DURING the National Association of Insurance Commissioners' winter meeting, the group adopted the annuity nonforfeiture model regulation, a resolution on limited line term life insurance, and the extension of the sunset provision of Actuarial Guideline 39, which establishes reserves for variable annuities with guaranteed living benefits.
The non-forfeiture model was designed to implement changes to the Standard Nonforfeiture Law for Individual Deferred Annuities. These changes were adopted in 2003. The new model revises the 3 percent non-forfeiture rate to allow a five-year constant maturity Treasury rate, which is subject to a 3 percent ceiling and a 1 percent floor, and permits a lower minimum non-forfeiture interest rate for equity-indexed annuities subject to the same conditions.
The change to the SNL is in response to declining interest rates.
