Unless its cash surrender value has already been paid, an individual annuity subject to Hawaii's...

B. 1 year is correct. Hawaiʻi's standard provisions for annuity and pure endowment contracts provide a reinstatement right that differs from the corresponding reinstatement period for an individual life insurance policy. Under HRS §431:10D-105, an eligible annuity contract may generally be reinstated within one year from the date of default in making stipulated payments , provided its cash surrender value has not already been paid.

To reinstate, overdue stipulated payments and applicable contract indebtedness must be paid or reinstated. Interest may be charged at the rate specified in the contract, subject to a statutory ceiling of 6% per year compounded annually . When appropriate to the type of contract, the insurer may also require satisfactory evidence of insurability.

The key examination distinction is between the one-year annuity reinstatement period and the three-year reinstatement period applicable to an individual life insurance policy under HRS §431:10D-102. Treating these periods as interchangeable would produce an incorrect answer.

Six months is shorter than the statutory period. Two and three years exceed the standard annuity reinstatement period described in §431:10D-105.

Reference topics: HRS §431:10D-105; Annuity Reinstatement; Default; Cash Surrender Value; Life versus Annuity Provisions.

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