Ins 2.20 HistoryHistory: Emerg. cr. eff. 5-19-84; cr. Register, August, 1984, No. 344, eff. 9-1-84; r. (6) under s. 13.93 (2m) (b) 16., Stats., Register, December, 1984, No. 348; renum. (3)(c), (d), (e), (4)(a) and (b) to be (3)(c)1., (d)1., (e)1., (4)(a)1. and (b)1. and am. (4)(a)1. and (b)1., cr. (3)(c)2., (d)2., (e)2., (f), (4)(a)2. and (b)2., Register, November, 1988, No. 395, eff. 12-1-88. Ins 2.30Ins 2.30 Annuity mortality tables. Ins 2.30(1)(1) Purpose. The purpose of this section is to adopt, pursuant to s. 623.06 (2a) (b) and (d), Stats., mortality tables for use in determining the minimum standard of valuation for annuity and pure endowment contracts. Ins 2.30(2)(a)(a) “1983 GAM table” means those male and female group annuity mortality tables adopted for the valuation of group annuity and pure endowment contracts in December of 1983 by the NAIC and published on pages 414-415, NAIC proceedings, vol. I, 1984. Ins 2.30(2)(b)(b) “1983 table ‘a’” means that mortality table adopted for the valuation of individual annuity and pure endowment contracts in June of 1982 by the NAIC and published on page 454, NAIC proceedings, vol. II 1982. Ins 2.30(2)(c)(c) “1994 GAR table” means the group annuity reserving table adopted for the valuation of group annuity and pure endowment contracts in December of 1996 by the NAIC as published on pages 866 and 867, vol. XLVII, transactions, society of actuaries, 1995. Ins 2.30(2)(d)(d) “2012 Individual Annuity Mortality Period Life Table” or “2012 IAM Period Table” means the Period Table containing loaded mortality rates for calendar year 2012. This table contains rates, qx2012, developed by the society of actuaries committee on life insurance research, and published in the 2012 proceedings of the NAIC, Fall Volume I, pages 149-150. Ins 2.30(2)(e)(e) “2012 IAR Table” means that generational mortality table developed by the society of actuaries committee on life insurance research and containing rates, qx2012+n, derived from a combination of the 2012 IAM Period Table and Projection Scale G2, using the methodology stated in Section 3m. Ins 2.30(2)(f)(f) “Annuity 2000 mortality table” means those male and female mortality tables adopted for the valuation of individual annuity and pure endowment contracts in December of 1996 by the NAIC as published on page 240, vol. XLVII, transactions, society of actuaries, 1995. Ins 2.30(2)(g)(g) “Generational mortality table” means a mortality table containing a set of mortality rates that decrease for a given age from one year to the next based on a combination of a Period table and a projection scale containing rates of mortality improvement. Ins 2.30(2)(h)(h) “NAIC” means the national association of insurance commissioners. Ins 2.30(2)(i)(i) “Period table” means a table of mortality rates applicable to a given calendar year. Ins 2.30(2)(j)(j) “Projection Scale G2” or “Scale G2” is a table of annual rates, G2x, of mortality improvement by age for projecting future mortality rates beyond calendar year 2012. This table was developed by the society of actuaries committee on life insurance research, and published in the 2012 proceedings of the NAIC, Fall Volume I, pages 151-152. Ins 2.30(3)(3) Individual annuity or pure endowment contracts. Ins 2.30(3)(a)(a) The 1983 table ‘a’ may be used to determine the minimum standard of valuation for any individual annuity or pure endowment contract issued on or after November 8, 1977 but before January 1, 1986. Ins 2.30(3)(b)(b) Either the 1983 table ‘a’ or the annuity 2000 mortality table shall be used to determine the minimum standard of valuation for any individual annuity or pure endowment contract issued on or after January 1, 1986 but before January 1, 1999. Ins 2.30(3)(c)(c) Except as provided in par. (d) the annuity 2000 mortality table shall be used to determine the minimum standard of valuation for any individual annuity or pure endowment contract issued on or after January 1, 1999, but before January 1, 2015. Ins 2.30(3)(cm)(cm) Except as provided in par. (d) the 2012 IAR Table may be used to determine the minimum standard of valuation for any individual annuity or pure endowment contract issued on or after January 1, 2015. For any individual annuity or pure endowment contract issued on or after January 1, 2016, the 2012 IAR Table shall be used. Ins 2.30(3)(d)(d) The 1983 table a without projection shall be used for determining the minimum standards of valuation for an individual annuity or pure endowment contract issued on or after January 1, 1999 when the contract is based on life contingencies and is issued to fund periodic benefits arising from any of one of the following: Ins 2.30(3)(d)1.1. Settlements of various forms of claims pertaining to court settlements or out of court settlements from tort actions. Ins 2.30(3)(d)2.2. Settlements involving similar actions such as worker’s compensation claims. Ins 2.30(3)(d)3.3. Settlements of long term disability claims where a temporary or life annuity has been used in lieu of continuing disability payments. Ins 2.30(3m)(a)(a) In using the 2012 IAR Table, the mortality rate for a person age x in year (2012 + n) is calculated as follows: Ins 2.30(3m)(b)(b) The resulting qx 2012+n shall be rounded to three decimal places per 1,000, e.g., 0.741 deaths per 1,000. The rounding shall occur according to the formula in par. (a), starting at the 2012 period table rate. Ins 2.30 NoteNote: For example, for a male age 30, qx 2012 = 0.741.
