Amended IN Assembly March 09, 2023 CALIFORNIA LEGISLATURE 20232024 REGULAR SESSION Assembly Bill No. 1709Introduced by Assembly Member CalderonFebruary 17, 2023 An act to amend Section 1992 10509.959 of the Insurance Code, relating to insurance. LEGISLATIVE COUNSEL'S DIGESTAB 1709, as amended, Calderon. Marine insurance. Life insurance policy illustrations.Existing law creates the Department of Insurance, headed by the Insurance Commissioner, and generally regulates the business of insurance in the state, including the regulation of life insurance policy illustrations, as defined. For a policy designated as one for which illustrations will be used, existing law requires an insurer to provide each policy owner with an annual report on the status of the policy along with prescribed information, including the current dividend, as applicable. If the annual report does not include an in force illustration, existing law requires that report to contain a prominently displayed notice that informs the insured they may annually request, without charge, an illustration by various means, including calling or writing to the insurer.For an annual report that does not include an in force illustration, this bill would additionally provide that the notice inform the insured they may submit their request by accessing the insurers internet website address.Existing law generally regulates classes of insurance, including marine insurance. Under existing law, in estimating a loss under an open policy of marine insurance, specified rules are to be observed.This bill would make technical, nonsubstantive changes to that provision.Digest Key Vote: MAJORITY Appropriation: NO Fiscal Committee: NOYES Local Program: NO Bill TextThe people of the State of California do enact as follows:SECTION 1. Section 10509.959 of the Insurance Code is amended to read:10509.959. (a) In the case of a policy designated as one for which illustrations will be used, the insurer shall provide each policy owner with an annual report on the status of the policy that shall include, but not be limited to, the following information:(1) For universal life policies, the report shall include the following:(A) The beginning and end date of the current report period.(B) The policy value at the end of the previous report period and at the end of the current report period.(C) The total amounts that have been credited or debited to the policy value during the current report period, identifying each by type, including, but not limited to, interest, mortality, expense expense, and riders.(D) The current death benefit at the end of the current report period on each life covered by the policy.(E) The net cash surrender value of the policy as of the end of the current report period.(F) The amount of outstanding loans, if any, as of the end of the current report period.(G) For fixed premium policies:If, assuming guaranteed interest, mortality and expense loads and continued scheduled premium payments, the policys net cash surrender value is such that it would not maintain insurance in force until the end of the next reporting period, a notice to this effect shall be included in the report.(H) For flexible premium policies:If, assuming guaranteed interest, mortality and expense loads, the policys net cash surrender value will not maintain insurance in force until the end of the next reporting period unless further premium payments are made, a notice to this effect shall be included in the report.(2) For all other policies, the report shall include the following, where as applicable:(A) Current death benefit.(B) Annual contract premium.(C) Current cash surrender value.(D) Current dividend.(E) Application of current dividend.(F) Amount of outstanding loan.(3) Insurers writing life insurance policies that do not build nonforfeiture values shall only be required to provide an annual report with respect to these policies for those years when a change has been made to nonguaranteed policy elements by the insurer.(b) If the annual report does not include an in force illustration, it shall contain the following notice displayed prominently: IMPORTANT POLICY OWNER NOTICE: You should consider requesting more detailed information about your policy to understand how it may perform in the future. You should not consider replacement of your policy or make changes in your coverage without requesting a current illustration. You may annually request, without charge, such an illustration by calling [insurers phone number], writing to [insurers address] address], accessing [insurers internet website address], or contacting your agent. If you do not receive a current illustration of your policy within thirty days from your request, you should contact your state insurance department. The insurer may vary the sequential order of the methods for obtaining an in force illustration.(c) Upon the request of the policy owner, the insurer shall furnish an in force illustration of current and future benefits and values based on the insurers present illustrated scale. This illustration shall comply with the requirements of subdivisions (a) and (b) of Section 10509.955 and subdivisions (a) and (e) of Section 10509.956. No A signature or any other acknowledgment of receipt of this illustration shall not be required.(d) If an adverse change in nonguaranteed elements that could affect the policy has been made by the insurer since the last annual report, the annual report shall contain a notice of that fact and the nature of the change prominently displayed.SECTION 1.Section 1992 of the Insurance Code is amended to read:1992.In estimating a loss under an open policy of marine insurance, the following rules are to be observed:(a)The value of a ship is its value at the beginning of the risk, including all articles or charges that add to its permanent value or that are necessary to prepare it for the voyage insured.(b)The value of cargo is either its actual cost to the insured, when laden on board, or, where that cost can not be ascertained, its market value at the time and place of lading, adding the charges incurred in purchasing and placing it on board, but without reference to:(1)Any losses incurred in raising money for its purchase.(2)Any drawback on its exportation.(3)The fluctuations of the market at the port of destination.(4)Expenses incurred on the way or on arrival.(c)The value of freightage is the gross freightage, exclusive of primage, without reference to the cost of earning it.(d)The cost of insurance is in each case to be added to the value thus estimated.
