BY n.
Be it enacted, etc., as follows:
Section 36 of chapter 175 of the General Laws is hereby amended by striking
out the third paragraph, inserted by section 1 of chapter 218 of the acts of 1938,
and inserting in place thereof the following paragraph: -
Any domestic life company may, with the written approval of the commis-
sioner, also provide for the payment of pensions to its aged or disabled em-
ployees under a group contract issued by it. The employees and the company
shall contribute to the cost of, or the premium for, any such contract. Such a
company may, with like approval, insure the lives of its employees under a
group policy issued by it, which shall be subject to the provisions of sections
one hundred and thirty-three to one hundred and thirty-six, inclusive, so far as
applicable. The provisions of section ninety-four relative to membership and
voting rights in a domestic mutual life company shall not apply to any person
covered by or insured under any such contract or policy.
Approved February 3, 1954
CHAP. Ill - AN ACI RELATIVE TO THE INVESTMENlS OF DOMESHC LIFE
INSURANCE COMPANIES IN MASSACHUSETTS VOLUNIARY
ASSOCIATIONS AND TRUSIS.
Be it enacted, etc., as follows:
Section 1. Section 63 of chapter 175 of the General Laws is hereby amended by
striking out paragraph 14A, inserted by section 8 of chapter 266 of the acts of
1947, and inserting in place thereof the following paragraph: -
14A. In the bonds, notes or other evidences of indebtedness of companies in-
corporated under the laws of the United States, or any state thereof, or of the
Dominion of Canada or any province thereof or of associations or trusts as de-
fined in section one of chapter one hundred and eighty-two, the average net earn-
ings of the issuing company or such association or trust, as the case may be,
during the seven fiscal years next preceding the date of investment having been
not less than four times the fixed charges, provided, however, that no more than
one half of the capital of any domestic connpany, other than life, and not more
than one-half of the reserve of any domestic stock or mutual life company may be
invested under this paragraph. "Net earnings", as used in this paragraph, shall
mean net income after deducting operating and maintenance expenses, taxes other
than federal, state, dominion and provincial income taxes, depreciation and de-
pletion, but excluding extraordinary non-recurring items of income or expense
appearing in the regular financial statements of the issuing company or such
association or trust, as the case nnay be. "Fixed charges", as used in this para-
graph, shall include interest on all debt and annual apportionment of debt discount
or premium.
Section 2. Section 66 of chapter 175 of the General Laws, as amended by chap-
ter 650 of the acts of 1947, is hereby further amended by striking out the second
paragraph and inserting in place thereof, the following two paragraphs:-
Part I vii
Nothing in this section or in section sixty-three shall prevent such a life
company from investing or loaning any funds, not required to be invested as
provided in section sixty-three, in any manner that the directors may deter-
mine; provided, that no loan of such funds shall be made to an individual or
firm unless it is secured by collateral security and provided further, that
such funds shall not be invested in the purchase of stock or evidence of in-
debtedness prohibited by the preceding paragraph, except as hereinafter pro-
vided. Any such life company may invest such funds in the capital stock of a
trust company incorporated in and doing business in the commonwealth or of
a national banking association incorporated under federal law and located in
any one of the New England states, if such trust company or association has
paid dividends in cash of not less than four per cent on its capital stock in
each of the five years next preceding the date of the investment and if the
amount of surplus of such trust company or association is at least equal to
fifty per cent of the amount of its capital stock; but no such life company
shall invest in the aggregate an amount in excess of two and one half per
cent of its reserve in the purchase of stock of such trust companies and na-
tional banking associations, nor shall it invest an amount in excess of two
per cent of its reserve in the purchase of the stock of any one such trust com-
pany or association, except that if two or more such trust companies or as-
sociations merge or consolidate or one or more such trust companies is
merged or consolidated with one or more such associations, such a life com-
pany may acquire stock of the absorbing or consolidating trust company or
national banking association to an amount in excess of two per cent but not in
excess of two and one half per cent of the reserve of such life company, if
such stock is received in exchange for stock of the consolidating or merging
companies or associations owned by the life company at the time of the merger
or consolidation.
