The national guide covers the standard life policy provisions, nonforfeiture, dividend and settlement options, and riders. Iowa's state questions on life policies draw on several sources:

• Iowa Code chapters 508 and 511: incontestability, policy loans and interest on death claims.
• Chapter 509: group life.
• 191 IAC chapters 14–16: illustrations, the free look and replacement.
• 191 IAC chapter 28: credit insurance.
• Chapter 508E: viatical settlements.

National concepts in brief

• Grace period, reinstatement, misstatement of age, entire contract and incontestability are the standard required provisions.
• Nonforfeiture options: cash surrender, reduced paid-up, and extended term.
• Common riders: waiver of premium, accidental death, guaranteed insurability, and accelerated benefits.

Individual life rules in Iowa

• Incontestability: after two years in force during the insured's lifetime, a life policy is incontestable except for nonpayment of premium (Iowa Code 508.28). Iowa's statute has no fraud exception.
• Free look: 10 days after receipt, with a prompt premium refund (191 IAC 15.9). A replacement gets 30 days.
• Buyer's guide and policy summary: given at or before delivery. A compliant illustration can take the place of the policy summary (191 IAC 15.4(3)).
• Small face amount policies (initial face of $15,000 or less) need a disclosure if total premiums may exceed the face amount (191 IAC 15.52).
• Policy loan interest (Iowa Code 511.36):
  • The rate is either a fixed maximum of 8% a year, or an adjustable rate tied to a published bond index and reset at least yearly but no more than every three months.
  • The owner is told the rate when a loan is made, and gets advance notice of any increase.
• Delayed death claims: proceeds not paid within 30 days earn interest from the date proof of death was received (Iowa Code 511.38). The rate is the higher of the policy loan rate or the rate paid on proceeds left on deposit. No interest is due if the beneficiary chooses a settlement option other than a lump sum.

Insurable interest and consent

• Charities: a 501(c)(3) charity has an insurable interest when the insured donates to it, names it beneficiary, or applies jointly with it (Iowa Code 511.39).
• Employer-owned life insurance requires each employee's written consent, including acknowledgment that the coverage may continue after employment ends (Iowa Code 511.40).

Illustrations (191 IAC chapter 14)

• An illustration must be labeled "life insurance illustration."
• It may not imply that non-guaranteed elements are guaranteed, or use terms like "vanishing premium."
• If the policy is issued differently than illustrated, a "Revised Illustration" is signed by the applicant and producer no later than delivery.
• Illustrations are kept until three years after the policy ends.
• Not covered by the rule: variable life, annuities, credit life, and policies with an initial face amount of $10,000 or less.

Replacement (191 IAC chapter 16)

• Producer: presents and reads the replacement notice no later than when the application is taken, and leaves copies of the sales material.
• Replacing insurer:
  • notifies the existing insurer within 5 business days;
  • gives a 30-day right to return;
  • credits time already served under the old policy's incontestability and suicide periods;
  • keeps signed notices for five years.
• Existing insurer: provides policy information within 5 business days of the owner's request.
• Financed purchase: using existing values 4 months before to 13 months after the new policy's effective date is presumed to be one.
• Exempt: non-convertible term expiring in five years or less, and credit life.
• Penalties: license action, fines and forfeiture of commissions.

Group life (Iowa Code 509.1–509.2)

Eligibility:

• Amounts must follow a plan that precludes individual selection.
• A labor union group must cover at least 10 members at issue. A multiple-employer or union trust must cover at least 100 persons.

Required provisions (Iowa Code 509.2):

• Grace period: 31 days, with death benefit coverage continuing during it.
• Incontestability: a member's statements can't be used after coverage has been in force two years during the member's lifetime. Statements are representations, not warranties.
• Facility of payment: up to $500 for funeral or last-illness expenses.

Conversion:

• On leaving the group, the member has 31 days to apply for an individual policy of any form the insurer customarily issues except term.
• If the group policy itself ends, the conversion amount may be limited to $2,000.
• If the member dies during the conversion period, the convertible amount is paid as a group claim.

Assignment is allowed, but the insurer isn't bound until it receives written notice (Iowa Code 509.15).

Credit life (191 IAC chapter 28; Iowa Code 509.1(3))

• The creditor must offer the debtor the option of using existing coverage or any authorized insurer.
• All plans are disclosed before the debtor is obligated. The policy or certificate is delivered within 30 days of the debt.
• Free examination: 15 days, printed on the cover.
• Group credit life may not exceed the debt, and never more than $200,000.
• Refunds of $1 or less need not be made.

Viatical settlements (chapter 508E)

• A viatical settlement broker represents only the viator and owes the viator a fiduciary duty.
• The viator may rescind until the earlier of 30 days after signing or 15 days after receiving the proceeds.
• Settlements are generally prohibited within five years of policy issue, subject to listed exceptions.

Common exam traps

• Life incontestability: 2 years, nonpayment is the only exception.
• Free look: 10 days, or 30 on a replacement. Credit insurance gets a 15-day free examination.
• Group life has a 31-day grace period and 31 days to convert. Conversion is to any form except term.
• Interest on delayed death claims starts after 30 days, counted from receipt of proof of death.
• The fixed loan interest cap is 8%.