New York Clarifies Rules On War Risk Policy Limitations

In answer to repeated inquiries, New York state insurance regulators say disability benefits and accidental death benefits sold along with life insurance policies are exempt from three war risk exclusion provisions that apply to the underlying life policies.

The Life Bureau of the New York State Insurance Department issued Circular Letter Number 6, a summary of the rules governing war risk limitations, in March.

According to the letter:

-The underlying life policy must warn the policyholder about any war risk exclusions or restrictions in red capital letters on the policys face page.

-The issuer of a life policy must notify regulators about any war risk exclusions or restrictions.

-The issuer of a life policy that includes war risk exclusions or restrictions must end the limitations six months after the insured permanently leaves the war zone.

The Life Bureau says none of the three major war risk exclusion provisions that apply to life insurance policies apply to extra disability and accidental death benefits sold along with the policies.

The new Life Bureau guidance is on the Web at www.ins.state.ny.us/ilwexcl.htm

The original circular letter is at www.ins.state.ny.us/cl03_06.htm


Reproduced from National Underwriter Life & Health/Financial Services Edition, October 31, 2003. Copyright 2003 by The National Underwriter Company in the serial publication. All rights reserved.Copyright in this article as an independent work may be held by the author.