How soon must an insurance company notify policyholders about changes in determining nonguaranteed elements?

An insurance company must notify policyholders about changes in determining nonguaranteed elements no later than the first payment on the new basis because this requirement ensures that policyholders are directly informed of any significant changes that affect how their benefits will be calculated moving forward. Nonguaranteed elements, which may include things like interest rates or dividends, can have a substantial impact on the overall value of the policy. Providing notification at the time of the first payment allows policyholders to understand exactly what to expect based on the revised terms and empowers them to make informed decisions regarding their coverage. This approach promotes transparency and trust between the insurer and the policyholder, ensuring that individuals have up-to-date information on the terms of their insurance policy.