Nothing in this section or in section sixty-three shall prevent such a life com-
pany from investing or loaning any funds, not required to be invested as pro-
vided in section sixty-three, in the transferable certificates of participation or
shares, bonds, notes or other evidences of indebtedness, whether or not se-
cured by collateral, or an association or trust as defined in section one of
chapter one hundred and eighty-two; provided, that it shall not invest in, ac-
quire or hold directly or indirectly more than ten per cent of the certificates
of participation or shares of any such association or trust and that no more
than ten per cent of its capital and surplus may be invested in the transferable
certificates of participation or shares of any one such association or trust.
Approved February 15, 1954
CHAP. 176 - AN ACT RELATIVE TO THE INVESTMENTS QFDOMESTIC
INSURANCE COMPANIES IN LOANS UPON MORTGAGES.
Be it enacted, etc., as follows:
Chapter 175 of the General Laws is hereby amended by striking out section 65,
as most recently amended by chapter 41 of the acts of 1947, and inserting in
place thereof the following section:- Section 65. No domestic company shall,
except in effecting the sale of real estate owned by it, and then only with the
approval of the commissioner, invest any of its funds in loans upon mortgages
except upon the conditions expressed in paragraph 7 or paragraph 7A of section
sixty-three; provided, that any such company may make and acquire such loans
as a-e insured under the provisions of the National Housing Act or of any act in
amendment thereof or in addition thereto; provided, further, that any loans
heretofore or hereafter so made or acquired, or any loans heretofore or here-
after made or acquired which are guaranteed or insured under the Servicemen's
Readjustment Act of 1944 or any amendment thereof, shall qualify as an invest-
ment for all purposes of section sixty-three.
Approved March 1, 1954
viii P. D. 9
CHAP. 247 - AN ACT TO PERMIT ACCIDENT AND HEALTH INSURANCE
COMPANIES TO COVER THEIR EMPLOYEES FOR ACCIDENT
AND HEALIH INSURANCE.
Be it enacted, etc., as follows:
Chapter 175 of the General Laws is hereby amended by inserting after section
36A, inserted by chapter 496 of the acts of 1948, the following section: -
Section 36B. Any domestic company which is authorized to transact business
under subdivisions (a) and (d) of clause Sixth of section forty-seven may, with
the written approval of the commissioner, establish a plan to provide such
insurance benefits for its employees. Any such plan may provide for contri-
butions by the employees. The term "employee", as used in this section,
shall include an officer. Such benefits may be provided in one or more general
or blanket accident and health policies issued by such company, or with other
benefits in one or more group life policies or group annuity contracts issued by
such company, if authorized to issue any such policy or contract, or by any
other company so authorized, or in any other manner that the directors of such
company may prescribe. If any such benefits are provided otherwise than by
any such general or blanket or group policies, the company may in connection
therewith establish special funds for the purpose of financing such benefits.
Section one hundred and ten A shall apply to any benefits granted under the
authority of this section. Approved March 25, 1954
CHAP. 266 - AN ACT RELATIVE lO THE POWER OF BOILER AND
MACHINERY INSURANCE COMPANIES lO MAKE INSPECTIONS.
Whereas, Ihe deferred operation of this act would tend to defeat its purpose,
which is to make effective without delay the power granted thereby to boiler and
machinery insurance companies to make inspections, therefore it is hereby de-
clared to be an energency law, necessary for the immediate preservation of the
public safety.
Be it enacted, etc., as follows:
Section 47 of chapter 175 of the General Laws is hereby amended by striking
out clause Fifth, as appearing in the Tercentenary Edition, and inserting in
place thereof the following clause: -
Fifth, To insure against loss or damage to any property of the insured, and
against legal liability for loss or damage on account of the bodily injury or death
of any person or any damage to property of another, caused by the breakage, ex-
plosion or rupture of, or any accidental injury to, steam boilers and pipes and
containers connected therewith, any lighting, heating or cooking apparatus or
their connections, flywheels, power wheels, and engines or other apparatus for
applying or transmitting motive or electrical power, tanks or other receptacles
under pressure, or their connections, or machinery of any kind, and against
loss of use and occupancy caused thereby; and against loss or damage caused
by the interruption by any cause of electric current or of water or gas supply
furnished by a public utility company or municipality; and to make inspections
of boilers, machinery and apparatus of any kind, whether or not insured.
