such children, nor shall they have any voice in the management of the society. The total benefits payable as above provided, shall in no case exceed the following amounts, at ages at next birthday at time of death, respectively as follows: Two, $34.00; three, $40.00; four, $48.00; five, $58.00; 8x, $140.00; seven, $168.00; eight, $200.00; nine, $240.00; ten, $300.00; eleven, $380.00; twelve, $460.00; thirteen to fifteen, $520.00; sixteen to eighteen years, where not otherwise authorized by law, $600.00.

§2. No benefit certificate as to any child shall take effect until after medical examination or inspection, in accordance with the laws of the society, nor shall any such benefit certificate be issued unless the society shall simultaneously put in force at least five hundred (500) such certificates, on each of which at least one (1) assessment has been paid, nor where the number of lives represented by such certificates falls below five hundred (500). The death benefit contributions to be made upon such certificate shall be based upon "Standard Industrial Mortality Table→ or the "English Life Table Number 6," and a rate of interest not greater than four (4) per cent per annum, or upon a higher standard: Proved, that contributions may be waived or returns may be made

from

any surplus held in excess of reserve and other liabilities, as provided in the by-laws: And, provided, further, that extra contributions shall be made if the reserves hereafter provided for become impaired.

2c. Any society entering into such insurance agreement shall maintain on all such contracts the reserve required by the standard of mortality and interest adopted by the society for computing contributious as provided in section 2b, and the funds represented in the benefit Cotributions, and all accretions thereon, shall be kept as separate and distinct funds, independent of the other funds of the society, and shall not be liable for, nor used for the payment of the debts, and obligations of the society other than the benefits herein authorized: Provided, that

society may provide that when a child reaches the minimum age for initiation into membership in such society, any benefit certificate issued hereunder may be surrendered for cancellation and exchanged for any Other form of certificate issued by the society: Provided, that such surrender will not reduce the number of lives insured in the branch below five hundred (500) and upon the issuance of such new certificate any reserve upon the original certificate herein provided for, shall be transferred to the credit of the new certificate. Neither the person who originally made application for benefits on account of such child nor the beneficiary named in such original certificate, nor the person who paid. the contribution, shall have any vested right in such new certificate, the free nomination of the beneficiary under the new certificate being left to the child so admitted to benefit membership.

§ 2d. An entirely separate financial statement of the business transactions and of assets and liabilities arising therefrom shall be made in its annual report to the Insurance Superintendent by any society availing itself of the provisions hereof. The separation of assets, funds and liabilities required hereby shall not be terminated, rescinded or modified,

nor shall the funds be diverted for any use other than as specified in section three (3), as long as any certificates issued hereunder remain in any liquidation, reinsurance, merger or other change in the condition of the status of the society.

certificate issued hereunder for specified payments on account of the § 2e. Any society shall have the right to provide in its laws and the expense or general fund, which payment shall, or shall not be mingled with the general fund of the society as its constitution and by-laws may

provide.

§ 2f. In the event of the termination of membership in the society by the person responsible for the support of any child, on whose account a certificate may have been issued, as provided herein, the certificate the contributions are continued, or for the benefit of any other person responsible for the support and maintenance of such child, who shall assume the payment of the required contributions.

APPROVED June 25, 1917.

LIFE COMPANIES-WHAT NOT TO INSURE.

§ 1. Amends section 18, Act of 1869.

§ 18. What life companies not to insure exceptions-what deemed life policies.

(HOUSE BILL No. 508. APPROVED JUNE 11, 1917.)

AN ACT to amend section eighteen (18) of an Act entitled, "An Act to organize and regulate the business of life insurance," approved March 26, 1869, in force July 1, 1869.

