Weekly Tip: Mix and Match


Weekly Tips

Mix and Match


An important benefit of making product filings with the Insurance Compact is the ability to "mix and match" product components filed with the Compact with state-approved product components. Section 111(b) of the Operating Procedure for the Filing and Approval of Product Filings for the Insurance Compact (Product Filing Rule) permits the use of state-approved product components with Compact-approved product components unless stated otherwise in the Scope of the applicable Uniform Standards. Mix and match is available for the majority of the life and annuity products (an example of where mix and match is not permissible would be the CSO mortality tables). Mix and match is not allowed for long-term care (LTC) insurance products, but Compact LTC riders may be used with state-approved life and annuity products. The process is also not allowed for Disability Income (DI) products other than to mix and match a DI application with state-approved DI forms.

If you are thinking of using the mix and match option for your Compact product, there are some basic rules to follow. An Officer must certify that the combination of components does not contain inconsistent, ambiguous, unfair, inequitable or misleading clauses, or exceptions or conditions that unreasonably affect the risk purported to be assumed must be included in the filing. There is a template that is available for use on the Insurance Compact website. Information about the state-approved forms that will be used with the Compact forms should be provided in the filing submission. The Statement of Intent Schedule in the Compact SERFF instance has been developed to facilitate this process. Use the SERFF Filing Wizard template feature to help complete mix and match filing information, save it in your back office and reuse.

Keep in mind that the mix and match framework has two primary purposes: 1) filing a form with the state or using a form approved by a state to mix and match with Compact filed/approved forms when there is no Uniform Standard for the state-filed form; and 2) filing a form with the Compact and using with state-approved forms due to product development needs, cycle, and rollouts. The use of riders providing stand-alone benefits are good examples of the intended purpose of mix and match; i.e. accidental death, waiver of premium, and guaranteed insurability riders. Compacting States may follow up with a filer if the information in the filer's Statement of Intent Schedule is incomplete or does not match the Compacting States' information. Some Compacting States are not allowing companies to file part of the product / product features / provisions with the state to be combined or used with a product filing previously approved by the Compact (commonly referred to as "reverse mix and match") when the filer could be filing all components of the product with the Compact under the Uniform Standards.

In addition, the following valuable tips are important to keep in mind when using the mix and match framework:

  • IIPRC forms cannot alter, change or affect values or nonforfeiture requirements in state-approved forms.
  • Mix and match cannot be used to fully comply with Uniform Standard (e.g. IIPRC form standing alone has to comply fully with the applicable Uniform Standard).
  • Mix and match cannot be used to bypass provisions within a Uniform Standard (e.g. filing a form with a Compacting State(s) for use only with a Compact-approved form even though the Compact has Uniform Standards applicable to the state-filed form).
  • Application parts may not be mixed and matched. If filing an application with the Compact, the Application Uniform Standards require that a filing include all sections and questions required to be completed by an applicant, including additional drop downs, scripts, questions, questionnaires or supplements.
  • Indexed-linked riders cannot be used with Compact approved contracts via mix and match and vice versa unless the index rider is adding an additional index option to an underlying contract which is already an indexed product.

Please be sure to review Filing Information Notice (FIN) 2009-4 on the Compact website and in the SERFF General Instructions before preparing your filing. It is also a good idea to take advantage of the on demand tutorial called "How to Complete a Statement of Intent", which is located on the insurance company resources page of the Compact website.

Are you using the template and copy and paste tools to minimize the amount and time spent on data entry for the SOI Schedule? The Compact worked with the SERFF Team to introduce additional enhancements for completing the Statement of Intent Schedule and making it easier to do so. Users now have the ability to populate and upload a pre-formatted Microsoft Excel spreadsheet directly into the SOI Schedule - this information can be found in SERFF Online Help and will soon be available in the IIPRC's General Instructions.

If you have any questions about any of the information that is in this email or questions in preparing a mix-and-match filing, please contact the IIPRC Office for additional information and assistance.