
From the U.S. Code Online via GPO Access
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[Laws in effect as of January 23, 2000]
[Document not affected by Public Laws enacted between
  January 23, 2000 and December 4, 2001]
[CITE: 38USC1904]

 
                      TITLE 38--VETERANS' BENEFITS
 
                        PART II--GENERAL BENEFITS
 
                          CHAPTER 19--INSURANCE
 
              SUBCHAPTER I--NATIONAL SERVICE LIFE INSURANCE
 
Sec. 1904. Plans of insurance

    (a) Insurance may be issued on the following plans: Five-year level 
premium term, ordinary life, twenty-payment life, thirty-payment life, 
twenty-year endowment, endowment at age sixty, and endowment at age 
sixty-five. Level premium term insurance may be converted as of the date 
when any premium becomes or has become due, or exchanged as of the date 
of the original policy, upon payment of the difference in reserve, at 
any time while such insurance is in force and within the term period to 
any of the foregoing permanent plans of insurance, except that 
conversion to an endowment plan may not be made while the insured is 
totally disabled.
    (b) Under such regulations as the Secretary may promulgate a policy 
of participating insurance may be converted to or exchanged for 
insurance issued under this subsection on a modified life plan. 
Insurance issued under this subsection shall be on the same terms and 
conditions as the insurance which it replaces, except (1) the premium 
rates for such insurance shall be based on the 1958 Commissioners 
Standard Ordinary Basic Table of Mortality and interest at the rate of 3 
per centum per annum; (2) all cash, loan, paid-up, and extended values 
shall be based on the 1958 Commissioners Standard Ordinary Basic Table 
of Mortality and interest at the rate of 3 per centum per annum; and (3) 
at the end of the day preceding the sixty-fifth birthday of the insured 
the face value of the modified life insurance policy or the amount of 
extended term insurance thereunder shall be automatically reduced by 
one-half thereof, without any reduction in premium.
    (c) Under such regulations as the Secretary may promulgate, a policy 
of nonparticipating insurance may be converted to or exchanged for 
insurance issued under this subsection on a modified life plan. 
Insurance issued under this subsection shall be on the same terms and 
conditions as the insurance which it replaces, except that (1) term 
insurance issued under section 621 of the National Service Life 
Insurance Act of 1940 shall be deemed for the purposes of this 
subsection to have been issued under section 1923(b) of this title; and 
(2) at the end of the day preceding the sixty-fifth birthday of the 
insured the face value of the modified life insurance policy or the 
amount of extended term insurance thereunder shall be automatically 
reduced by one-half thereof, without any reduction in premium. Any 
person eligible for insurance under section 1922(a), or section 1925 of 
this title may be granted a modified life insurance policy under this 
subsection which, subject to exception (2) above, shall be issued on the 
same terms and conditions specified in section 1922(a) or section 1925, 
whichever is applicable.
    (d) Any insured whose modified life insurance policy is in force by 
payment or waiver of premiums on the day before the insured's sixty-
fifth birthday may upon written application and payment of premiums made 
before such birthday be granted National Service Life Insurance, on an 
ordinary life plan, without physical examination, in an amount of not 
less than $500, in multiples of $250, but not in excess of one-half of 
the face amount of the modified life insurance policy in force on the 
day before the insured's sixty-fifth birthday. Insurance issued under 
this subsection shall be effective on the sixty-fifth birthday of the 
insured. The premium rate, cash, loan, paid-up, and extended values on 
the ordinary life insurance issued under this subsection shall be based 
on the same mortality tables and interest rates as the insurance issued 
under the modified life policy. Settlements on policies involving 
annuities on insurance issued under this subsection shall be based on 
the same mortality or annuity tables and interest rates as such 
settlements on the modified life policy. If the insured is totally 
disabled on the day before the insured's sixty-fifth birthday and 
premiums on the insured's modified life insurance policy are being 
waived under section 1912 of this title or the insured is entitled on 
that date to waiver under such section the insured shall be 
automatically granted the maximum amount of insurance authorized under 
this subsection and premiums on such insurance shall be waived during 
the continuous total disability of the insured.
    (e) After June 30, 1972, and under such regulations as the Secretary 
may promulgate, insurance may be converted to or exchanged for insurance 
on a modified life plan under the same terms and conditions as are set 
forth in subsections (b) and (c) of this section except that at the end 
of the day preceding the seventieth birthday of the insured the face 
value of the modified life insurance policy or the amount of extended 
insurance thereunder shall be automatically reduced by one-half thereof, 
without any reduction in premium. Any insured whose modified life 
insurance policy issued under this subsection is in force by payment or 
waiver of premiums on the day before the insured's seventieth birthday 
may be granted insurance on the ordinary life plan upon the same terms 
and conditions as are set forth in subsection (d) of this section except 
that in applying such provisions the seventieth birthday is to be 
substituted for the sixty-fifth birthday. Notwithstanding any other 
provision of law or regulations the Secretary under such terms and 
conditions as the Secretary determines to be reasonable and practicable 
and upon written application and payment of the required premiums, 
reserves, or other necessary amounts made within one year from the 
effective date of this subsection by an insured having in force a 
modified life plan issued under subsection (b) or (c) of this section, 
including any replacement insurance issued under subsection (d) of this 
section or other provision of this title, can exchange such insurance 
without proof of good health for an amount of insurance issued under 
this subsection equal to the insurance then in force or which was in 
force on the day before such insured's sixty-fifth birthday, whichever 
is the greater.

