National Service Life Insurance Premium Payment and Loan Amendment, 56846-56848 [2021-22208]

Download as PDF 56846 Federal Register / Vol. 86, No. 195 / Wednesday, October 13, 2021 / Proposed Rules ‘‘lat. 35°39′31″ N, long. 117°49′46″ W’’, to match the FAA database. Class E5 airspace designations are published in paragraph 6005 of FAA Order JO 7400.11F, dated August 10, 2021, and effective September 15, 2021, which is incorporated by reference in 14 CFR 71.1. The Class E airspace designations listed in this document will be published subsequently in the Order. FAA Order JO 7400.11, Airspace Designations and Reporting Points, is published yearly and effective on September 15. Regulatory Notices and Analyses The FAA has determined that this regulation only involves an established body of technical regulations for which frequent and routine amendments are necessary to keep them operationally current, is non-controversial, and unlikely to result in adverse or negative comments. It, therefore: (1) Is not a ‘‘significant regulatory action’’ under Executive Order 12866; (2) is not a ‘‘significant rule’’ under DOT Regulatory Policies and Procedures (44 FR 11034; February 26, 1979); and (3) does not warrant preparation of a regulatory evaluation as the anticipated impact is so minimal. Since this is a routine matter that will only affect air traffic procedures and air navigation, it is certified that this rule, when promulgated, would not have a significant economic impact on a substantial number of small entities under the criteria of the Regulatory Flexibility Act. Environmental Review This proposal will be subject to an environmental analysis in accordance with FAA Order 1050.1F, ‘‘Environmental Impacts: Policies and Procedures’’ prior to any FAA final regulatory action. List of Subjects in 14 CFR Part 71 Airspace, Incorporation by reference, Navigation (air). jspears on DSK121TN23PROD with PROPOSALS1 The Proposed Amendment Accordingly, pursuant to the authority delegated to me, the Federal Aviation Administration proposes to amend 14 CFR part 71 as follows: PART 71—DESIGNATION OF CLASS A, B, C, D, AND E AIRSPACE AREAS; AIR TRAFFIC SERVICE ROUTES; AND REPORTING POINTS 1. The authority citation for 14 CFR part 71 continues to read as follows: ■ Authority: 49 U.S.C. 106(f), 106(g), 40103, 40113, 40120; E.O. 10854, 24 FR 9565, 3 CFR, 1959–1963 Comp., p. 389. VerDate Sep<11>2014 16:28 Oct 12, 2021 Jkt 256001 § 71.1 [Amended] 2. The incorporation by reference in 14 CFR 71.1 of FAA Order JO 7400.11F, Airspace Designations and Reporting Points, dated August 10, 2021, and effective September 15, 2021, is amended as follows: ■ Paragraph 6005 Class E Airspace Areas Extending Upward From 700 Feet or More Above the Surface of the Earth. * * * * * AWP CA E5 Inyokern, CA [Amended] Inyokern Airport, CA (Lat. 35°39′31″ N, long. 117°49′46″ W) That airspace extending upward from 700 feet above the surface within a 4-mile radius of the airport, and within 2.7 miles each side of the 215° bearing from the airport extending from the 4-mile radius to 11.6 miles southwest of Inyokern Airport, excluding that airspace within Restricted Area R–2505 and R–2506. Issued in Des Moines, Washington, on October 6, 2021. B.G. Chew, Acting Group Manager, Operations Support Group, Western Service Center. [FR Doc. 2021–22193 Filed 10–12–21; 8:45 am] BILLING CODE 4910–13–P DEPARTMENT OF VETERANS AFFAIRS 38 CFR Part 8 RIN 2900–AR29 National Service Life Insurance Premium Payment and Loan Amendment Department of Veterans Affairs. Proposed rule. AGENCY: ACTION: The Department of Veterans Affairs (VA) proposes to amend its National Service Life Insurance regulations to offer Service-Disabled Veterans’ Insurance policyholders the option of remitting premiums for government life insurance coverage only on a monthly or annual basis. VA also proposes to increase the amount that Veteran policyholders are eligible to borrow against the value of their life insurance policies and to adjust the interest rates charged for fixed-rate loans in certain circumstances. DATES: Comments must be received on or before December 13, 2021. ADDRESSES: Comments may be submitted through www.Regulations.gov. Comments should indicate that they are submitted in response to ‘‘RIN 2900–AR29— National Service Life Insurance Premium Payment and Loan SUMMARY: PO 00000 Frm 00007 Fmt 4702 Sfmt 4702 Amendment.’’ Comments received will be available at regulations.gov for public viewing, inspection or copies. FOR FURTHER INFORMATION CONTACT: Paul Weaver, Insurance Specialist, Department of Veterans Affairs Insurance Service (310/290B), 5000 Wissahickon Avenue, Philadelphia, PA 19144, (215) 842–2000, ext. 4263. (This is not a toll-free number.) SUPPLEMENTARY INFORMATION: Under the authority of 38 U.S.C. 1901–1929, VA currently administers four distinct life insurance programs: National Service Life Insurance (NSLI), Veterans’ Special Life Insurance (VSLI), Veterans’ Reopened Insurance (VRI), and ServiceDisabled Veterans’ Insurance (S–DVI). As of January 31, 2021, these life insurance programs are providing insurance coverage under 458,424 policies owned by Veterans. 