Mich. Admin. Code R. 500.865 - Reports to policyholders
Rule 25. Any insurer delivering or issuing for delivery in this state any variable life insurance policies shall mail to each variable life insurance policyholder, at his or her last known address, all of the following statements, notice, report, and information:
(a) Within 30 days after each anniversary of
the policy, a statement or statements of all of the following:
(i) The cash surrender value.
(ii) Death benefit.
(iii) Any partial withdrawal.
(iv) Any policy loan.
(v) Any interest charge.
(vi) Any optional payments allowed under the
policy pursuant to
R 500.851 computed as of the policy
anniversary date. Such statement may be furnished within 30 days after a
specified date in each policy year if the information contained therein is
computed as of a date not more than 65 days before the mailing of such notice.
This statement shall state that, in accordance with the investment experience
of the separate account, the cash values and the variable death benefit may
increase or decrease and the statement shall prominently identify any value
described therein which may be recomputed before the next statement required by
this rule. If the policy guarantees that the variable death benefit on the next
policy anniversary date will not be less than the variable death benefit
specified in such statement, the statement shall be modified to so indicate.
For flexible premium policies, the statement shall contain a reconciliation of
the change since the previous statement in cash value and cash surrender value,
if different, because of payments made, less deductions for expense charges;
withdrawals; investment experience; insurance charges; and any other charges
made against the cash value. In addition, the statement shall show the
projected cash value and cash surrender value, if different, as of 1 year from
the end of the period covered by the statement assuming that planned periodic
premiums, if any, are paid as scheduled, guaranteed costs of insurance are
deducted, and the net return is equal to the guaranteed rate or, in the absence
of a guaranteed rate, is not more than zero. If the projected value is less
than zero, a warning message shall be included that states that the policy may
be in danger of terminating without value in the next 12 months unless
additional premium is paid.
(b) Annually, a statement or statements
including all of the following information:
(i) A summary of the financial statement of
the separate account, including a calculation of the net investment return,
based on the annual statement last filed with the commissioner.
(ii) The net investment return of the
separate account for the most recent year and, for each year after the first, a
comparison of the investment rate of the separate account during the most
recent year with the investment rate during prior years, up to a total of 5
years, when available.
(iii) A list
of investments held by the separate account as of a date not earlier than the
end of the last year for which an annual statement was filed with the
commissioner.
(iv) Any charges,
taxes, and brokerage fees determined on an accrual basis payable by the
separate account during the previous year, each expressed as a dollar amount
and a percentage and the total expressed as a dollar amount and as a percentage
of the assets of the separate account.
(v) A statement of any change in any of the
following since the last statement:
(A) The
investment objective and orientation of the separate account.
(B) Any investment restriction or material
quantitative or qualitative investment requirement applicable to the separate
account.
(C) The investment adviser
of the separate account.
(vi) The name of each broker or dealer
handling portfolio transactions on behalf of the separate account in which the
insurer or an affiliate has any material interest, directly or indirectly, and
the nature of such transactions and the amount of compensation received by each
such broker or dealer from business originating with the separate account
during the preceding fiscal year.
(vii) The names and principal occupations of
each principal executive officer and each director of the insurer.
(viii) The names of all parents of the
insurer and the basis of control of the insurer, and the name of any person who
is known to own, of record or beneficially, 10% or more of the outstanding
voting securities of the company.
(c) Notwithstanding the requirements in
subdivision (b) of this rule, a notice of any change in investment policy of
the separate account, pursuant to
R 500.859, shall be provided not
later than 6 months from the effective date of that change. This requirement
shall be considered satisfied if an annual report containing such notice is
provided not later than 6 months from the effective date of the change or if a
substantially similar notice is made pursuant to any federal securities laws
not later than 6 months from the effective date.
(d) For flexible premium policies, a
statement shall be sent to the policyholder if the amounts available under the
policy, on any policy processing day, to pay the charges authorized by the
policy are less than the amount necessary to keep the policy in force until the
next following policy processing day. The statement shall indicate the minimum
payment required under the terms of the policy to keep it in force and the
length of the grace period for payment of such amount.
(e) Such additional information concerning
the variable life insurance operations or the variable life insurance separate
accounts as the commissioner shall deem appropriate.
Notes
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