(a) Documents must be submitted for approval.
  (1) Forms must be submitted in duplicate, completed as John Doe Specimen. Typewritten forms may be submitted for preliminary review, but only printed forms will be accepted for approval and filing.
  (2) The following forms are required to be submitted with each policy form:
    (A) the application;
    (B) the application for reinstatement; and
    (C) the rates to be used with the policy.
  (3) No application, application for reinstatement, certificate, or policy of insurance or schedule of rates to be used therewith shall be acted upon until all of such items are in accordance with the Insurance Code and other applicable law, and all of such items will be acted upon simultaneously.
(b) Only approved forms may be used.
  (1) No person, whether an organizer, agent, company or association or other legal entity may use, offer or deliver any application, application for reinstatement, certificate or policy of insurance, or endorsement or rider to a policy of insurance in an association or proposed association subject to these sections until such form has been approved by appropriate order of the State Board of Insurance, nor until the rates to be used in connection with such form have been filed with the State Board of Insurance. As to life insurance and burial policies only, see also the Insurance Code, Article 14.20.
  (2) No application for a policy or for reinstatement of a policy may contain a proxy; provided, a proxy may appear below the signature of the applicant.
(c) Life and burial policy forms.
  (1) Each form must be designated by a suitable form number which may be composed of numbers or letters or both. The form number should be sufficient to distinguish the form from all others used by the company. When any word, provision, format, or arrangement of a previously approved form is changed, a new form number must be assigned and the form resubmitted for approval. A mere reprinting where no change whatever is made in the policy or other form need not be resubmitted.
  (2) The following must appear at the top of each form:
    (A) the name of the company or association;
    (B) the location of the principal office of the company or association; and
    (C) the type of company or association, such as: "A Local Mutual Aid Association," "A Local Mutual Burial Association," or "A Statewide Mutual Assessment Corporation."
  (3) The following must be stated on the front page of the policy:
    (A) the names and ages of all those insured;
    (B) the name of the beneficiary (except for burial association policies providing merchandise and service benefits);
    (C) the amount of death benefit (which must be shown in dollars except burial association policies);
    (D) the amount of premium and mode of payment permitted shall be plainly stated. (On a family group policy with individual premiums, the amount of individual as well as the total premium should be shown);
    (E) the effective date of the policy; and
    (F) attention directed to any reduction or exclusion of benefits provided therein.
  (4) Entire contract. The policy must state that the policy, the application therefor, the application for reinstatement, if any, and the constitution and bylaws of the association as it now exists or may be hereafter amended, shall constitute the entire contract, and that a copy of the application for the policy shall be attached thereto.
  (5) Incontestable clause. Each certificate must provide that it shall be incontestable, after having been in force during the lifetime of the insured, for a period of two years from date of issue, except for nonpayment of dues or assessments.
  (6) Grace period. The grace period shall be stated in the policy and shall be consistent with the provisions regarding same in the constitution and bylaws of the association.
  (7) Reinstatement.
    (A) If a policy is subject to reinstatement, the conditions under which a member will be reinstated shall be specified in the policy. A statement that a member may be "reinstated at the option of the company," or "by complying with such requirements as may be exacted by the company," or any similar language is not acceptable. A provision that the insured may be reinstated "upon furnishing evidence of good health," or similar language is acceptable.
    (B) If nine months have elapsed between termination and reinstatement, a reinstatement fee not in excess of the membership fee may be charged and placed in the expense fund. A reinstatement fee may not be charged unless such nine months have elapsed.
    (C) The reinstatement certificate shall be incontestable, after having been in force during the lifetime of the insured, for a period of six months from the date thereof, for any cause except nonpayment of assessments, unless the reinstatement is within the original two-year contestable period, in which case the contestable period may be extended for six months from the date on which the original contestable period would have expired.
  (8) Notice of claim. If a policy is to contain a provision fixing the time within which the notice of claim must be given, such time must be fixed at not less than 91 days. The notice may be given to the nearest or any other convenient local agent of the company.
  (9) Claim forms. If a policy provides that notice of claims must be filed on forms furnished by the association, it must also provide that written notice of claim given to the association shall be deemed due proof in the event the association fails upon receipt of notice to furnish the claimant, within 15 days, such forms as are usually furnished by it for filing claims.
  (10) Action at law. The policy may not contain a provision limiting to less than two years after a cause of action shall accrue the time within which any action at law or in equity may be commenced.
  (11) Statements of the insured.
    (A) Statements as representations. All statements in the application shall, in the absence of fraud, be regarded as representations and not warranties.
    (B) Misstatement of health. If the certificate is to provide that misstatement as to the health or physical condition of the applicant may void the policy within the contestable period, the application must so state in not less than 10-point type in language acceptable to the State Board of Insurance.
    (C) Misstatement of age. Each certificate must provide that if the age of the insured has been misstated, the amount of insurance shall be such as the premium would have purchased at the correct age, based on rates in force at the death of the insured.
  (12) Policy loans. Except as permitted by the Insurance Code, Article 14.64, the policy shall make no provision for policy loans.
  (13) Rates and benefits. Rates must be quoted only for such ages and benefits as are on file with the State Board of Insurance. Benefits shall not be in excess of the amount of the deposit made by such company or association under the provisions of the Insurance Code, Article 14.10.
  (14) Reduction of benefits. A policy may provide for reduced benefits only as authorized under the provisions of the Insurance Code, Article 14.20.
  (15) The term "natural death" shall not be used in a policy.
  (16) Misleading statements. Neither a policy nor any application form shall contain language or be in such form as to mislead the applicant or the policyholder as to the type of insurance afforded.
  (17) Family group policies.
    (A) Individual premium. There shall be a provision for a reduction of the total premium when a member dies by the amount of the premium being paid on behalf of the deceased member; provided, however, that this requirement shall not extend to policies providing for larger benefits upon the successive deaths of the insured.
    (B) Family group premium. Family group premiums may be charged or collected when it has been shown that the company or association making the charge has made provision for keeping proper statistical records for the purpose of determining proper cost of insurance, and that a provision has been made as to the method of calculating any return of premium benefits.
    (C) The application. The application must be signed by an applicant unless the applicant is a minor, in which event the application may be signed by a parent or guardian. It shall never be necessary that more than one applicant sign the application.
  (18) Term policies. Except as permitted in the Insurance Code, Article 14.64, statewide mutual assessment companies shall not issue any certificate or policy upon a limited payment plan, nor guarantee or promise to pay any type of endowment or annuity benefits, but shall confine its operation to the issuance of a certificate or policy looking to continuous payment of premiums or assessments during the lifetime of the policyholder.
  (19) Burial policies. In addition to the foregoing requirements, policies to be issued by local mutual burial associations shall provide:
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