1. Payment of Premiums for Programs Issuing New Policies Section 1908 of title 38, U.S.C., requires VA to ‘‘prescribe the time and method of payment of the premiums on insurance’’ for those programs by issuing regulations. VA has implemented this authority in 38 CFR 8.2(c). Section 8.2(c) requires Veteran policyholders to pay premiums on a monthly basis, with the option of paying premiums on a quarterly, semi-annual, or annual basis if the premiums are paid in advance. NSLI, VSLI, and VRI are closed to new issues, and VA does not propose to modify any premium paying requirements pertaining to these life insurance programs. However, S–DVI remains open to new issues and is currently providing coverage to Veterans with service-connected disabilities. More than 275,000 Veteran policyholders are insured under S–DVI, and less than 3,000 pay premiums on a quarterly or semi-annual basis. Because very few S–DVI policyholders are paying premiums on a quarterly or semi-annual basis and these payment options add administrative complexity and program costs associated with calculating premiums due for policyholders who elect these payment options, VA proposes to eliminate these two payment options for policyholders receiving future issue of S–DVI. Moreover, research shows that lapsed rates tend to increase with the number of premium payments made each year, with the notable exception of monthly payment modes. See, e.g., Cathy Ho & Nancy Muise, U.S. Individual Life Persistency: Guaranteed & Simplified Issue—A Joint Study Sponsored by Soc’y of Actuaries & LIMRA 16 (2013), https://www.soa.org/globalassets/assets/ E:\FR\FM\13OCP1.SGM 13OCP1 Federal Register / Vol. 86, No. 195 / Wednesday, October 13, 2021 / Proposed Rules jspears on DSK121TN23PROD with PROPOSALS1 Files/Research/Exp-Study/research2013-gisi-study.pdf (last visited Aug. 5, 2021). Thus, we propose to amend § 8.2(c) to require policyholders receiving future issue of S–DVI to submit premiums on the policy monthly due date or in advance on an annual basis. Veterans who were previously insured under S–DVI will retain the option of paying premiums on a monthly basis or in advance on a quarterly, semi-annual, or annual basis. The proposed amendment is consistent with 38 CFR 8.4, which allows Veteran policyholders to pay premiums by a monthly deduction from disability compensation or certain other payments due from VA. The proposed rule would also apply to Veteran policyholders who become insured under 38 U.S.C. 1922B(a)(1). (On January 1, 2023, VA will begin issuing policies under a new service-disabled Veterans’ insurance program, authorized by section 2004(a)(1) of the Johnny Isakson and David P. Roe, M.D. Veterans Health Care and Benefits Improvement Act of 2020, Pub. L. 116–315, and codified at 38 U.S.C. 1922B.) In addition, we would add a paragraph in § 8.2(c) to make clear that NSLI, VSLI, and VRI policyholders, as well as current S–DVI policyholders, may continue to pay premiums on a monthly basis or in advance on an annual, semi-annual, or quarterly basis. 2. Adjust Policy Loan Amounts and Interest Rates Section 1906 of title 38, U.S.C., provides VA discretion to provide reasonable and practicable provisions pertaining to cash and loan values by publishing regulations. In 38 CFR 8.13(a), VA states that ‘‘the United States will lend to the insured . . . any amount which will not exceed 94 percent of the [policy’s] reserve.’’ Standard insurance industry practice allows policyholders access to the full cash value of their policies. To align with standard insurance industry practice, VA proposes to provide Veteran policyholders with access to the full cash value that policies accrue over the time period in which Veteran policyholders pay premiums for life insurance coverage. Thus, VA proposes to remove from § 8.13(a) the 94 percent limit on the amount that Veteran policyholders may borrow. In addition, managing multiple loans for a single policyholder is administratively complex and costly. Furthermore, it would be cost prohibitive to modify current technology to support multiple loans for one policyholder. Thus, VA proposes to amend § 8.13(d) to require Veteran policyholders with existing fixed-rate VerDate Sep<11>2014 16:28 Oct 12, 2021 Jkt 256001 loans who want to apply for additional loans on their policies to refinance these existing fixed-rate loans into new variable-rate loans subject to a new loan rate equal to variable loan rates available from VA at the time of the loan application. This practice is acceptable within the insurance industry and would allow VA to offer loans against the remaining available cash value of Veterans’ life insurance coverage, and reduce administrative complexity and costs associated with managing multiple loans for a single policyholder. Executive Orders 12866 and 13563 Executive Orders 12866 and 13563 direct agencies to assess the costs and benefits of available regulatory alternatives and, when regulation is necessary, to select regulatory approaches that maximize net benefits (including potential economic, environmental, public health and safety effects, and other advantages; distributive impacts; and equity). Executive Order 13563 (Improving Regulation and Regulatory Review) emphasizes the importance of quantifying both costs and benefits, reducing costs, harmonizing