qx 2013 = 0.741 * (1 – 0.010) ^ 1 = 0.73359, which is rounded to 0.734.
qx 2014 = 0.741 * (1 – 0.010) ^ 2 = 0.7262541, which is rounded to 0.726.
Ins 2.30 NoteNote: A method leading to incorrect rounding would be to calculate qx 2014 as qx 2013 * (1 – 0.010), or 0.734 * 0.99 = 0.727. It is incorrect to use the already rounded qx 2013 to calculate qx 2014.
Ins 2.30(4)(4) Group annuity or pure endowment contracts. Ins 2.30(4)(a)(a) Either the 1983 GAM table, the 1983 table ‘a’, or the 1994 GAR table may be used to value any annuity or pure endowment purchased on or after November 8, 1977 but before January 1, 1986 under a group annuity or pure endowment contract. Ins 2.30(4)(b)(b) Either the 1983 GAM table or the 1994 GAR table shall be used to determine the minimum standard of valuation for any annuity or pure endowment contract purchased on or after January 1, 1986 but before January 1, 1999 under a group annuity or pure endowment contract. Ins 2.30(4)(c)(c) The 1994 GAR table shall be used for determining the minimum standard of valuation for any annuity or pure endowment contract purchased on or after January 1, 1999 under a group annuity or pure endowment contract. Ins 2.30(5)(a)(a) In using the 1994 GAR table the mortality rate for a person age x in year (1994 + n) is calculated as follows: qx 1994+n = qx 1994 (1-AAx) n
Ins 2.30 HistoryHistory: Cr. Register, November, 1985, No. 359, eff. 12-1-85; am. Register, October, 1998, No. 514, eff. 1-1-99; CR 14-076: r. and recr. (2), am. (3) (c), cr. (3) (cm), (3m) Register August 2015 No. 716, eff. 9-1-15. Ins 2.35Ins 2.35 Smoker and nonsmoker mortality tables for minimum reserve liabilities and minimum nonforfeiture benefits. Ins 2.35(1)(1) Purpose. This section implements ss. 623.06 (2) (am) 3. and 632.43 (6m) (e) 3. f., Stats., by permitting the use of mortality tables that reflect differences in mortality between smokers and nonsmokers. These mortality tables are used in determining minimum reserve liabilities and minimum cash surrender values and amounts of paid-up nonforfeiture benefits for plans of insurance with separate premium rates for smokers and nonsmokers. Ins 2.35(2)(a)(a) “1980 CSO table, with or without 10-year select mortality factor” means that mortality table, consisting of separate rates of mortality for male and female lives, incorporated in ss. 623.06 (2) (am) 3 and 632.43 (6m) (e) 3. f., Stats., and referred to in those statutes as the commissioner’s 1980 standard ordinary mortality table, with or without 10-year select mortality factors. Ins 2.35(2)(b)(b) “1980 CET table” means that mortality table consisting of separate rates of mortality for male and female lives incorporated in ss. 623.06 (2) (am) 3. and 632.43 (6m) (e) 3. f., Stats., and referred to in those statutes as the commissioner’s 1980 extended term insurance table. Ins 2.35(2)(c)(c) “1980 CSO smoker and nonsmoker mortality tables” means the mortality tables with separate rates of mortality for smokers and nonsmokers derived from the tables defined in par. (a), and adopted by the National Association of Insurance Commissioners in December 1983. Ins 2.35 NoteNote: Mortality rates for these tables are published on pp. 406-413, Proceedings of the National Association of Insurance Commissioners, 1984 Vol. I.