(Pub. L. 85-857, Sept. 2, 1958, 72 Stat. 1148, Sec. 704; Pub. L. 88-664, 
Sec. 12(b), Oct. 13, 1964, 78 Stat. 1098; Pub. L. 92-193, Dec. 15, 1971, 
85 Stat. 648; Pub. L. 97-295, Sec. 4(21), Oct. 12, 1982, 96 Stat. 1306; 
Pub. L. 99-576, title VII, Sec. 701(21), Oct. 28, 1986, 100 Stat. 3292; 
renumbered Sec. 1904 and amended Pub. L. 102-83, Secs. 4(b)(1), (2)(E), 
5(a), (c)(1), Aug. 6, 1991, 105 Stat. 404-406.)

                       References in Text

    Section 621 of the National Service Life Insurance Act of 1940, 
referred to in subsec. (c), is section 621 of act Oct. 8, 1940, ch. 757, 
title VI, pt. I, as added Apr. 25, 1951, ch. 39, pt. II, Sec. 10, 65 
Stat. 36, which was repealed and the provisions thereof reenacted as 
section 723 [now 1923] of this title by Pub. L. 85-857, Sept. 2, 1958, 
72 Stat. 1105.


                            Prior Provisions

    Prior section 1904 was renumbered section 3904 of this title.
    Another prior section 1904, Pub. L. 85-857, Sept. 2, 1958, 72 Stat. 
1216, related to prohibition against duplication of benefits, prior to 
the general revision of chapter 39 of this title by Pub. L. 91-666, 
Sec. 2(a), Jan. 11, 1971, 84 Stat. 1998. See section 3903 of this title.


                               Amendments

    1991--Pub. L. 102-83, Sec. 5(a), renumbered section 704 of this 
title as this section.
    Subsec. (b). Pub. L. 102-83, Sec. 4(b)(1), (2)(E), substituted 
``Secretary'' for ``Administrator''.
    Subsec. (c). Pub. L. 102-83, Sec. 5(c)(1), substituted ``1923(b)'' 
for ``723(b)'', ``1922(a)'' for ``722(a)'' in two places, and ``1925'' 
for ``725'' in two places.
    Pub. L. 102-83, Sec. 4(b)(1), (2)(E), substituted ``Secretary'' for 
``Administrator''.
    Subsec. (d). Pub. L. 102-83, Sec. 5(c)(1), substituted ``1912'' for 
``712''.
    Subsec. (e). Pub. L. 102-83, Sec. 4(b)(1), (2)(E), substituted 
``Secretary'' for ``Administrator'' wherever appearing.
    1986--Subsec. (d). Pub. L. 99-576, Sec. 701(21)(A), substituted 
``the insured's'' for ``his'' in four places, and ``the insured'' for 
``he'' in two places.
    Subsec. (e). Pub. L. 99-576, Sec. 701(21)(B), substituted ``the 
insured's'' for ``his'' and ``the Administrator'' for ``he''.
    1982--Subsec. (e). Pub. L. 97-295 substituted ``After June 30, 
1972,'' for ``On and after the effective date of this subsection'', and 
substituted ``subsection'' for ``subsections'' after ``plan issued 
under''.
    1971--Subsec. (e). Pub. L. 92-193 added subsec. (e).
    1964--Pub. L. 88-664 designated existing provisions as subsec. (a) 
and added subsecs. (b) to (d).


                    Effective Date of 1971 Amendment

    Pub. L. 92-193 provided that the amendment made by Pub. L. 92-193 is 
effective first day of first calendar month which begins more than six 
calendar months after Dec. 15, 1971.


                    Effective Date of 1964 Amendment

    Amendment by Pub. L. 88-664 effective first day of first calendar 
month which begins more than six calendar months after Oct. 13, 1964, 
see section 12(d) of Pub. L. 88-664, set out as an Effective Date note 
under section 1925 of this title.