Amended IN Assembly March 09, 2023 CALIFORNIA LEGISLATURE 20232024 REGULAR SESSION Assembly Bill No. 1709Introduced by Assembly Member CalderonFebruary 17, 2023 An act to amend Section 1992 10509.959 of the Insurance Code, relating to insurance. LEGISLATIVE COUNSEL'S DIGESTAB 1709, as amended, Calderon. Marine insurance. Life insurance policy illustrations.Existing law creates the Department of Insurance, headed by the Insurance Commissioner, and generally regulates the business of insurance in the state, including the regulation of life insurance policy illustrations, as defined. For a policy designated as one for which illustrations will be used, existing law requires an insurer to provide each policy owner with an annual report on the status of the policy along with prescribed information, including the current dividend, as applicable. If the annual report does not include an in force illustration, existing law requires that report to contain a prominently displayed notice that informs the insured they may annually request, without charge, an illustration by various means, including calling or writing to the insurer.For an annual report that does not include an in force illustration, this bill would additionally provide that the notice inform the insured they may submit their request by accessing the insurers internet website address.Existing law generally regulates classes of insurance, including marine insurance. Under existing law, in estimating a loss under an open policy of marine insurance, specified rules are to be observed.This bill would make technical, nonsubstantive changes to that provision.Digest Key Vote: MAJORITY Appropriation: NO Fiscal Committee: NOYES Local Program: NO
Amended IN Assembly March 09, 2023
Amended IN Assembly March 09, 2023
CALIFORNIA LEGISLATURE 20232024 REGULAR SESSION
Assembly Bill
No. 1709
Introduced by Assembly Member CalderonFebruary 17, 2023
Introduced by Assembly Member Calderon
February 17, 2023
An act to amend Section 1992 10509.959 of the Insurance Code, relating to insurance.
LEGISLATIVE COUNSEL'S DIGEST
## LEGISLATIVE COUNSEL'S DIGEST
AB 1709, as amended, Calderon. Marine insurance. Life insurance policy illustrations.
Existing law creates the Department of Insurance, headed by the Insurance Commissioner, and generally regulates the business of insurance in the state, including the regulation of life insurance policy illustrations, as defined. For a policy designated as one for which illustrations will be used, existing law requires an insurer to provide each policy owner with an annual report on the status of the policy along with prescribed information, including the current dividend, as applicable. If the annual report does not include an in force illustration, existing law requires that report to contain a prominently displayed notice that informs the insured they may annually request, without charge, an illustration by various means, including calling or writing to the insurer.For an annual report that does not include an in force illustration, this bill would additionally provide that the notice inform the insured they may submit their request by accessing the insurers internet website address.Existing law generally regulates classes of insurance, including marine insurance. Under existing law, in estimating a loss under an open policy of marine insurance, specified rules are to be observed.This bill would make technical, nonsubstantive changes to that provision.
Existing law creates the Department of Insurance, headed by the Insurance Commissioner, and generally regulates the business of insurance in the state, including the regulation of life insurance policy illustrations, as defined. For a policy designated as one for which illustrations will be used, existing law requires an insurer to provide each policy owner with an annual report on the status of the policy along with prescribed information, including the current dividend, as applicable. If the annual report does not include an in force illustration, existing law requires that report to contain a prominently displayed notice that informs the insured they may annually request, without charge, an illustration by various means, including calling or writing to the insurer.
For an annual report that does not include an in force illustration, this bill would additionally provide that the notice inform the insured they may submit their request by accessing the insurers internet website address.
Existing law generally regulates classes of insurance, including marine insurance. Under existing law, in estimating a loss under an open policy of marine insurance, specified rules are to be observed.
This bill would make technical, nonsubstantive changes to that provision.
