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(a)
GUARANTEE OF PREMIUMS AND INTEREST BY THE UNITED STATES-
(1) GUARANTEE- Payment of premiums, and interest on premiums at the
rate specified in section 406, which become due on a policy under the
protection of this title is guaranteed by the United States. If the amount
guaranteed is not paid to the insurer before the period of insurance
protection under this title expires, the amount due shall be treated
by the insurer as a policy loan on the policy.
(2) POLICY TERMINATION- If, at the expiration of insurance protection
under this title, the cash surrender value of a policy is less than the
amount due to pay premiums and interest on premiums on the policy, the
policy shall terminate. Upon such termination, the United States shall
pay the insurer the difference between the amount due and the cash surrender
value.
(b) RECOVERY FROM INSURED OF AMOUNTS PAID BY THE UNITED STATES-
(1) DEBT PAYABLE TO THE UNITED STATES- The amount paid by the United
States to an insurer under this title shall be a debt payable to the
United States by the insured on whose policy payment was made.
(2) COLLECTION- Such amount may be collected by the United States,
either as an offset from any amount due the insured by the United States
or as otherwise authorized by law.
(3) DEBT NOT DISCHARGEABLE IN BANKRUPTCY- Such debt payable to the
United States is not dischargeable in bankruptcy proceedings.
(c) CREDITING OF AMOUNTS RECOVERED- Any amounts received by the United
States as repayment of debts incurred by an insured under this title
shall be credited to the appropriation for the payment of claims under
this title.
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408 - Regulations
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