(a) Initial Filing Requirements. The
following information shall be submitted in connection with any filing of
interest-indexed universal life insurance policies ("interest-indexed
policies"). All such information received shall be treated confidentially to
the extent permitted by law.
(i) A
description of how the interest credits are determined, including:
(A) a description of the index;
(B) the relationship between the value of the
index and the actual interest rate to be credited;
(C) the frequency and timing of determining
the interest rate; and
(D) the
allocation of interest credits, if more than one rate of interest applies to
different portions of the policy value.
(ii) The insurer's investment policy, which
includes a description of the following:
(A)
how the insurer addressed the reinvestment risks;
(B) how the insurer plans to address the risk
of capital loss on cash outflows;
(C) how the insurer plans to address the risk
that appropriate investments may not be available or not available in
sufficient quantities;
(D) how the
insurer plans to address the risk that the indexed interest rate may fall below
the minimum contractual interest rate guaranteed in the policy;
(E) the amount and type of assets currently
held for interest indexed policies; and
(F) the amount and type of assets expected to
be acquired in the future.
(iii) If policies are linked to an index for
a specified period less than to the maturity date of the policy, a description
of the method used (or currently contemplated) to determine interest credits
upon the expiration of such period.
(iv) A description of any interest guarantee
in addition to or in lieu of the index.
(v) A description of any maximum premium
limitations and the conditions under which they apply.
(b) Additional Filing Requirements.
(i) Annually, every insurer shall submit a
Statement of Actuarial Opinion by the insurer's actuary similar to the example
contained in subsection (c) of this section.
(ii) Annually, every insurer shall submit a
description of the amount and type of assets currently held by the insurer with
respect to its interest-indexed policies.
(iii) Prior to implementation, every domestic
insurer shall submit a description of any material change in the insurer's
investment strategy or method of determining the interest credits. A change is
considered to be material if it would affect the form or definition of the
index (i.e. any change in the information supplied in subsection (a) above) or
if it would significantly change the amount or type of assets held for
interest-indexed policies.
(c) Statement of Actuarial Opinion for
Interest-Indexed Universal Life Insurance Policies.
I,______________________,
am____________________________________________ (name) (position or relationship
to Insurer) for the XYZ Life Insurance Company (The Insurer) in the state of
___________________ (1.) (State of Domicile of Insurer) I am a member of the
American Academy of Actuaries (or if not, state other qualifications to sign
annual statement actuarial opinions).
I have examined the interest-indexed universal life insurance
policies of the Insurer in force as of December 31, 20XX, encompassing
____________number of policies and $ ____________of insurance in force.
I have considered the provisions of the policies. I have
considered any reinsurance agreements pertaining to such policies, the
characteristics of the identified assets and the investment policy adopted by
the Insurer as they affect future insurance and investment cash flows under
such policies and related assets. My examination included such tests and
calculations as I considered necessary to form an opinion concerning the
insurance and investment cash flows arising from the policies and related
assets.
I relied on the investment policy of the Insurer and on
projected investment cash flows as provided by ____________, Chief Investment
Officer of the Insurer.
The tests were conducted under various assumptions as to
future interest rates, and particular attention was given to those provisions
and characteristics that might cause future insurance and investment cash flows
to vary with changes in the level and prevailing interest rates.
In my opinion, the anticipated insurance and investment cash
flows referred to above make good and sufficient provision for the contractual
obligations of the Insurer under these insurance policies.
________________________
Signature of Actuary