rules, and promoting flexibility. The Office of Information and Regulatory Affairs has determined that this rule is not a significant regulatory action under Executive Order 12866. The Regulatory Impact Analysis associated with this rulemaking can be found as a supporting document at www.regulations.gov. Regulatory Flexibility Act The Secretary hereby certifies that this proposed rule would not have a significant economic impact on a substantial number of small entities as they are defined in the Regulatory Flexibility Act, 5 U.S.C. 601–612. This proposed rule would directly affect only individuals and would not directly affect any small entities. Therefore, pursuant to 5 U.S.C. 605(b), the initial and final regulatory flexibility analysis requirements of 5 U.S.C. 603 and 604 do not apply. Unfunded Mandates PO 00000 Frm 00008 Fmt 4702 tribal governments, or on the private sector. Paperwork Reduction Act This proposed rule contains no provisions constituting a collection of information under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501– 3521). Catalog of Federal Domestic Assistance The Catalog of Federal Domestic Assistance numbers and titles for the programs affected by this document are 64.030, Life Insurance for Veterans— Face Amount of New Life Insurance Policies Issued, and 64.031-Life Insurance for Veterans—Direct Payments for Insurance. List of Subjects in 38 CFR Part 8 Disability benefits, Life insurance, Loan programs—veterans, Military personnel, Veterans. Signing Authority Denis McDonough, Secretary of Veterans Affairs, approved this document on September 14, 2021, and authorized the undersigned to sign and submit the document to the Office of the Federal Register for publication electronically as an official document of the Department of Veterans Affairs. Jeffrey M. Martin, Assistant Director, Office of Regulation Policy & Management, Office of the Secretary, Department of Veterans Affairs. For the reasons stated in the preamble, the Department of Veterans Affairs proposes to amend 38 CFR part 8 as set forth below: PART 8—NATIONAL SERVICE LIFE INSURANCE 1. The authority citation for part 8 continues to read as follows: ■ Authority: 38 U.S.C. 501, 1901–1929, 1981–1988. 2. Amend § 8.2 by revising paragraph (c)(2) and adding paragraph (c)(3) to read as follows: ■ § 8.2 Payment of premiums. * The Unfunded Mandates Reform Act of 1995 requires, at 2 U.S.C. 1532, that agencies prepare an assessment of anticipated costs and benefits before issuing any rule that may result in the expenditure by State, local, and tribal governments, in the aggregate, or by the private sector, of $100 million or more (adjusted annually for inflation) in any one year. This proposed rule would have no such effect on State, local, and Sfmt 4702 56847 * * * * (c) * * * * * * * * (2) Policyholders may pay premiums in advance on an annual basis. (3) Policyholders insured as of [EFFECTIVE DATE OF THE FINAL RULE] may pay premiums in advance on an annual, semi-annual, or quarterly basis. * * * * * ■ 3. Amend § 8.13: E:\FR\FM\13OCP1.SGM 13OCP1 56848 Federal Register / Vol. 86, No. 195 / Wednesday, October 13, 2021 / Proposed Rules a. In paragraph (a), by removing ‘‘which will not exceed 94 percent’’ and adding ‘‘policy’’ before ‘‘reserve’’ in the first sentence; and ■ b. By revising paragraph (d). The revision reads as follows: ■ § 8.13 Policy loans. * * * * * (d) Notwithstanding any other provisions of this section, the variable loan rate shall not exceed 12 percent or be lower than 5 percent per annum. For policyholders with an existing fixed-rate loan who subsequently apply for an additional loan on the same policy, the existing fixed-rate loan shall be refinanced into the new variable-rate loan at the prevailing variable rate at the time of the new loan application. [FR Doc. 2021–22208 Filed 10–12–21; 8:45 am] BILLING CODE 8320–01–P ENVIRONMENTAL PROTECTION AGENCY 40 CFR Part 52 [EPA–R09–OAR–2021–0549; FRL–8856–01– R9] Second 10-Year Maintenance Plan for the Indian Wells Valley PM10 Planning Area; California Environmental Protection Agency (EPA). ACTION: Proposed rule. AGENCY: jspears on DSK121TN23PROD with PROPOSALS1 FOR FURTHER INFORMATION CONTACT: The Environmental Protection Agency (EPA) is proposing to approve the ‘‘Indian Wells Valley Second 10Year PM10 Maintenance Plan’’ (‘‘Indian Wells Second Maintenance Plan’’ or ‘‘Plan’’) as a revision to the state implementation plan (SIP) for the State of California. The Indian Wells Second Maintenance Plan includes, among other elements, a base year emissions inventory, a maintenance demonstration, contingency provisions, and motor vehicle emissions budgets for use in transportation conformity determinations. The EPA is proposing these actions because the SIP revision meets the applicable statutory and regulatory requirements for such plans and motor vehicle emissions budgets. Lastly, the EPA is beginning the adequacy process for the 2020 and 2025 motor vehicle emissions budgets in the Plan through this proposed rule. DATES: Comments must be received on or before November 12, 2021. ADDRESSES: Submit your comments, identified by Docket ID No. EPA–R09– OAR–2021–0549, at https:// www.regulations.gov. For comments SUMMARY: VerDate