PRIA, Government Policy, Made Personal

Summary

Dividends paid after January 1, 1952 will automatically go to pay future insurance premiums unless the insured sends a written request telling the Secretary to use them another way. If someone asks for cash for a special dividend declared before January 1, 1952, that request must have been filed within six years of the dividend’s declaration. Late requests will be sent back with a copy of this rule and that reply is final. An insured can ask in writing to use dividends to buy paid-up insurance without proving good health. For dividends payable after the application date this is allowed. During the one-year period starting September 1, 1991, insureds could also use existing dividend credits and deposits at the application date the same way. After September 1, 1992, the Secretary may allow more one-year periods if it is actuarially and administratively sound. Dividends on endowment policies can only buy paid-up endowment insurance that matures with the main policy. Dividends on other policies can only buy paid-up whole life insurance. The paid-up insurance is extra and follows the standard policy terms except: premiums and cash/loan values use mortality and interest tables set by the Secretary; the total disability income provision under section 1915 of this title cannot be added; and the Secretary may make other reasonable changes.

Title 38, §1907

Veterans' Benefits, Source: USLM XML via OLRC

(a)Until and unless the Secretary has received from the insured a request or directive in writing exercising any other dividend option allowable under the insured’s policy, any dividend accumulations and unpaid dividends shall be applied in payment of premiums becoming due on insurance subsequent to the date the dividend is payable after January 1, 1952.

(b)No claim by an insured for payment in cash of a special dividend declared prior to January 1, 1952, shall be processed by the Secretary unless such claim was received within six years after such dividend was declared. Whenever any claim for payment of a special dividend, the processing of which is barred by this subsection, is received by the Secretary, it shall be returned to the claimant, with a copy of this subsection, and such action shall be a complete response without further communication.

(c)The Secretary, upon application in writing made by the insured for insurance under this subsection, and without proof of good health, is authorized to apply any dividend due and payable on national service life insurance after the date of such application to purchase paid up insurance. Also, the Secretary, upon application in writing made by the insured during the one-year period beginning September 1, 1991, and without proof of good health, is authorized to apply any national service life insurance dividend credits and deposits of such insured existing at the date of the insured’s application to purchase paid up insurance. After September 1, 1992, the Secretary may, from time to time, provide for further one-year periods during which insureds may purchase additional paid up insurance from existing dividend credits and deposits. Any such period for the purchase of additional paid up insurance may be allowed only if the Secretary determines in the case of any such period that it would be actuarially and administratively sound to do so. Any dividends, dividend credits, or deposits on endowment policies may be used under this subsection only to purchase additional paid up endowment insurance which matures concurrently with the basic policy. Any dividends, dividend credits, or deposits on policies (other than endowment policies) may be used under this section only to purchase additional paid up whole life insurance. The paid up insurance granted under this subsection shall be in addition to any insurance otherwise authorized under this title, or under prior provisions of law. The paid up insurance granted under this subsection shall be issued on the same terms and conditions as are contained in the standard policies of national service life insurance except (1) the premium rates for such insurance and all cash and loan values thereon shall be based on such table of mortality and rate of interest per annum as may be prescribed by the Secretary; (2) the total disability income provision authorized under section 1915 of this title may not be added to insurance issued under this section; and (3) the insurance shall include such other changes in terms and conditions as the Secretary determines to be reasonable and practicable.

Notes & Related Subsidiaries

Editorial Notes

Amendments

1991—Pub. L. 102–83, § 5(a), renumbered section 707 of this title as this section. Subsec. (a). Pub. L. 102–83, § 4(a)(2)(A)(iii)(I), substituted “Secretary” for “Veterans’ Administration”. Subsec. (b). Pub. L. 102–83, § 4(a)(2)(C)(i), substituted “by the Secretary” for “in the Veterans’ Administration” in second sentence. Pub. L. 102–83, § 4(a)(2)(A)(iii)(I), substituted “Secretary” for “Veterans’ Administration” in first sentence. Subsec. (c). Pub. L. 102–86 amended subsec. (c) of this section as in effect before the redesignations made by Pub. L. 102–83, § 5, by substituting “during the one-year period beginning

September 1, 1991” for “before

February 1, 1973” and inserting after second sentence “After

September 1, 1992, the Secretary may, from time to time, provide for further one-year periods during which insureds may purchase additional paid up insurance from existing dividend credits and deposits. Any such period for the purchase of additional paid up insurance may be allowed only if the Secretary determines in the case of any such period that it would be actuarially and administratively sound to do so.” Pub. L. 102–83, § 5(c)(1), substituted “1915” for “715” in cl. (2). Pub. L. 102–83, § 4(b)(1), (2)(E), substituted “Secretary” for “Administrator” wherever appearing. 1986—Subsecs. (a), (c). Pub. L. 99–576 substituted “the insured’s” for “his”. 1982—Subsec. (c). Pub. L. 97–295 substituted “before

February 1, 1973” for “within six calendar months after the

Effective Date

of this subsection”. 1971—Pub. L. 92–188, § 2(3), substituted “Payment or use of dividends” for “Dividends to pay premiums” as section catchline. Subsec. (a). Pub. L. 92–188, § 2(1), substituted “or directive in writing exercising any other dividend option allowable under his policy” for “in writing for payment in cash”. Subsec. (c). Pub. L. 92–188, § 2(2), added subsec. (c). 1970—Pub. L. 91–291 designated existing provisions as subsec. (a) and added subsec. (b).

Statutory Notes and Related Subsidiaries

Effective Date

of 1971 Amendment Pub. L. 92–188, § 4, Dec. 15, 1971, 85 Stat. 645, provided that: “The

Amendments

made by this Act [amending this section and section 703 and 741 [now 1903 and 1941] of this title] shall take effect on a date established by the Administrator but in no event later than the first day of the first calendar month which begins more than six calendar months after the date of enactment of this Act [Dec. 15, 1971].”

Effective Date

of 1970 AmendmentAmendment by Pub. L. 91–291 effective June 25, 1970, see section 14(a) of Pub. L. 91–291, set out as a note under section 1317 of this title.

§1907 Payment or Use of Dividends

Summary

Title 38, §1907

Notes & Related Subsidiaries

Editorial Notes

Amendments

Effective Date

Statutory Notes and Related Subsidiaries

Effective Date

Amendments

Effective Date

Citations & Metadata