## Digest Key
## Bill Text
The people of the State of California do enact as follows:SECTION 1. Section 10509.959 of the Insurance Code is amended to read:10509.959. (a) In the case of a policy designated as one for which illustrations will be used, the insurer shall provide each policy owner with an annual report on the status of the policy that shall include, but not be limited to, the following information:(1) For universal life policies, the report shall include the following:(A) The beginning and end date of the current report period.(B) The policy value at the end of the previous report period and at the end of the current report period.(C) The total amounts that have been credited or debited to the policy value during the current report period, identifying each by type, including, but not limited to, interest, mortality, expense expense, and riders.(D) The current death benefit at the end of the current report period on each life covered by the policy.(E) The net cash surrender value of the policy as of the end of the current report period.(F) The amount of outstanding loans, if any, as of the end of the current report period.(G) For fixed premium policies:If, assuming guaranteed interest, mortality and expense loads and continued scheduled premium payments, the policys net cash surrender value is such that it would not maintain insurance in force until the end of the next reporting period, a notice to this effect shall be included in the report.(H) For flexible premium policies:If, assuming guaranteed interest, mortality and expense loads, the policys net cash surrender value will not maintain insurance in force until the end of the next reporting period unless further premium payments are made, a notice to this effect shall be included in the report.(2) For all other policies, the report shall include the following, where as applicable:(A) Current death benefit.(B) Annual contract premium.(C) Current cash surrender value.(D) Current dividend.(E) Application of current dividend.(F) Amount of outstanding loan.(3) Insurers writing life insurance policies that do not build nonforfeiture values shall only be required to provide an annual report with respect to these policies for those years when a change has been made to nonguaranteed policy elements by the insurer.(b) If the annual report does not include an in force illustration, it shall contain the following notice displayed prominently: IMPORTANT POLICY OWNER NOTICE: You should consider requesting more detailed information about your policy to understand how it may perform in the future. You should not consider replacement of your policy or make changes in your coverage without requesting a current illustration. You may annually request, without charge, such an illustration by calling [insurers phone number], writing to [insurers address] address], accessing [insurers internet website address], or contacting your agent. If you do not receive a current illustration of your policy within thirty days from your request, you should contact your state insurance department. The insurer may vary the sequential order of the methods for obtaining an in force illustration.(c) Upon the request of the policy owner, the insurer shall furnish an in force illustration of current and future benefits and values based on the insurers present illustrated scale. This illustration shall comply with the requirements of subdivisions (a) and (b) of Section 10509.955 and subdivisions (a) and (e) of Section 10509.956. No A signature or any other acknowledgment of receipt of this illustration shall not be required.(d) If an adverse change in nonguaranteed elements that could affect the policy has been made by the insurer since the last annual report, the annual report shall contain a notice of that fact and the nature of the change prominently displayed.SECTION 1.Section 1992 of the Insurance Code is amended to read:1992.In estimating a loss under an open policy of marine insurance, the following rules are to be observed:(a)The value of a ship is its value at the beginning of the risk, including all articles or charges that add to its permanent value or that are necessary to prepare it for the voyage insured.(b)The value of cargo is either its actual cost to the insured, when laden on board, or, where that cost can not be ascertained, its market value at the time and place of lading, adding the charges incurred in purchasing and placing it on board, but without reference to:(1)Any losses incurred in raising money for its purchase.(2)Any drawback on its exportation.(3)The fluctuations of the market at the port of destination.(4)Expenses incurred on the way or on arrival.(c)The value of freightage is the gross freightage, exclusive of primage, without reference to the cost of earning it.(d)The cost of insurance is in each case to be added to the value thus estimated.