Sep<11>2014 16:28 Oct 12, 2021 Jkt 256001 submitted at Regulations.gov, follow the online instructions for submitting comments. Once submitted, comments cannot be edited or removed from Regulations.gov. The EPA may publish any comment received to its public docket. Do not submit electronically any information you consider to be Confidential Business Information (CBI) or other information whose disclosure is restricted by statute. Multimedia submissions (audio, video, etc.) must be accompanied by a written comment. The written comment is considered the official comment and should include discussion of all points you wish to make. The EPA will generally not consider comments or comment contents located outside of the primary submission (i.e., on the web, cloud, or other file sharing system). For additional submission methods, please contact the person identified in the FOR FURTHER INFORMATION CONTACT section. For the full EPA public comment policy, information about CBI or multimedia submissions, and general guidance on making effective comments, please visit https://www.epa.gov/dockets/ commenting-epa-dockets. If you need assistance in a language other than English or if you are a person with disabilities who needs a reasonable accommodation at no cost to you, please contact the person identified in the FOR FURTHER INFORMATION CONTACT section. Ashley Graham, EPA Region IX, 75 Hawthorne St., San Francisco, CA 94105. By phone: (415) 972–3877 or by email at graham.ashleyr@epa.gov. SUPPLEMENTARY INFORMATION: Throughout this document, ‘‘we,’’ ‘‘us,’’ and ‘‘our’’ refer to the EPA. Table of Contents I. Background A. The PM10 National Ambient Air Quality Standards B. The Indian Wells Valley PM10 Planning Area II. Procedural Requirements for Adoption and Submittal of State Implementation Plan Revisions III. Requirements for Second 10-Year Maintenance Plans IV. Evaluation of the Indian Wells Second Maintenance Plan A. Emissions Inventories B. Maintenance Demonstration C. Verification of Continued Attainment D. Contingency Provisions E. Motor Vehicle Emissions Budgets for Transportation Conformity V. Proposed Action and Request for Public Comment VI. Statutory and Executive Order Reviews PO 00000 Frm 00009 Fmt 4702 Sfmt 4702 I. Background A. The PM10 National Ambient Air Quality Standards Under section 109 of the Clean Air Act (CAA or ‘‘Act’’), the EPA established national ambient air quality standards (NAAQS or ‘‘standards’’) for certain pervasive air pollutants (referred to as ‘‘criteria pollutants’’) and conducts periodic reviews of the NAAQS to determine whether they should be revised or whether new NAAQS should be established. The EPA sets the NAAQS for criteria pollutants at levels required to protect public health and welfare.1 Particulate matter is one of the ambient pollutants for which the EPA has established NAAQS.2 In 1987, the EPA established primary and secondary NAAQS for particles with an aerodynamic diameter less than or equal to a nominal 10 microns in diameter (PM10).3 At that time, the EPA established two PM10 standards; an annual standard and a 24-hour standard.4 The annual PM10 standard was subsequently revoked.5 More recently, the EPA announced that it was retaining the 24-hour PM10 NAAQS as a 24-hour standard of 150 micrograms per cubic meter (mg/m3).6 In this document, ‘‘PM10 NAAQS’’ or ‘‘PM10 standard’’ refer to the 24-hour PM10 NAAQS. An area attains the 24-hour standard of 150 mg/m3 when the expected number of days per calendar year with a 24-hour 1 For a given air pollutant, ‘‘primary’’ standards are those determined by the EPA as requisite to protect the public health. ‘‘Secondary’’ standards are those determined by the EPA as requisite to protect the public welfare from any known or anticipated adverse effects associated with the presence of such air pollutant in the ambient air. CAA section 109(b). 2 Particulate matter is the generic term for a broad class of chemically and physically diverse substances that exist as discrete particles (liquid droplets or solids) over a wide range of sizes. Particles originate from a variety of anthropogenic stationary and mobile sources as well as from natural sources. Particles may be emitted directly or form in the atmosphere by transformations of gaseous emissions such as sulfur dioxide (SO2), oxides of nitrogen (NOX), volatile organic compounds (VOC), and ammonia (NH3). The chemical and physical properties of particulate matter vary greatly with time, region, meteorology, and source category. SO2, NOX, VOC, and NH3 are referred to as PM10 precursors. As discussed later in this proposed rule, precursors do not contribute significantly to elevated ambient PM10 concentrations in the Indian Wells Valley planning area. Some California air quality plans use the term reactive organic gases (ROG) instead of VOC. The terms cover essentially the same compounds, and herein we use the term VOC. 3 52 FR 24634 (July 1, 1987). 4 The primary and secondary standards were set at the same level for both the 24-hour and the annual PM10 standards. 5 In 2006, the EPA retained the 24-hour PM 10 standards but revoked the annual standards. 71 FR 61144 (October 17, 2006). 6 78 FR 3086 (January 15, 2013). E:\FR\FM\13OCP1.SGM 13OCP1

