or applications of this Code which can be given effect without the invalid provision or application, and for this purpose the provisions of the Code are separable. L.1971, c. 144, s. 17B:17-16.

N.J. Stat. § 17B:17-17 Short title

This act shall be known and may be cited as the "Life and Health Insurance Policy Language Simplification Act." L.1979, c. 167, s. 1, eff. Aug. 6, 1979.

N.J. Stat. § 17B:17-18 Purpose

The purpose of this act is to establish minimum standards for language used in policies, contracts and certificates of life insurance, health insurance, annuity, credit life insurance and credit health insurance, delivered or issued for delivery in this State, to facilitate ease of reading by insureds. This act is not intended to increase the risk assumed by insurance companies or other entities subject to this act or to supersede their obligation to comply with the substance of other insurance legislation applicable to life, health, credit life or credit health insurance or annuity policies. This act is not intended to impede flexibility and innovation in the development of policy forms or content or to lead to the standardization of policy forms or content. L.1979, c. 167, s. 2, eff. Aug. 6, 1979.

N.J. Stat. § 17B:17-19 Definitions

As used in this act: a. "Policy" or "policy form" means any policy, contract, certificate, or agreement of life or health insurance, including credit life insurance and credit health insurance, or annuity, delivered or issued for delivery in this State by any company subject to this act; any certificate, contract, or policy issued by a fraternal benefit society; and any certificate issued pursuant to a group insurance policy delivered or issued for delivery in this State. b. "Company" or "insurer" means any life or health insurance company, fraternal benefit society, nonprofit health service corporation, nonprofit hospital service corporation, nonprofit medical service corporation, nonprofit dental service corporation, mutual benefit association, and all similar type organizations. c. "Commissioner" means the Commissioner of Insurance. L.1979, c. 167, s. 3, eff. Aug. 6, 1979.

N.J. Stat. § 17B:17-20 Application of act; exclusions

a. This act shall apply to all policies delivered or issued for delivery in this State by any company on or after the dates such forms must be filed or approved under this act, but nothing in this act shall apply to: (1) Any policy which is a security subject to Federal jurisdiction; (2) Any group policy covering a group of 50 or more lives at date of issue, other than a group credit life insurance policy or a group credit health insurance policy; however, this shall not exempt any certificate issued pursuant to a group policy delivered or issued for delivery in this State; (3) Any group annuity contract which serves as a funding vehicle for pension, profit-sharing, or deferred compensation plans; (4) Any form used in connection with, as a conversion from, as an addition to, or in exchange pursuant to a contractual provision for, a policy delivered or issued for delivery on a form filed, approved or permitted to be issued prior to the dates such forms must be filed or approved under this act; or (5) The renewal of a policy delivered or issued for delivery prior to the dates such forms must be filed or approved under this act. b. No other law of this State setting language simplification standards shall apply to any policy form. c. Any non-English language policy delivered or issued for delivery in this State shall be deemed to be in compliance with this act if the insurer certifies that such policy is translated from an English language policy which does comply with this act. L.1979, c. 167, s. 4, eff. Aug. 6, 1979.