Approved April 5, 1954.
CHAP. 274 - AN ACT RELAIIVE TO THE SERVICE CHARGES FOR SECURING
MOTOR VEHICLE LIABILITY INSURANCE FOR CERTAIN PERSONS.
Be it enacted, etc., as follows:
Chapter 175 of the General Laws is hereby amended by inserting after section
113H, inserted by section 5 of chapter 570 of the acts of 1953, the following
section: - Section 1131. The commissioner shall fix and establish a schedule
of fair and reasonable service charges, together with enabling rules and regu-
lations, in connection with the securing or placing of motor vehicle liability
insurance under the plan of apportionment provided for under the provisions of
section one hundred and thirteen H. Whenever any person duly licensed under
Part I IX
any provision of this chapter fails to comply with such promulgations, the com-
missioner, for cause shown and after a hearing, shall suspend his license for
such period of time as he in his discretion deems feasible.
Approved April 5, 1954.
CHAP. 275 - AN ACT RELATING TQ INDIVIDUAL ACCIDENl AND HEALTH
INSURANCE POLICIES.
Be it enacted, etc., as follows:
Section 1. Chapter 175 of the General Laws is hereby amended by striking out
section 108, as most recently amended by chapter 607 of the acts of 1947, and
inserting in place thereof the following section:- Section 108. 1. The term
"policy of accident and sickness insurance" as used herein includes any policy
or contract covering the kind or kinds of insurance described in subdivisions
(a) and (d) of the sixth paragraph of section forty-seven.
2. (a) No policy of accident and sickness insurance shall be delivered or
issued for delivery to any person in this commonwealth: until a copy of the
policy and the table of rates or manual of risks of the company has been on
file with the commissioner for at least thirty days, unless before the expira-
tion of said thirty days the commissioner shall have approved the policy in
writing; nor if the commissioner notifies the company in writing that in his
opinion the form of said policy does not comply with the laws of the common-
wealth, specifying the reasons for his opinion, provided that such action of the
commissioner shall be subject to review by the suprenne judicial court; nor
unless:
(1) The entire nnoney and other considerations therefor are expressed therein;
and
(2) The time at which the insurance takes effect and terminates is expressed
therein; and
(3) It purports to insure only one person, except that a policy may insure,
originally or by subsequent amendment, upon the application of an adult member
of a family who shall be deemed the policyholder, any two or more eligible mem-
bers of that family, including husband, wife, dependent children or any children
under a specified age which shall not exceed nineteen years and any other person
dependent upon the policyholder; and
(4) The style, arrangement and over -all appearance of the policy give no undue
prominence to any portion of the text, and unless every printed portion of the
text of the policy and of any endorsements or attached papers is plainly printed
in light-faced type of a style in general use, the size of which shall be uniform
and not less than ten-point with a lower-case unspaced alphabet length not less
than one hundred and twenty-point (the text shall include all printed matter ex-
cept the name and address of the insurer, name or title of the policy, the brief
description if any, and captions and subcaptions); and
(5) The exceptions and reductions of indemnity are set forth in the policy and,
except those which are set forth in paragraph three, are printed, at the insurer's
option, either included with the benefit provision to which they apply, or under
an appropriate caption such as "EXCEPTIONS", or "EXCEPTIONS AND REDUC-
TIONS", provided, that if an exception or reduction specifically applies only to a
particular benefit of the policy, a statement of such exception or reduction shall
be included with the benefit provision to which it applies; and
(6) Each such form, including riders and endorsements, shall be identified by a
form number in the lower Left-hand corner of the first page thereof; and
(7) It contains no provision purporting to make any portion of the charter, rules,
constitution, or by-laws of the insurer a part of the policy unless such portion is
set forth in full in the policy, except in the case of the incorporation of, or ref-
erence to, a statement of rates or classification of risks, or short-rate table
filed with the commissioner.
