Weekly Tip: Variability in Individual Annuity Products

 

Weekly Tips

Variability in Individual Annuity Products

10/01/2012

There is a full suite of Uniform Standards in which to file individual annuity products through the Interstate Compact. The Uniform Standards have specific requirements concerning variability in annuity forms as found in the Variability of Information section under the Additional Submission Requirements. It is noteworthy to point out the following:

  1. Variability in contract forms is permitted only on the specifications page(s) except for some limited, specified pieces of information. This may require companies to restructure products so that all variability is contained on the specifications page(s).
  1. As with contract forms, variability in rider forms can only appear on specifications pages. The required rider specification information can be included on a rider specification page part of the rider itself, or in the alternative, the rider specifications information can be contained in the contract form specification page(s). If a specifications page is to be part of the rider form itself, it is not necessary that it be a separate page - the specifications can be part of the first page of the rider; with the specification section appropriately labeled as such.
  1. Guaranteed annuity purchase rates are not allowed to be variable - no matter where they appear in the contract form.
  1. Fraud notice on applications is not allowed to be variable. The Uniform Standards are clear on the language for the notice that is required.
  1. Variability requires an accompanying statement of variability.
  1. Values denoted as variable need reasonable and realistic ranges set forth in the statement of variability. Please note that it is not permissible to include a zero "0" in the range for any credit or benefit, i.e. bonus feature.
  1. There is a specific Certification of Variability required if the filing contains a Statement of Variability.
  1. Please make sure to denote company addresses and phone numbers as variable and include the appropriate explanation in the statement of variability. This will help to avoid a filing for approval if this information should change in the future.

If you have any questions about any of the information that is in this email, please contact the IIPRC Office for additional information and assistance.