N.J. Stat. § 17B:17-21 Policy forms

a. In addition to any other requirements of law, no policy forms, except as stated in section 4, shall be delivered or issued for delivery in this State on or after the dates such forms must be filed or approved under this act, unless: (1) The text achieves a minimum score of 40 on the Flesch reading ease test or an equivalent score on any other comparable test as provided in subsection c. of this section; (2) It is printed, except for specification pages, schedules and tables, in not less than ten point type, one point leaded; (3) The style, arrangement, and overall appearance of the policy give no undue prominence to any portion of the text of the policy or to any endorsements or riders; and (4) It contains a table of contents or an index of the principal sections of the policy, if the policy has more than 3,000 words printed on three or fewer pages of text, or if the policy has more than three pages regardless of the number of words. b. For the purposes of this section, a Flesch reading ease test score shall be measured by the following method: (1) For policy forms containing 10,000 words or less of text, the entire form shall be analyzed. For policy forms containing more than 10,000 words, the readability of two 200 words samples per page may be analyzed instead of the entire form. The samples shall be separated by at least 20 printed lines. (2) The number of words and sentences in the text shall be counted and the total number of words divided by the total number of sentences. The figure obtained shall be multiplied by a factor of 1.015. (3) The total number of syllables shall be counted and divided by the total number of words. The figure obtained shall be multiplied by a factor of 84.6. (4) The sum of the figures computed under paragraphs (2) and (3) subtracted from 206.835 equals the Flesch reading ease score for the policy form. (5) For purposes of paragraphs (2), (3), and (4), the following procedures shall be used: (a) A contraction, hyphenated word, or numbers and letters, when separated by spaces, shall be counted as one word; (b) A unit of words ending with a period, semicolon, or colon, but excluding headings and captions, shall be counted as a sentence; and (c) A syllable means a unit of spoken language consisting of one or more letters of a word as divided by an accepted dictionary. Where the dictionary shows two or more equally acceptable pronunciations of a word, the pronunciation containing fewer syllables shall be used. (6) The term "text" as used in this section shall include all printed matter except the following: (a) The name and address of the insurer; the name, number, or title of the policy; the table of contents or index; captions and subcaptions; specification pages, schedules, or tables; and (b) Any policy language which is drafted to conform to the requirements of any Federal law, regulation, or agency interpretation; any policy language required by any collectively bargained agreement; any medical terminology; any words which are defined in the policy; and any policy language required by law or regulation; provided, however, the insurer identifies the language or terminology excepted by this subparagraph (b) and certifies, in writing, that the language or terminology is entitled to be excepted by subparagraph (b). c. Any other reading test may be approved by the commissioner for use as an alternative to the Flesch reading ease test if it is comparable in result to the Flesch reading ease test. d. Filings subject to this section shall be accompanied by a certificate signed by an officer of the insurer stating that it meets the minimum reading ease score on the test used or stating that the score is lower than the minimum required but should be approved in accordance with section 7 of this act. To confirm the accuracy of any certification, the commissioner may require the submission of further information to verify the certification in question. e. At the option of the insurer, riders, endorsements, applications, and other forms made a part of the policy may be scored as separate forms or as part of the policy with which they may be used. L.1979, c. 167, s. 5, eff. Aug. 6, 1979.

N.J. Stat. § 17B:17-22 Issuance of policy forms after filing; construction with other laws

Nothing in this act shall be construed to negate any law of this State permitting the issuance of any policy form after it has been on file for the time period specified. L.1979, c. 167, s. 6, eff. Aug. 6, 1979.

N.J. Stat. § 17B:17-23 Flesch reading ease score; authorization of lower score

The commissioner may authorize a lower score than the Flesch reading ease score required in section 5a. (1) whenever, in his sole discretion, he finds that a lower score: a. will provide a more accurate reflection of the readability of a policy form; b. is warranted by the nature of a particular policy form or type or class of policy forms; or c. is caused by certain policy language which is drafted to conform to the requirements of any State law, regulation, or agency interpretation. L.1979, c. 167, s. 7, eff. Aug. 6, 1979.

N.J. Stat. § 17B:17-24 Content of policy forms; construction with other laws

A policy form meeting the requirements of section 5a. shall be filed or approved notwithstanding the provisions of any other law which specifies the content of policies, if the policy form provides the policyholders and claimants protection no less favorable than they would be entitled to under such law. L.1979, c. 167, s. 8, eff. Aug. 6, 1979.

N.J. Stat. § 17B:17-25 Date of application

a. Except as provided in section 4, this act applies to all policy forms filed on or after 2 years after the effective date of this act. No policy form shall be delivered or issued for delivery in this State on or after 5 years after the effective date of this act unless filed or approved by the commissioner or permitted to be issued under this act. Any policy form which has been filed or approved or permitted to be issued prior to 5 years after the effective date of this act and which meets the standards set by this act need not be resubmitted for filing or approval but may continue to be lawfully delivered or issued for delivery in this State upon the filing with the commissioner of a list of such forms identified by form number and accompanied by a certificate as to each such form in the manner provided in section 5d. b. The commissioner may, in his sole discretion, extend the dates in subsection a. of this section. L.1979, c. 167, s. 9, eff. Aug. 6, 1979.

N.J. Stat. § 17B:17-26 Definitions relative to life insurance.

