
From the U.S. Code Online via GPO Access
[wais.access.gpo.gov]
[Laws in effect as of January 23, 2000]
[Document not affected by Public Laws enacted between
  January 23, 2000 and December 4, 2001]
[CITE: 38USC1907]

 
                      TITLE 38--VETERANS' BENEFITS
 
                        PART II--GENERAL BENEFITS
 
                          CHAPTER 19--INSURANCE
 
              SUBCHAPTER I--NATIONAL SERVICE LIFE INSURANCE
 
Sec. 1907. Payment or use of dividends

    (a) Until and unless the Secretary has received from the insured a 
request or directive in writing exercising any other dividend option 
allowable under the insured's policy, any dividend accumulations and 
unpaid dividends shall be applied in payment of premiums becoming due on 
insurance subsequent to the date the dividend is payable after January 
1, 1952.
    (b) No claim by an insured for payment in cash of a special dividend 
declared prior to January 1, 1952, shall be processed by the Secretary 
unless such claim was received within six years after such dividend was 
declared. Whenever any claim for payment of a special dividend, the 
processing of which is barred by this subsection, is received by the 
Secretary, it shall be returned to the claimant, with a copy of this 
subsection, and such action shall be a complete response without further 
communication.
    (c) The Secretary, upon application in writing made by the insured 
for insurance under this subsection, and without proof of good health, 
is authorized to apply any dividend due and payable on national service 
life insurance after the date of such application to purchase paid up 
insurance. Also, the Secretary, upon application in writing made by the 
insured during the one-year period beginning September 1, 1991, and 
without proof of good health, is authorized to apply any national 
service life insurance dividend credits and deposits of such insured 
existing at the date of the insured's application to purchase paid up 
insurance. After September 1, 1992, the Secretary may, from time to 
time, provide for further one-year periods during which insureds may 
purchase additional paid up insurance from existing dividend credits and 
deposits. Any such period for the purchase of additional paid up 
insurance may be allowed only if the Secretary determines in the case of 
any such period that it would be actuarially and administratively sound 
to do so. Any dividends, dividend credits, or deposits on endowment 
policies may be used under this subsection only to purchase additional 
paid up endowment insurance which matures concurrently with the basic 
policy. Any dividends, dividend credits, or deposits on policies (other 
than endowment policies) may be used under this section only to purchase 
additional paid up whole life insurance. The paid up insurance granted 
under this subsection shall be in addition to any insurance otherwise 
authorized under this title, or under prior provisions of law. The paid 
up insurance granted under this subsection shall be issued on the same 
terms and conditions as are contained in the standard policies of 
national service life insurance except (1) the premium rates for such 
insurance and all cash and loan values thereon shall be based on such 
table of mortality and rate of interest per annum as may be prescribed 
by the Secretary; (2) the total disability income provision authorized 
under section 1915 of this title may not be added to insurance issued 
under this section; and (3) the insurance shall include such other 
changes in terms and conditions as the Secretary determines to be 
reasonable and practicable.

(Pub. L. 85-857, Sept. 2, 1958, 72 Stat. 1149, Sec. 707; Pub. L. 91-291, 
Sec. 9, June 25, 1970, 84 Stat. 331; Pub. L. 92-188, Sec. 2, Dec. 15, 
1971, 85 Stat. 645; Pub. L. 97-295, Sec. 4(22), Oct. 12, 1982, 96 Stat. 
1306; Pub. L. 99-576, title VII, Sec. 701(23), Oct. 28, 1986, 100 Stat. 
3292; renumbered Sec. 1907 and amended Pub. L. 102-83, 
Secs. 4(a)(2)(A)(iii)(I), (C)(i), (b)(1), (2)(E), 5(a), (c)(1), Aug. 6, 
1991, 105 Stat. 403-406; Pub. L. 102-86, title II, Sec. 203, Aug. 14, 
1991, 105 Stat. 416.)


                               Amendments

    1991--Pub. L. 102-83, Sec. 5(a), renumbered section 707 of this 
title as this section.
    Subsec. (a). Pub. L. 102-83, Sec. 4(a)(2)(A)(iii)(I), substituted 
``Secretary'' for ``Veterans' Administration''.
    Subsec. (b). Pub. L. 102-83, Sec. 4(a)(2)(C)(i), substituted ``by 
the Secretary'' for ``in the Veterans' Administration'' in second 
sentence.
    Pub. L. 102-83, Sec. 4(a)(2)(A)(iii)(I), substituted ``Secretary'' 
for ``Veterans' Administration'' in first sentence.
    Subsec. (c). Pub. L. 102-86 amended subsec. (c) of this section as 
in effect before the redesignations made by Pub. L. 102-83, Sec. 5, by 
substituting ``during the one-year period beginning September 1, 1991'' 
for ``before February 1, 1973'' and inserting after second sentence 
``After September 1, 1992, the Secretary may, from time to time, provide 
for further one-year periods during which insureds may purchase 
additional paid up insurance from existing dividend credits and 
deposits. Any such period for the purchase of additional paid up 
insurance may be allowed only if the Secretary determines in the case of 
any such period that it would be actuarially and administratively sound 
to do so.''
    Pub. L. 102-83, Sec. 5(c)(1), substituted ``1915'' for ``715'' in 
cl. (2).
    Pub. L. 102-83, Sec. 4(b)(1), (2)(E), substituted ``Secretary'' for 
``Administrator'' wherever appearing.
    1986--Subsecs. (a), (c). Pub. L. 99-576 substituted ``the 
insured's'' for ``his''.
    1982--Subsec. (c). Pub. L. 97-295 substituted ``before February 1, 
1973'' for ``within six calendar months after the effective date of this 
subsection''.
    1971--Pub. L. 92-188, Sec. 2(3), substituted ``Payment or use of 
dividends'' for ``Dividends to pay premiums'' as section catchline.
    Subsec. (a). Pub. L. 92-188, Sec. 2(1), substituted ``or directive 
in writing exercising any other dividend option allowable under his 
policy'' for ``in writing for payment in cash''.
    Subsec. (c). Pub. L. 92-188, Sec. 2(2), added subsec. (c).
    1970--Pub. L. 91-291 designated existing provisions as subsec. (a) 
and added subsec. (b).


                    Effective Date of 1971 Amendment

    Section 4 of Pub. L. 92-188 provided that: ``The amendments made by 
this Act [amending this section and sections 703 and 741 [now 1903 and 
1941] of this title] shall take effect on a date established by the 
Administrator but in no event later than the first day of the first 
calendar month which begins more than six calendar months after the date 
of enactment of this Act [Dec. 15, 1971].''


                    Effective Date of 1970 Amendment

    Amendment by Pub. L. 91-291 effective June 25, 1970, see section 
14(a) of Pub. L. 91-291, set out as a note under section 1317 of this 
title.

                  Section Referred to in Other Sections

    This section is referred to in sections 1903, 1941 of this title.
