Except as otherwise authorized under the lien method for determining benefits under §4.1106(3) of this title (relating to Methods for Determining Benefits and Allowable Charges and Fees), if the cash values are reduced by the acceleration-of-life-insurance benefit, related charges, and interest, the reduction may not be unjust and may not exceed an amount equal to the pro rata portion of the cash value associated with the death benefit used in providing the acceleration-of-life-insurance benefit. Future cash values may not be less than the minimum cash values required by Insurance Code Chapter 1105, concerning Standard Nonforfeiture Law for Life Insurance, for the reduced future guaranteed death benefits. These minimum cash values are equal to the present value of the reduced future guaranteed benefits less the present value of future adjusted premiums, decreased by the amount of any indebtedness, including liens, under the life insurance contract. The mortality and interest used in calculating the minimum cash values will be as provided in Insurance Code Chapter 1105, for life insurance coverage, disregarding any acceleration-of-life-insurance benefits.

Source Note: The provisions of this §4.1107 adopted to be effective March 1, 1998, 23 TexReg 1585; transferred effective April 16, 1999, 24 TexReg 3092; amended to be effective June 23, 2008, 33 TexReg 4884; transferred effective September 1, 2023, as published in the July 28, 2023, issue of the Texas Register, 48 TexReg 4127; amended to be effective January 24, 2024, 49 TexReg 250