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Maine Bureau of Insurance
Form Filing Review Requirements Checklist
Variable Annuities

A03G, A03I, A06G, A06I, A07G.002, A07I.002, A10
(Amended 11/2011)

REVIEW REQUIREMENTS

REFERENCE                                             

DESCRIPTION OF REVIEW STANDARDS REQUIREMENTS

LOCATION OF STANDARD IN FILING

Standards of Suitability

Rule 310
Article V § 3

No insurer or agent shall recommend to an applicant a VA policy if, on the basis of information furnished after reasonable inquiry of such applicant, that such policy is unsuitable to applicant. (Insurance, investment objectives, affordability, risk aversion, etc.)

 

Mandatory Design

Rule 310
Article VI § 2

Statement of essential features of the procedures to be followed by the insurer in determining the dollar amount of any variable benefits required. A statement is required on the first page that the benefits are on a variable basis. Projections of past investment experience into the future investment experience are not allowed in the contract.
Grace period of thirty (30) days or one (1) month is required for stipulated payments. Contract must remain in force during the grace period.
Policy may be reinstated within one year from the date of default unless the cash value has been paid out.
Insurer may require overdue payments and indebtedness including interest.
Contract shall stipulate investment factors to be used in computing the dollar amount of variable benefits and any guarantee that expense and/or mortality results shall not adversely affect such dollar amounts. In the case of an individual VA contract where the M&E results may adversely affect the dollar amount of benefits, the assumed M&E factors shall be stipulated in the contract.
In computing the dollar amount of variable benefits or other contractual payments or values under an individual VA contract (1) The annual net investment increment assumption shall not exceed 6% except with the approval of the superintendent; and (2) to the extent that the level of benefits may be affected by future mortality results, the mortality factor shall be determined from the Annuity Mortality Tables mandated for the valuation of individual annuities contained in the Standard Valuation Law.

 

Non-forfeiture Benefits

Rule 310
Article VI § 3

Non forfeiture Benefits
Policies issued after January 1, 1985 will be granted a paid-up annuity benefit.
For further information, please refer to Article VI § 3 with regard to standard non forfeiture benefits.
Provisions of this section shall not apply to any reinsurance, group annuity contract purchased in connection with one or more retirement plans or plans of deferred compensation established or maintained by or for one or more employers (including partnerships or sole proprietorships), employee organizations, or any combination thereof See Section 3b for full exemptions

 

Separate Accounts – Full Payment of Annuity Death Benefits

24-A M.R.S.A. §2537, Sub. 10

This section of Maine insurance law permits a variable annuity contract to include as an incidental benefit a provision for payment on death during the deferred period of an amount equal to the greater of the sum of the premiums or stipulated  payments paid under the contract and the value of the contract at the time of death. Payment of any other amount to the beneficiary is prohibited. Payment on death must be made in accordance with the prompt pay law.

 

Disclosure of All Charges

Rule 310
Article VIII § 7

An insurer must disclose in writing, prior to or contemporaneously with delivery of the policy, all charges that may be made to against the separate account such as taxes, brokerage fees, acquisition and sales costs, cost of insurance, administrative and investment management expenses, M&E guarantees, cost of incidental benefits.

 

Reports to Policyholders

Rule 310
Article IX

Reports to Policyholders: Each contract year after the first including Report of Accumulation Units

 

Annual Contract Charge

Rule 310
Article VI
 § 3(d)(e)

Annual Contract Charge $30.  The annual contract charge may be more than $30.00.  See this section for exceptions.

 

AIDS and Medical Lifestyle Standards

Rule 490

The purpose of this rule is to clarify the standards applicable to written informed consent forms required to be completed by persons required to take a test for the presence of the antibody to the Human Immunodeficiency Virus (HIV) or for the Human Immunodeficiency Antigen by an insurer, nonprofit hospital service organization, nonprofit medical service organization, or a nonprofit health care plan, to establish standards for pretest and post-test counseling required to be provided to persons subject to testing as required by 5 M.R.S.A. Section 19203-A, and to establish standards for medical and lifestyle application questions and underwriting.

 

Last Updated: August 22, 2012