X P.D. 9
(b) If any poLicy is issued by an insurer domiciled in this commonwealth for
delivery to a person residing in another state, and if the official having re-
sponsibility for the administration of the insurance laws of such other state
shall have advised the commissioner that any such policy is not subject to ap-
proval or disapproval by such official, the commissioner may by ruling re-
quire that such policy meet the standards set forth in paragraph (a) and in
subdivision three.
3. (a) Except as provided in paragraph (c) of this subdivision each such policy
delivered or issued for delivery to any person in the commonwealth shall con-
tain the provisions specified in this paragraph in the words in which they ap-
pear; provided, however, that the insurer may, at its option, substitute for
one or more of such provisions corresponding provisions of different wording
approved by the commissioner which are in each instance not less favorable in
any respect to the insured or the beneficiary. Such provisions shall be pre-
ceded individually by the caption appearing in this paragraph or, at the option
of the insurer, by such appropriate individual or group captions or subcaptions
as the commissioner may approve.
(1) Entire Contract, Changes. - This policy, including the endorsements and
the attached papers, if any, constitutes the entire contract of insurance. No
change in this policy shall be valid until approved by an executive officer of the
insurer and unless such approval be endorsed hereon or attached hereto. No
agent has authority to change this policy or to waive any of its provisions.
(2) Time Limit on Certain Defenses. - After two years from the date of issue
of this policy no misstatements, except fraudulent misstatements, made by the
applicant in the application for such policy shall be used to void the policy or to
deny a claim for loss incurred or disability as defined in the policy commencing
after the expiration of such two-year period.
The foregoing policy provision shall not be so construed as to affect any legal
requirement for avoidance of a policy or denial of a claim during such initial two-
year period, nor to limit the application of provisions (I) to (5), inclusive, of
paragraph (b) of this subdivision, in the event of misstatement with respect to
age or occupation or other insurance.
A policy which the insured has the right to continue in force subject to its ternns
by the timely payment of premium until at least age fifty, or, in the case of a
policy issued after age forty-four, for at least five years from its date of issue,
may contain in lieu of the foregoing provision the following provision from which
the clause in parentheses may be omitted at the insurer's option, under the cap-
tion "INCONTESTABLE": -
After this policy has been in force for a period of two years during the lifetime
of the insured (excluding any period during which the insured is disabled), it
shall become incontestable as to the statements contained in the application.
No claim for loss incurred or disability (as defined in the policy) commencing
after three years from the date of issue of this policy shall be reduced or denied
on the ground that a disease or physical condition not excluded from coverage by
name or specific description effective on the date of loss had existed prior to the
effective date of coverage of this policy.
(3) Grace Period. - A grace period of (insert a number not less than "7" for
weekly premium policies, "10" for monthly premium policies and "31" for all
other policies) days will be granted for the payment of each premium falling due
after the first premium during which grace period the policy shall continue in
force .
A policy which contains a cancellation provision may add, at the end of the above
provision, the following: - subject to the right of the insurer to cancel in accord-
ance with the cancellation provision hereof.
Part I xi
A policy in which the insurer reserves the right to refuse any renewal shall
have, at the beginning of the above provision: -
Unless not less than five days prior to the premium due date the insurer has
delivered to the insured or has mailed to his last address as shown by the
records of the insurer written notice of its intention not to renew this policy
beyond the period for which the premium has been accepted.