The people of the State of California do enact as follows:
## The people of the State of California do enact as follows:
SECTION 1. Section 10509.959 of the Insurance Code is amended to read:10509.959. (a) In the case of a policy designated as one for which illustrations will be used, the insurer shall provide each policy owner with an annual report on the status of the policy that shall include, but not be limited to, the following information:(1) For universal life policies, the report shall include the following:(A) The beginning and end date of the current report period.(B) The policy value at the end of the previous report period and at the end of the current report period.(C) The total amounts that have been credited or debited to the policy value during the current report period, identifying each by type, including, but not limited to, interest, mortality, expense expense, and riders.(D) The current death benefit at the end of the current report period on each life covered by the policy.(E) The net cash surrender value of the policy as of the end of the current report period.(F) The amount of outstanding loans, if any, as of the end of the current report period.(G) For fixed premium policies:If, assuming guaranteed interest, mortality and expense loads and continued scheduled premium payments, the policys net cash surrender value is such that it would not maintain insurance in force until the end of the next reporting period, a notice to this effect shall be included in the report.(H) For flexible premium policies:If, assuming guaranteed interest, mortality and expense loads, the policys net cash surrender value will not maintain insurance in force until the end of the next reporting period unless further premium payments are made, a notice to this effect shall be included in the report.(2) For all other policies, the report shall include the following, where as applicable:(A) Current death benefit.(B) Annual contract premium.(C) Current cash surrender value.(D) Current dividend.(E) Application of current dividend.(F) Amount of outstanding loan.(3) Insurers writing life insurance policies that do not build nonforfeiture values shall only be required to provide an annual report with respect to these policies for those years when a change has been made to nonguaranteed policy elements by the insurer.(b) If the annual report does not include an in force illustration, it shall contain the following notice displayed prominently: IMPORTANT POLICY OWNER NOTICE: You should consider requesting more detailed information about your policy to understand how it may perform in the future. You should not consider replacement of your policy or make changes in your coverage without requesting a current illustration. You may annually request, without charge, such an illustration by calling [insurers phone number], writing to [insurers address] address], accessing [insurers internet website address], or contacting your agent. If you do not receive a current illustration of your policy within thirty days from your request, you should contact your state insurance department. The insurer may vary the sequential order of the methods for obtaining an in force illustration.(c) Upon the request of the policy owner, the insurer shall furnish an in force illustration of current and future benefits and values based on the insurers present illustrated scale. This illustration shall comply with the requirements of subdivisions (a) and (b) of Section 10509.955 and subdivisions (a) and (e) of Section 10509.956. No A signature or any other acknowledgment of receipt of this illustration shall not be required.(d) If an adverse change in nonguaranteed elements that could affect the policy has been made by the insurer since the last annual report, the annual report shall contain a notice of that fact and the nature of the change prominently displayed.
SECTION 1. Section 10509.959 of the Insurance Code is amended to read:
### SECTION 1.
10509.959. (a) In the case of a policy designated as one for which illustrations will be used, the insurer shall provide each policy owner with an annual report on the status of the policy that shall include, but not be limited to, the following information:(1) For universal life policies, the report shall include the following:(A) The beginning and end date of the current report period.(B) The policy value at the end of the previous report period and at the end of the current report period.(C) The total amounts that have been credited or debited to the policy value during the current report period, identifying each by type, including, but not limited to, interest, mortality, expense expense, and riders.(D) The current death benefit at the end of the current report period on each life covered by the policy.(E) The net cash surrender value of the policy as of the end of the current report period.(F) The amount of outstanding loans, if any, as of the end of the current report period.(G) For fixed premium policies:If, assuming guaranteed interest, mortality and expense loads and continued scheduled premium payments, the policys net cash surrender value is such that it would not maintain insurance in force until the end of the next reporting period, a notice to this effect shall be included in the report.(H) For flexible premium policies:If, assuming guaranteed interest, mortality and expense loads, the policys net cash surrender value will not maintain insurance in force until the end of the next reporting period unless further premium payments are made, a notice to this effect shall be included in the report.(2) For all other policies, the report shall include the following, where as applicable:(A) Current death benefit.(B) Annual contract premium.(C) Current cash surrender value.(D) Current dividend.(E) Application of current dividend.(F) Amount of outstanding loan.(3) Insurers writing life insurance policies that do not build nonforfeiture values shall only be required to provide an annual report with respect to these policies for those years when a change has been made to nonguaranteed policy elements by the insurer.(b) If the annual report does not include an in force illustration, it shall contain the following notice displayed prominently: IMPORTANT POLICY OWNER NOTICE: You should consider requesting more detailed information about your policy to understand how it may perform in the future. You should not consider replacement of your policy or make changes in your coverage without requesting a current illustration. You may annually request, without charge, such an illustration by calling [insurers phone number], writing to [insurers address] address], accessing [insurers internet website address], or contacting your agent. If you do not receive a current illustration of your policy within thirty days from your request, you should contact your state insurance department. The insurer may vary the sequential order of the methods for obtaining an in force illustration.(c) Upon the request of the policy owner, the insurer shall furnish an in force illustration of current and future benefits and values based on the insurers present illustrated scale. This illustration shall comply with the requirements of subdivisions (a) and (b) of Section 10509.955 and subdivisions (a) and (e) of Section 10509.956. No A signature or any other acknowledgment of receipt of this illustration shall not be required.(d) If an adverse change in nonguaranteed elements that could affect the policy has been made by the insurer since the last annual report, the annual report shall contain a notice of that fact and the nature of the change prominently displayed.