1. As used in this act: "Account" means any mechanism, whether denoted as a retained asset account or otherwise, whereby the settlement of proceeds payable to a beneficiary under a policy is accomplished by the insurer or an entity acting on behalf of the insurer where the proceeds are retained by the insurer pursuant to a supplementary contract not involving annuity benefits other than death benefits. "Commissioner" means the Commissioner of Banking and Insurance. "Death index" means the death master file maintained by the United States Social Security Administration or any other database or service that is at least as comprehensive as the death master file maintained by the United States Social Security Administration and that is acceptable to the commissioner. "Insured" means an individual covered by a policy or an annuitant when the annuity contract provides for benefits to be paid or other monies to be distributed upon the death of the annuitant. "Insurer" means a life insurance company or fraternal benefit society that is required to file an annual financial audit pursuant to N.J.A.C.11:2-26.4. "Policy" means a life insurance policy, an annuity contract, a certificate under a life insurance policy, or a certificate issued by a fraternal benefit society, under which benefits are to be paid upon the death of the insured, and which is issued on or after the effective date of this act. L.2017, c.236, s.1.

N.J. Stat. § 17B:17-27 Applicability of act.

2. a. This act shall apply to: (1) every policy issued by a domestic insurer in this State and any account established under or as a result of that policy; and (2) every policy delivered or issued for delivery in New Jersey by an authorized foreign insurer and any account established under or as a result of that policy. b. Notwithstanding subsection a. of this section, with respect to a policy delivered or issued for delivery outside this State, a domestic insurer may, in lieu of the requirements of this act, implement procedures that meet the minimum requirements of the state in which the policy was delivered or issued, provided that the commissioner concludes that those other requirements are no less favorable to the policy owner and beneficiary than those required by this act. L.2017, c.236, s.2.

N.J. Stat. § 17B:17-28 Use of death index by insurer.

3. a. Every insurer shall use the death index to cross-check every policy and account subject to this act no less frequently than on a semi-annual basis, except as specified in section 6 of this act. An insurer may perform the cross-check using the updates made to the death index since the date of the last cross-check performed by the insurer, provided that the insurer performs the cross-check using the entire death index at least once. The commissioner may promulgate rules and regulations that allow an insurer to perform the cross-checks less frequently than semi-annually. b. The cross-checks shall be performed using the social security number, the name, and date of birth of the insured or account holder. c. If an insurer only has a partial name, social security number, date of birth, or combination thereof, of the insured or account holder under a policy or account, the insurer shall use the available information to perform the cross check. d. Every insurer shall implement reasonable procedures to account for common variations in data that would otherwise preclude an exact match with a death index. L.2017, c.236, s.3.

N.J. Stat. § 17B:17-29 Action of insurer upon receiving notice of death.

4. Upon receiving notification of the death of an insured or account holder or in the event of a match made by a death index cross-check pursuant to section 3 of this act, an insurer shall search every policy or account subject to this act to determine whether the insurer has any other policies or accounts for the insured or account holder. L.2017, c.236, s.4.

N.J. Stat. § 17B:17-30 Procedures to confirm death, location, notification of beneficiaries.

5. a. An insurer shall establish procedures to reasonably confirm the death of an insured or account holder and begin to locate beneficiaries within 90 days after the identification of a potential match made by a death index cross-check or by a search conducted by the insurer pursuant to section 4 of this act. For those potential matches identified as a result of a death index match, the insurer shall, within 90 days of a death index match, complete a good faith effort, which shall be documented by the insurer, to locate the beneficiary or beneficiaries. b. Once the beneficiary or beneficiaries under the policy or account have been located, the insurer shall provide to the beneficiary or beneficiaries the information necessary to make a claim pursuant to the terms of the policy or account. The insurer shall process all claims and make prompt payments and distributions in accordance with all applicable laws, rules, and regulations. c. Nothing in this act shall be construed to prevent an insurer from requiring satisfactory proof of loss, such as a death certificate, for the purpose of verifying the death of the insured. L.2017, c.236, s.5.

N.J. Stat. § 17B:17-31 Inapplicability of act.

6. This act shall not apply to: a. any account or policy issued to a group master policyholder in which the insurer does not maintain records on its administrative systems containing the information necessary to comply with the requirements of this act; b. any account, policy, or certificate that provides a death benefit under an employee benefits, government or church plan subject to or as defined under the Employee Retirement Income Security Act of 1974 (29 U.S.C. s.1002) or any other federal employee benefit program; c. any policy or certificate of life insurance that is used to fund a preneed funeral contract or prearrangement; d. any policy or certificate of credit life or accidental death insurance; or e. any other circumstance as determined to be appropriate by the commissioner. L.2017, c.236, s.6.

Source: Open US Law by Vaquill AI (CC BY 4.0)URL: https://www.njleg.state.nj.us/legislative-activity/statutesFetched: 10/17/2026