Commonwealth Consolidated Acts Commonwealth Consolidated Acts(1) In this section, the standard formula , in relation to a contract of life insurance means the formula
"S" is the number of dollars that is equal to the sum insured (including any bonuses).
"P" is the number of dollars that is equal to the premium that has, or to the sum of the premiums that have, become payable under the contract; and
"Q" is the number of dollars that is equal to the premium, or to the sum of the premiums, that would have become payable under the contract if it or they had been ascertained on the basis of the correct date of birth or dates of birth.
(2) If the date of birth of one or more of the life insureds under a contract of life insurance was not correctly stated to the insurer at the time when the contract was entered into:
(a) where the sum insured (including any bonuses) exceeds the amount in dollars ascertained in accordance with the standard formula--the insurer may at any time vary the contract by substituting for the sum insured (including any bonuses) an amount that is not less than the amount in dollars so ascertained; and
(b) where the sum insured (including any bonuses) is less than the amount so ascertained, the insurer shall either:
(i) reduce, as from the date on which the contract was entered into, the premium payable to the amount that would have been payable if the contract had been based on the correct date of birth or correct dates of birth and repay the amount of overpayments of premium (less any amount that has been paid as the cash value of bonuses in excess of the cash value that would have been paid if the contract had been based on the correct date of birth or correct dates of birth) together with interest on that amount at the prescribed rate computed from the date on which the contract was entered into; or
(ii) vary the contract by substituting for the sum insured (including any bonuses) the amount in dollars so ascertained.
(3) In the application of subsection (2) in relation to a contract that provides for periodic payments, the sum insured means each such payment (including any bonuses).
(a) the expiration date of a contract of life insurance is calculated by reference to the date of birth of a person who is a life insured under the contract; and
(b) the person's date of birth was not correctly stated to the insurer at the time when the contract was entered into;
then the insurer may (instead of doing any of the things referred to in subsection (2)) vary the contract by changing its expiration date to the date that would have been the expiration date if the contract had been based on the correct date of birth.
(4) A variation of a contract under subsection (2) or
(3A) has effect from the time when the contract was entered into.
