- NAIC Adopts Revisions to Actuarial Guideline 49
- December 19, 2016 | Authors: Eric A. Arnold; Frederick R. Bellamy; Thomas E. Bisset; Dodie C. Kent; Clifford E. Kirsch
- Law Firms: Sutherland Asbill & Brennan LLP - Washington Office; Sutherland Asbill & Brennan LLP - New York Office
On December 13, the National Association of Insurance Commissioners (NAIC) Executive (EX) Committee and Plenary adopted revisions to Actuarial Guideline 49 (AG 49) with an effective date of March 1, 2017. The revisions apply AG 49’s standards for determining the maximum annual rate of index-based interest that can be used to calculate values in illustrations for indexed universal life (IUL) insurance policies, to all IUL policies, including in-force IUL policies sold prior to September 1, 2015. Currently, the standards apply only to illustrations for IUL policies sold on or after September 1, 2015.
As adopted by the Life Actuarial (A) Task Force in November, the revisions were scheduled to become effective on July 1, 2017. However, at the Life and Annuity (A) Committee meeting, a request was made that the effective date be moved to March 1, 2017. One participant requested that the effective date be adopted as proposed voicing concern that issuers of IUL policies should be given time to implement the changes required by AG 49 for in-force illustrations.
Notwithstanding that request, the (A) Committee adopted the revisions to AG 49 as proposed except with a change in the effective date from July 1 to March 1, 2017. As noted above, the NAIC Executive (EX) Committee and Plenary subsequently adopted the revisions to AG 49.