10509.959. (a) In the case of a policy designated as one for which illustrations will be used, the insurer shall provide each policy owner with an annual report on the status of the policy that shall include, but not be limited to, the following information:(1) For universal life policies, the report shall include the following:(A) The beginning and end date of the current report period.(B) The policy value at the end of the previous report period and at the end of the current report period.(C) The total amounts that have been credited or debited to the policy value during the current report period, identifying each by type, including, but not limited to, interest, mortality, expense expense, and riders.(D) The current death benefit at the end of the current report period on each life covered by the policy.(E) The net cash surrender value of the policy as of the end of the current report period.(F) The amount of outstanding loans, if any, as of the end of the current report period.(G) For fixed premium policies:If, assuming guaranteed interest, mortality and expense loads and continued scheduled premium payments, the policys net cash surrender value is such that it would not maintain insurance in force until the end of the next reporting period, a notice to this effect shall be included in the report.(H) For flexible premium policies:If, assuming guaranteed interest, mortality and expense loads, the policys net cash surrender value will not maintain insurance in force until the end of the next reporting period unless further premium payments are made, a notice to this effect shall be included in the report.(2) For all other policies, the report shall include the following, where as applicable:(A) Current death benefit.(B) Annual contract premium.(C) Current cash surrender value.(D) Current dividend.(E) Application of current dividend.(F) Amount of outstanding loan.(3) Insurers writing life insurance policies that do not build nonforfeiture values shall only be required to provide an annual report with respect to these policies for those years when a change has been made to nonguaranteed policy elements by the insurer.(b) If the annual report does not include an in force illustration, it shall contain the following notice displayed prominently: IMPORTANT POLICY OWNER NOTICE: You should consider requesting more detailed information about your policy to understand how it may perform in the future. You should not consider replacement of your policy or make changes in your coverage without requesting a current illustration. You may annually request, without charge, such an illustration by calling [insurers phone number], writing to [insurers address] address], accessing [insurers internet website address], or contacting your agent. If you do not receive a current illustration of your policy within thirty days from your request, you should contact your state insurance department. The insurer may vary the sequential order of the methods for obtaining an in force illustration.(c) Upon the request of the policy owner, the insurer shall furnish an in force illustration of current and future benefits and values based on the insurers present illustrated scale. This illustration shall comply with the requirements of subdivisions (a) and (b) of Section 10509.955 and subdivisions (a) and (e) of Section 10509.956. No A signature or any other acknowledgment of receipt of this illustration shall not be required.(d) If an adverse change in nonguaranteed elements that could affect the policy has been made by the insurer since the last annual report, the annual report shall contain a notice of that fact and the nature of the change prominently displayed.
10509.959. (a) In the case of a policy designated as one for which illustrations will be used, the insurer shall provide each policy owner with an annual report on the status of the policy that shall include, but not be limited to, the following information:(1) For universal life policies, the report shall include the following:(A) The beginning and end date of the current report period.(B) The policy value at the end of the previous report period and at the end of the current report period.(C) The total amounts that have been credited or debited to the policy value during the current report period, identifying each by type, including, but not limited to, interest, mortality, expense expense, and riders.(D) The current death benefit at the end of the current report period on each life covered by the policy.(E) The net cash surrender value of the policy as of the end of the current report period.(F) The amount of outstanding loans, if any, as of the end of the current report period.(G) For fixed premium policies:If, assuming guaranteed interest, mortality and expense loads and continued scheduled premium payments, the policys net cash surrender value is such that it would not maintain insurance in force until the end of the next reporting period, a notice to this effect shall be included in the report.(H) For flexible premium policies:If, assuming guaranteed interest, mortality and expense loads, the policys net cash surrender value will not maintain insurance in force until the end of the next reporting period unless further premium payments are made, a notice to this effect shall be included in the report.(2) For all other policies, the report shall include the following, where as applicable:(A) Current death benefit.(B) Annual contract premium.(C) Current cash surrender value.(D) Current dividend.(E) Application of current dividend.(F) Amount of outstanding loan.(3) Insurers writing life insurance policies that do not build nonforfeiture values shall only be required to provide an annual report with respect to these policies for those years when a change has been made to nonguaranteed policy elements by the insurer.(b) If the annual report does not include an in force illustration, it shall contain the following notice displayed prominently: IMPORTANT POLICY OWNER NOTICE: You should consider requesting more detailed information about your policy to understand how it may perform in the future. You should not consider replacement of your policy or make changes in your coverage without requesting a current illustration. You may annually request, without charge, such an illustration by calling [insurers phone number], writing to [insurers address] address], accessing [insurers internet website address], or contacting your agent. If you do not receive a current illustration of your policy within thirty days from your request, you should contact your state insurance department. The insurer may vary the sequential order of the methods for obtaining an in force illustration.(c) Upon the request of the policy owner, the insurer shall furnish an in force illustration of current and future benefits and values based on the insurers present illustrated scale. This illustration shall comply with the requirements of subdivisions (a) and (b) of Section 10509.955 and subdivisions (a) and (e) of Section 10509.956. No A signature or any other acknowledgment of receipt of this illustration shall not be required.(d) If an adverse change in nonguaranteed elements that could affect the policy has been made by the insurer since the last annual report, the annual report shall contain a notice of that fact and the nature of the change prominently displayed.