Agencies

[Federal Register Volume 86, Number 195 (Wednesday, October 13, 2021)]
[Proposed Rules]
[Pages 56846-56848]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2021-22208]


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DEPARTMENT OF VETERANS AFFAIRS

38 CFR Part 8

RIN 2900-AR29


National Service Life Insurance Premium Payment and Loan 
Amendment

AGENCY: Department of Veterans Affairs.

ACTION: Proposed rule.

-----------------------------------------------------------------------

SUMMARY: The Department of Veterans Affairs (VA) proposes to amend its 
National Service Life Insurance regulations to offer Service-Disabled 
Veterans' Insurance policyholders the option of remitting premiums for 
government life insurance coverage only on a monthly or annual basis. 
VA also proposes to increase the amount that Veteran policyholders are 
eligible to borrow against the value of their life insurance policies 
and to adjust the interest rates charged for fixed-rate loans in 
certain circumstances.

DATES: Comments must be received on or before December 13, 2021.

ADDRESSES: Comments may be submitted through www.Regulations.gov. 
Comments should indicate that they are submitted in response to ``RIN 
2900-AR29--National Service Life Insurance Premium Payment and Loan 
Amendment.'' Comments received will be available at regulations.gov for 
public viewing, inspection or copies.

FOR FURTHER INFORMATION CONTACT: Paul Weaver, Insurance Specialist, 
Department of Veterans Affairs Insurance Service (310/290B), 5000 
Wissahickon Avenue, Philadelphia, PA 19144, (215) 842-2000, ext. 4263. 
(This is not a toll-free number.)

