Nev. Admin. Code § 688A.200 - Rate of interest for determination
1. Except as
otherwise provided in subsection 2, for the purposes of
NRS
688A.363, the rate of interest used to
determine the minimum nonforfeiture amount must be an annual rate of interest
determined as the lesser of:
(a) The
statutorily provided rate of 3 percent per annum; or
(b) A rate equal to 125 basis points less
than the 5-Year Treasury Constant Maturity Rate as reported by the Federal
Reserve rounded to the nearest 0.05 of a percent:
(1) If a date is specified in a contract for
the determination of the interest rate, on the date specified in the contract;
or
(2) If a period is specified in
a contract for the determination of the interest rate, the average rate for the
period specified in the contract.
2. A deferred annuity contract that provides
for the substantive participation in an equity indexed benefit may provide that
the rate calculated pursuant to paragraph (b) of subsection 1 may be reduced by
up to an additional 100 basis points. The amount of an additional reduction to
the interest rate must not exceed the value of the equity indexed benefit. The
Commissioner may require an insurer to substantiate that the additional
reduction to the interest rate does not exceed the value of the equity indexed
benefit. If the Commissioner finds that the additional reduction to the
interest rate exceeds the value of the equity indexed benefit, the Commissioner
may disallow or limit the amount of the additional reduction.
3. If the rate calculated pursuant to
paragraph (b) of subsection 1 or subsection 2 is less than 1 percent per annum,
the interest rate used to determine the minimum nonforfeiture amount must be 1
percent per annum.
4. For the
purposes of subparagraphs (1) and (2) of paragraph (b) of subsection 1, the
date or period specified in a contract for the determination of the 5-Year
Treasury Constant Maturity Rate shall be a date or period between the effective
date of the interest rate and 15 months prior to the effective date of the
interest rate.
5. Except as
otherwise provided in subsection 4, the interest rate calculated pursuant to
NRS
688A.363 and this section must apply for the
term of the deferred annuity contract.
6. A deferred annuity contract may provide
for a redetermination of the interest rate used to determine the minimum
nonforfeiture amount. Any redetermination of the interest rate must be made
pursuant to subsections 1 and 2. If the deferred annuity contract provides that
the interest rate used to determine the minimum nonforfeiture amount will be
redetermined, the contract shall set forth:
(a) The dates upon which a redetermination
will be made;
(b) The periods for
which a redetermined rate will apply; and
(c) The method that will be used for a
redetermination.
7. As
used in this section, "basis point" means one-hundredth of 1 percent of
yield.
Notes
NRS 679B.130, 688A.363
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