33-20-117. Nonforfeiture rights -- policies issued before operative date. (1) This section applies only to policies of life insurance issued prior to the operative date of 33-20-213.
(2) In the event of default in payment of any premium due on any policy, if not less than 3 full years' premiums have been paid, there must be secured to the insured, without action on the insured's part, either paid-up or extended insurance as specified in the policy, the net value of which must be at least equal to the entire net reserve held by the insurer of the policy, less 2 1/2% of the amount insured by the policy and dividend additions, if any, and less any outstanding indebtedness to the insurer on the policy at the time of default. There must be secured to the insured the right to surrender the policy to the insurer at its home office within 1 month after the date of default for cash value otherwise available for the purchase of the paid-up or extended insurance.