PUBLIC LAWS-CH. 888-OCT. 17, 1940 Restriction as to unpaid premiums. Outstanding loans. Applicants for bene- fits to be listed. Notice of rejection or approval. Reduction of poli- cies exceeding $5,000, etc. No lapses for non- payment during serv- ice period. Proviso. Limitation. Insurance corpora- tions, etc. Monthly reports. Names of appli- cants; face value of policies. Unpaid premiums. Defaulted pre- miums paid. Computation of monthly difference. companies, when such contracts were made and a premium was paid thereon before the date of approval of this Act or not less than thirty days before entry into the military service; but in no event shall the provisions of this article apply to any policy on which premiums are due and unpaid for a period of more than one year at the time when application for the benefits of this article is made or in respect of any policy on which there is outstanding a policy loan or other indebt- edness equal to or greater than 50 per centum of the cash surrender value of the policy. SEC. 403. The Veterans' Administration shall, subect to regulations, which shall be prescribed by the Administrator of Veterans' Affairs, compile and maintain a list of such persons in military service as have made application for the benefits of this article, and shall (1) reject any application for such benefits made by persons who are not persons in military service; (2) reject any applications for such bene- fits in excess of the amount permitted by section 402; and (3) reject any applications in respect of contracts of insurance otherwise not entitled to the benefits of this article. Said Administration shall immediately notify the insurer and the insured in writing of every rejection or approval. SEC. 404. When one or more applications are made under this article by any one person in military service in respect of insurance exceed- ing a total face value of $5,000, whether on one or more policies or in one or more companies, and the insured shall not in his application indicate an order of preference, the Veterans' Administration shall reject such policies as have the inferior cash surrender value, so as to reduce the total benefits conferred within the face value of $5,000, and where necessary for this purpose shall direct the insurer to divide any policy into two separate policies. The said Administration shall immediately notify the insurer and the insured in writing of such selection. SEC. 405. No policy which has not lapsed for the nonpayment of premium before the commencement of the period of military service of the insured, and which has been brought within the benefits of this article, shall lapse or be forfeited for the nonpayment of premium during the period of such service or during one year after the expira- tion of such period: Provided, That in no case shall this prohibition extend for more than one year after the date when this Act ceases to be in force. SEC. 406. Within the first fifteen days of each calendar month after the date of approval of this Act until the expiration of one year after the date when this Act ceases to be in force every insurance corpora- tion or association to which application has been made as herein pro- vided, for the benefits of this article, shall render to the Veterans' Administration a report, duly verified, setting forth the following facts: First. The names of the persons who have applied for such benefits and the face value of the policies in respect of which such benefits have been applied for by such persons, during the preceding calendar month. Second. A list as far as practicable of the premiums in respect of policies entitled to the benefits of this article, which remain unpaid on the last day of the preceding calendar month, which day is at least thirty-one days after the due date of the premiums, provided such premiums have not previously been so reported as in default. Third. A list of premiums which, having been previously reported as in default, have been paid by the policyholder or someone on his behalf in whole or in part during the preceding calendar month. Fourth. A computation of the difference between the total amount of defaulted premiums therein reported and the total amount of 1184 [54 STA.T.