Ins 2.35(2)(d)(d) “1980 CET smoker and nonsmoker mortality tables” means the mortality tables with separate rates of mortality for smokers and nonsmokers derived from the tables defined in par. (b), and adopted by the National Association of Insurance Commissioners in December 1983. Ins 2.35 NoteNote: Mortality rates for these tables are published on pp. 406-413, Proceedings of the National Association of Insurance Commissioners, 1984 Vol. I.
Ins 2.35(2)(e)(e) “Composite mortality tables” means the mortality tables defined in pars. (a) and (b), as originally published with rates of mortality that do not distinguish between smokers and nonsmokers. Ins 2.35(3)(3) Alternate tables. At the option of the company and subject to the condition that the company use the same select factors for both smoker and nonsmoker tables, and the conditions stated in sub. (4), for any policy of insurance delivered or issued for delivery in this state after the operative date of s. 632.43 (6m) (h), Stats., for that policy form: Ins 2.35(3)(a)(a) The company may substitute the 1980 CSO smoker and nonsmoker mortality tables, with or without 10-year select mortality factors for the 1980 CSO table, with or without 10-year select mortality factors, for use in determining minimum reserve liabilities, minimum cash surrender values and amounts of paid-up nonforfeiture benefits; and Ins 2.35(3)(b)(b) The company may substitute the 1980 CET smoker and nonsmoker mortality tables for the 1980 CET Table for use in determining minimum reserve liabilities, minimum cash surrender values and amounts of paid-up nonforfeiture benefits. Ins 2.35(4)(4) Conditions. For each plan of insurance with separate rates for smokers and nonsmokers the company may: Ins 2.35(4)(a)(a) Use composite mortality tables to determine minimum reserve liabilities, minimum cash surrender values and amounts of paid-up nonforfeiture benefits; Ins 2.35(4)(b)(b) Use 1980 CSO or 1980 CET smoker and nonsmoker mortality tables to determine the valuation net premiums and additional minimum reserves, if any, required by s. 623.06 (7), Stats., and use composite mortality tables to determine the basic minimum reserves, minimum cash surrender values and amounts of paid-up nonforfeiture benefits; or Ins 2.35(4)(c)(c) Use 1980 CSO or 1980 CET smoker and nonsmoker mortality tables to determine minimum reserve liabilities and minimum cash surrender values and amounts of paid-up nonforfeiture benefits. Ins 2.35 HistoryHistory: Cr. Register, November, 1988, No. 395, eff. 12-1-88. Ins 2.40Ins 2.40 Annuity contracts without life contingencies. Ins 2.40(1)(1) Purpose. This section implements and interprets s. 632.66, Stats., by authorizing life insurers to issue annuity contracts without life contingencies and setting forth the conditions under which these annuity contracts may be issued. Ins 2.40(2)(2) Scope. This section applies to all annuity contracts without life contingencies and which are classified as life and disability insurance under s. Ins 6.75 (1). Ins 2.40(3)(3) Grant of authority. A life insurer that holds a valid certificate of authority to transact the business of life insurance and annuities in this state may issue in this state annuity contracts without life contingencies, subject to the following conditions: Ins 2.40(3)(a)(a) No insurer may base the consideration to be paid to the insurer for the annuity contract without a life contingency upon the age or condition of health of the purchaser of the contract or any other person, or on any mortality or morbidity contingencies. Ins 2.40(3)(b)(b) An insurer shall base the amounts guaranteed to be paid under an annuity contract without a life contingency upon reasonable assumptions as to investment income and expenses, determined in a manner which is equitable to all holders of such contracts. Ins 2.40(3)(c)(c) An insurer may offer to the public an annuity contract without a life contingency only through licensed intermediaries or directly by the insurer. Ins 2.40(4)(4) Applicable statutes and administrative rules. An annuity contract without a life contingency is deemed to be an annuity for purposes of chs. 600 to 645, Stats., and all rules adopted thereunder, including, but not limited to, ch. 623, Stats., ss. 631.20 to 631.27, Stats., and ss. Ins 2.07, 2.15, 6.05, and 51.80. Ins 2.40 HistoryHistory: Cr. Register, December, 1988, No. 