(4) Reinstatement - K any renewal premium be not paid within the time
granted the insured for payment, a subsequent acceptance of premium by the
insurer or by any agent duly authorized by the insurer to accept such premium,
without requiring in connection therewith an application for reinstatement, shall
reinstate the policy; provided, however, that if the insurer or such agent re-
quires an application for reinstatement and issues a condtional receipt for the
premium tendered, the policy will be reinstated upon approval of such applica-
tion by the insurer or, lacking such approval, upon the forty-fifth day follow-
ing the date of such conditional receipt unless the insurer has previously noti-
fied the insured in writing of its disapproval of such application. The rein-
stated policy shall cover only loss resulting from such accidental injury as
may be sustained after the date of reinstatement and loss due to such sickness
as naay begin more than ten days after such date. In all other respects the in-
sured and insurer shall have the same rights thereunder as they had under the
policy immediately before the due date of the defaulted premium, subject to any
provisions endorsed hereon or attached hereto in connection with the reinstate-
ment. Any premium accepted in connection with a re instate nnent shall be ap-
plied to a period for which prennium has not been previously paid, but not to
any period more than sixty days prior to the date of reinstatement.
The last sentence of the above provision may be omitted from any policy
which the insured has the right to continue in force subject to its terms by the
timely payment of premiums until at least age fifty, or, in the case of a policy
issued after age forty-four, for at least five years from its date of issue.
(5) Notice of Claim. - Written notice of claim must be given to the insurer
within twenty days after the occurrence or commencement of any loss covered
by the policy, or as soon thereafter as is reasonably possible. Notice given by
or on behalf of the insured or the beneficiary to the insurer at (insert the loca-
tion of such office as the insurer may designate for the purpose) or to any au-
thorized agent of the insurer, with information sufficient to identify the insured,
shall be deemed notice to the insurer.
In a policy providing a loss -of -time benefit which may be payable for at least
two years, an insurer may at its option insert after the first sentence of pro-
vision (5) the following three sentences: -
Subject to the qualifications set forth below, if the insured suffers loss of
time on account of disability for which indemnity may be payable for at least
two years, he shall, at least once in every six months after having given no-
tice of claim, give to the insurer notice of continuance of said disability, except
in the event of legal incapacity. Ihe period of six months following any filing
of proof by the insured or any payment by the insurer on account of such claim
or any denial of liability in whole or in part by the insurer shall be excluded in
applying this provision. Delay in the giving of such notice shall not impair the
insured's right to any indemnity which would otherwise have accrued during the
period of six months preceding the date on which suchjiotice is actually given.
(6) Claim Forms. - The insurer, upon receipt of a notice of claim, will fur-
nish to the claimant such forms as are usually furnished by it for (filing proofs
of loss. If such forms are not furnished within fifteen days after the giving of
such notice the claimant shall be deemed to have complied with the requirements
of this policy as to proof of loss upon submitting, within the time fixed in the
Jui P. D. 9
policy for filing proofs of loss, written proof covering the occurrence, the char-
acter and the extent of the loss for which claim is nnade .
(7) Proof of Loss. - Written proof of loss must be furnished to the insurer at
its said office in case of claim for loss for which this policy provides any periodic
payment contingent upon continuing loss within ninety days after the termination
of the period for which the insurer is liable and in case of claim for any other
loss within ninety days after the date of such loss. Failure to furnish such proof
within the time required shall not invalidate nor reduce any claim if it was not
reasonably possible to give proof within such time, provided such proof is fur-
nished as soon as reasonably possible and in no event, except in the absence of
legal capacity, later than one year from the time proof is otherwise required.
(8) Time of Payment of Claims. - Indemnities payable under this policy for any
loss other than loss for which this policy provides any periodic payment will be
paid immediately upon receipt of due written proof of such loss. Subject to due
written proof of loss, all accrued indemnities for loss for which this policy pro-
vides periodic payment will be paid (insert period for payment which must not be
less frequently than monthly) and any balance remaining unpaid upon the termina-
tion of liability will be paid immediately upon receipt of due written proof.
(9) Payment of Claims. - Indemnity for loss of life will be payable in accord-
ance with the beneficiary designation and the provisions respecting such payment
which may be prescribed herein and effective at the time of payment. If no such
designation or provision is then effective, such indemnity shall be payable to the
estate of the insured. Any other accrued indemnities unpaid at the insured's
death may, at the option of the insurer, be paid either to such beneficiary or to