SECTION 1. Be it enacted by the People of the State of Illinois. represented in the General Assembly: That section eighteen (18) of an Act entitled, "An Act to organize and regulate the business of life insur ance," approved March 26, 1869, in force July 1, 1869, be and the same is hereby amended so as to read as follows:

§ 18. No life insurance company organized under the laws of this State shall issue policies insuring fire or marine or live stock risks nor do any banking business nor, except as otherwise provided by law, transact the business of accident or health insurance, and no insurance company organized under the laws of any other state or country shall, in addition to the business of life insurance, transact the business of acci dent and health insurance, or either of them, in this State, unless so authorized by its charter or by the laws under which it is organized and upon compliance with the laws of this State relating to such insurance. but policies of life or endowment insurance which contain provisions operating, in the event that the insured shall become totally and perma nently disabled from any cause, to safeguard the insurance against lape or to grant a special surrender value or an annuity payable for a limited period or during the life of the insured, or which contain provisions granting insurance against death by accident, shall nevertheless be deemed to be policies of life or endowment insurance within the intent of this Act.

APPROVED June 11, 1917.

LIFE INSURANCE-POLICY PROVISIONS.

1. Amends section 1, Act of 1907.

(HOUSE BILL No. 700.

§ 1. Payment of premiums. APPROVED JUNE 22, 1917.)

AN ACT to amend section 1 of an Act entitled, "An Act relating to the transaction of the business of life insurance in the State of Illinois, and regulating the conditions and provisions of policies of life insurance companies, organized under the laws of this State, or doing business herein," approved May 20, 1907, in force January 1, 1908.

SECTION 1. Be it enacted by the People of the State of Illinois, represented in the General Assembly: That section 1 of an Act entitled, "An Act relating to the transaction of the business of life insurance in the State of Illinois, and regulating the conditions and provisions of policies of life insurance companies, organized under the laws of this State, or doing business herein," approved May 20, 1907, in force January 1, 1908, be and the same is hereby amended so that said section 1, as amended, shall read as follows:

§ 1. That from and after January 1, 1908, no policy of life insurance shall be issued or delivered in this State or be issued by a life insurance company organized under the laws of this State, unless the same shall provide the following:

(1) That all premiums after the first shall be payable in advance, either at the home office of the company or to an agent of the company, upon delivery of a receipt signed by one or more of the officers who shall be designated in the policy.

(2) For a grace of one month for the payment of every premium after the first year which may be subject to an interest charge, during which month the insurance shall continue in force: Provided, that if the insured shall die within the month of grace the unpaid premium for the current policy year may be deducted in any settlement under the policy.

(3) That the policy, together with the application therefor, a copy of which application shall be endorsed upon or attached to the policy and made a part thereof, shall constitute the entire contract between the parties and shall be incontestable after two years from its date, except for non-payment of premiums and except for violations of the conditions of the policy relating to the naval or military service in time of war: Provided, that the application therefor need not be attached to any policy containing a clause making the policy incontestable from date of issue.

(4) That if the age of the insured has been misstated the amount payable under the policy shall be such as the premium would have purchased at the correct age, or the premium may be adjusted and credit given to the insured or to the company, according to the company's published rate at date of issue.

(5a) That the policy shall participate in the surplus of the company, and any policy containing provision for participation at the end of the first policy year, and annually thereafter, may also provide that each dividend shall be paid subject to the payment of the premium for the next ensuing year; and the insured under any annual dividend policy

shall have the right each year to have the dividend arising from such participation paid in cash, and if the policy shall provide other dividends options, it shall further provide that if the insured shall not elect any such other options, the dividend shall be paid in cash. Such participation may, however, begin not later than the end of the twentieth policy

year.