396, eff. 1-1-89; correction in (4) made under s. 13.93 (2m) (b) 7., Stats., Register, June, 1999, No. 522. Ins 2.45Ins 2.45 Charitable organizations; insurable interest. Ins 2.45(1)(1) Purpose. The purpose of this section is to interpret s. 631.07, Stats., with respect to the insurable interest of charitable organizations. This section does not limit or abridge any insurable interest existing at common law or by statute. Ins 2.45(2)(2) Scope. This section applies to life insurance policies issued in this state, including, but not limited to, policies in force on March 1, 1994. Ins 2.45(3)(b)(b) “Life insurance” includes endowment policies and annuities. Ins 2.45(4)(4) Insurable interest. A charitable organization may be the applicant, owner or beneficiary of a life insurance policy issued on the life of any individual. A charitable organization is deemed to have an insurable interest in the individual. For insurance applied for on or after March 1, 1994, the charitable organization has an insurable interest only if it obtains the consent of the individual in writing or by other means authorized by common law or by statute. Ins 2.45 HistoryHistory: Cr. Register, February, 1994, No. 458, eff. 3-1-94. Ins 2.80Ins 2.80 Valuation of life insurance policies. Ins 2.80(1)(a)(a) This section establishes minimum standards under ch. 623, Stats., for life insurance policy reserves by providing tables of select mortality factors, establishing rules concerning a minimum standard for the valuation of plans with non-level premiums or benefits, and establishing rules concerning a minimum standard for the valuation of plans with secondary guarantees. Ins 2.80(1)(b)(b) The method for calculating basic reserves defined in this section constitutes the commissioner’s reserve valuation method for policies to which this section is applicable. Ins 2.80(2)(2) Scope. This section applies to all life insurance policies, wherever sold, with or without nonforfeiture values, issued on or after January 1, 2000, subject to the following exceptions and conditions: Ins 2.80(2)(a)(a) This section does not apply to any individual life insurance policy issued on or after January 1, 2000, if the policy is issued in accordance with and as a result of the exercise of a reentry provision contained in the original life insurance policy of the same or greater face amount that was issued before January 1, 2000 that guarantees the premium rates of the new policy. This section also does not apply to subsequent policies issued as a result of the exercise of such a provision in the new policy. Ins 2.80(2)(b)(b) This section does not apply to any of the following: Ins 2.80(2)(b)1.1. Any universal life policy that meets all the following requirements: Ins 2.80(2)(b)1.b.b. The specified premium for the secondary guarantee period is not less than the net level reserve premium for the secondary guarantee period based on the CSO valuation tables as defined in sub. (3) (f) and the applicable valuation interest rate. Ins 2.80(2)(b)1.c.c. The initial surrender charge is not less than 100% of the first year annualized specified premium for the secondary guarantee period. Ins 2.80(2)(b)2.2. Any variable life insurance policy that provides for life insurance, the amount or duration of which varies according to the investment experience of any separate account or accounts. Ins 2.80(2)(b)3.3. Any variable universal life insurance policy that provides for life insurance, the amount or duration of which varies according to the investment experience of any separate account or accounts. Ins 2.80(2)(b)4.4. Group life insurance certificates, unless the certificates provide for a stated or implied schedule of maximum gross premiums required in order to continue coverage in force for a period in excess of one year. Ins 2.80(2)(c)(c) Calculation of the minimum valuation standard for policies with guaranteed nonlevel gross premiums or guaranteed nonlevel benefits, other than universal life policies, or both, shall be in accordance with the provisions of sub. (5). Ins 2.80(2)(d)(d) Calculation of the minimum valuation standard for flexible premium and fixed premium universal life insurance policies, that contain provisions resulting in the ability of a policyholder to keep a policy in force over a secondary guarantee period shall be in accordance with the provisions of sub. (6).