10509.959. (a) In the case of a policy designated as one for which illustrations will be used, the insurer shall provide each policy owner with an annual report on the status of the policy that shall include, but not be limited to, the following information:
(1) For universal life policies, the report shall include the following:
(A) The beginning and end date of the current report period.
(B) The policy value at the end of the previous report period and at the end of the current report period.
(C) The total amounts that have been credited or debited to the policy value during the current report period, identifying each by type, including, but not limited to, interest, mortality, expense expense, and riders.
(D) The current death benefit at the end of the current report period on each life covered by the policy.
(E) The net cash surrender value of the policy as of the end of the current report period.
(F) The amount of outstanding loans, if any, as of the end of the current report period.
(G) For fixed premium policies:
If, assuming guaranteed interest, mortality and expense loads and continued scheduled premium payments, the policys net cash surrender value is such that it would not maintain insurance in force until the end of the next reporting period, a notice to this effect shall be included in the report.
(H) For flexible premium policies:
If, assuming guaranteed interest, mortality and expense loads, the policys net cash surrender value will not maintain insurance in force until the end of the next reporting period unless further premium payments are made, a notice to this effect shall be included in the report.
(2) For all other policies, the report shall include the following, where as applicable:
(A) Current death benefit.
(B) Annual contract premium.
(C) Current cash surrender value.
(D) Current dividend.
(E) Application of current dividend.
(F) Amount of outstanding loan.
(3) Insurers writing life insurance policies that do not build nonforfeiture values shall only be required to provide an annual report with respect to these policies for those years when a change has been made to nonguaranteed policy elements by the insurer.
(b) If the annual report does not include an in force illustration, it shall contain the following notice displayed prominently: IMPORTANT POLICY OWNER NOTICE: You should consider requesting more detailed information about your policy to understand how it may perform in the future. You should not consider replacement of your policy or make changes in your coverage without requesting a current illustration. You may annually request, without charge, such an illustration by calling [insurers phone number], writing to [insurers address] address], accessing [insurers internet website address], or contacting your agent. If you do not receive a current illustration of your policy within thirty days from your request, you should contact your state insurance department. The insurer may vary the sequential order of the methods for obtaining an in force illustration.
(c) Upon the request of the policy owner, the insurer shall furnish an in force illustration of current and future benefits and values based on the insurers present illustrated scale. This illustration shall comply with the requirements of subdivisions (a) and (b) of Section 10509.955 and subdivisions (a) and (e) of Section 10509.956. No A signature or any other acknowledgment of receipt of this illustration shall not be required.
(d) If an adverse change in nonguaranteed elements that could affect the policy has been made by the insurer since the last annual report, the annual report shall contain a notice of that fact and the nature of the change prominently displayed.
In estimating a loss under an open policy of marine insurance, the following rules are to be observed:
(a)The value of a ship is its value at the beginning of the risk, including all articles or charges that add to its permanent value or that are necessary to prepare it for the voyage insured.
(b)The value of cargo is either its actual cost to the insured, when laden on board, or, where that cost can not be ascertained, its market value at the time and place of lading, adding the charges incurred in purchasing and placing it on board, but without reference to:
(1)Any losses incurred in raising money for its purchase.
(2)Any drawback on its exportation.
(3)The fluctuations of the market at the port of destination.
(4)Expenses incurred on the way or on arrival.
(c)The value of freightage is the gross freightage, exclusive of primage, without reference to the cost of earning it.
(d)The cost of insurance is in each case to be added to the value thus estimated.