(5b) If any company shall issue any policies under the terms of which the payment of dividends is deferred later than the third policy year, such company shall furnish the Department of Trade and Commerce each year a statement showing the number and amount of all policies with deferred dividends in force at the beginning of the year for which the statement is made; of all such policies issued and revived or terminated during the said year with the mode of termination; and the number and amount of all such policies in force at the end of said year. Also a statement showing any and all amounts provisionally set apart, ascertained or calculated or held awaiting apportionment upon such policies at the beginning of said year, the additions made to the said fund during the year, with the source from which such additions arose, the deductions made from the said funds during the year, with the reasons therefor and the amount of said fund at the end of the year; which shall be carried as a distinct and separate liability to such class of policies on and for which the sum was accumulated. Upon the written request of the insured under any deferred dividend policy, after said policy shall have been in force more than three years, the company shall furnish said policy holder with a statement of the amount of surplus provisionally ascertained or set aside on such policy and held awaiting apportionment at the expiration of the deferred dividend period.

(5c) The provisions of the preceding paragraphs numbered (5a) and (5b) of this section shall not apply to any form of paid-up insurance or temporary insurance or pure endowment insurance, issued or granted in exchange for lapsed or surrendered policies, or to non-participating policies; provided, however, that if any company shall issue any non-participating policy under the terms of which any stipulated part of premiums received is to be placed in a separate fund for subsequent apportionment, such company shall furnish the Department of Trade and Commerce each year a statement showing the number and amount of all such policies in force at the beginning of the year for which the statement is made; of all such policies issued and revived or terminated during the said year with the mode of termination; and the number and amount of all such policies in force at the end of said year. Also a statement showing any and all amounts provisionally set apart, ascertained or calculated or held awaiting apportionment upon such policies, according to classes, at the beginning of said year, the additions made to the said fund during the year with the source from which such additions arose, the deductions made from the said fund (if permitted by the contract) during the year with the reasons therefor and the amount of said fund at the end of the year; which shall be carried as a distinct and separate reserve liability of the company for the benefit of the classes of policies from the premium payments on which the sum

was accumulated. No part of said fund prior to the time of distribution stipulated in the contract, shall be considered in determining the loan and cash and other surrender values provided for by this Act. Upon written request of the insured under any such policy, after said policy shall have been in force more than three years, the company shall furnish said policyholder with a statement of the amount of the contingent interest of said policyholder in the fund so accumulated and held awaiting apportionment at the expiration of the accumulation period. No such policy shall be issued which by its terms shall provide that more than twenty-five per cent of the annual premium shall be placed in such fund, nor shall any such provision be made a part of a term insurance policy.

(6) That after three full years' premiums have been paid, the company, at any time, while the policy is in force, will loan, on the execution of a proper note or loan agreement by the insured, and on proper assignment and delivery of the policy and on the sole security thereof, at a specified rate of interest, a sum equal to, or at the option of the insured less than, the reserve at the end of the current policy year on the policy and on the dividend additions thereto, if any, (the policy to specify the mortality table and the rate of interest adopted for computing such reserve), less a specified percentage (not more than two and one-half) of the amount insured by the policy and of the dividend additions thereto, if any, and that the company will deduct from such loan value any existing indebtedness on or secured by the policy and any unpaid balance of the premium for the current policy year, and may collect interest in advance on the loan to the end of the current policy year: Provided, that such loan may be deferred for not exceeding six months after the application therefor is made. No condition other than is herein provided shall be exacted as a prerequisite to any such loan. This provision shall not be required in term insurance, nor shall it apply to temporary insurance or pure endowment insurance, issued or granted in exchange for lapsed or surrendered policies.

(7) That in event of default in premium payments, after premiums shall have been paid for three years, the insured shall be entitled to a stipulated form of insurance the net value of which shall be at least equal to the reserve at the date of default on the policy and on dividend additions thereto, if any, (the policy to specify the mortality table and rate of interest adopted for computing such reserve), less a specified percentage (not more than two and a half) of the amount insured by the policy and of existing dividend additions thereto, if any, and less any existing indebtedness to the company on or secured by the policy: Provided, that the policy may be surrendered to the company at its home office within one month of date of default for a specified cash value at least equal to the sum which would otherwise be available for the purchase of insurance as aforesaid: And, provided, further, that the company may defer payment for not more than six months after the application therefor is made. This provision shall not be required in term insurance of twenty years or less.