SUPPLEMENTARY INFORMATION: Under the authority of 38 U.S.C. 1901-1929, 
VA currently administers four distinct life insurance programs: 
National Service Life Insurance (NSLI), Veterans' Special Life 
Insurance (VSLI), Veterans' Reopened Insurance (VRI), and Service-
Disabled Veterans' Insurance (S-DVI). As of January 31, 2021, these 
life insurance programs are providing insurance coverage under 458,424 
policies owned by Veterans.

1. Payment of Premiums for Programs Issuing New Policies

    Section 1908 of title 38, U.S.C., requires VA to ``prescribe the 
time and method of payment of the premiums on insurance'' for those 
programs by issuing regulations. VA has implemented this authority in 
38 CFR 8.2(c). Section 8.2(c) requires Veteran policyholders to pay 
premiums on a monthly basis, with the option of paying premiums on a 
quarterly, semi-annual, or annual basis if the premiums are paid in 
advance. NSLI, VSLI, and VRI are closed to new issues, and VA does not 
propose to modify any premium paying requirements pertaining to these 
life insurance programs. However, S-DVI remains open to new issues and 
is currently providing coverage to Veterans with service-connected 
disabilities. More than 275,000 Veteran policyholders are insured under 
S-DVI, and less than 3,000 pay premiums on a quarterly or semi-annual 
basis. Because very few S-DVI policyholders are paying premiums on a 
quarterly or semi-annual basis and these payment options add 
administrative complexity and program costs associated with calculating 
premiums due for policyholders who elect these payment options, VA 
proposes to eliminate these two payment options for policyholders 
receiving future issue of S-DVI. Moreover, research shows that lapsed 
rates tend to increase with the number of premium payments made each 
year, with the notable exception of monthly payment modes. See, e.g., 
Cathy Ho & Nancy Muise, U.S. Individual Life Persistency: Guaranteed & 
Simplified Issue--A Joint Study Sponsored by Soc'y of Actuaries & LIMRA 
16 (2013), https://www.soa.org/globalassets/assets/

[[Page 56847]]

Files/Research/Exp-Study/research-2013-gisi-study.pdf (last visited 
Aug. 5, 2021). Thus, we propose to amend Sec.  8.2(c) to require 
policyholders receiving future issue of S-DVI to submit premiums on the 
policy monthly due date or in advance on an annual basis. Veterans who 
were previously insured under S-DVI will retain the option of paying 
premiums on a monthly basis or in advance on a quarterly, semi-annual, 
or annual basis. The proposed amendment is consistent with 38 CFR 8.4, 
which allows Veteran policyholders to pay premiums by a monthly 
deduction from disability compensation or certain other payments due 
from VA. The proposed rule would also apply to Veteran policyholders 
who become insured under 38 U.S.C. 1922B(a)(1). (On January 1, 2023, VA 
will begin issuing policies under a new service-disabled Veterans' 
insurance program, authorized by section 2004(a)(1) of the Johnny 
Isakson and David P. Roe, M.D. Veterans Health Care and Benefits 
Improvement Act of 2020, Pub. L. 116-315, and codified at 38 U.S.C. 
1922B.) In addition, we would add a paragraph in Sec.  8.2(c) to make 
clear that NSLI, VSLI, and VRI policyholders, as well as current S-DVI 
policyholders, may continue to pay premiums on a monthly basis or in 
advance on an annual, semi-annual, or quarterly basis.

2. Adjust Policy Loan Amounts and Interest Rates

    Section 1906 of title 38, U.S.C., provides VA discretion to provide 
reasonable and practicable provisions pertaining to cash and loan 
values by publishing regulations. In 38 CFR 8.13(a), VA states that 
``the United States will lend to the insured . . . any amount which 
will not exceed 94 percent of the [policy's] reserve.'' Standard 
insurance industry practice allows policyholders access to the full 
cash value of their policies. To align with standard insurance industry 
practice, VA proposes to provide Veteran policyholders with access to 
the full cash value that policies accrue over the time period in which 
Veteran policyholders pay premiums for life insurance coverage. Thus, 
VA proposes to remove from Sec.  8.13(a) the 94 percent limit on the 
amount that Veteran policyholders may borrow.
    In addition, managing multiple loans for a single policyholder is 
administratively complex and costly. Furthermore, it would be cost 
prohibitive to modify current technology to support multiple loans for 
one policyholder. Thus, VA proposes to amend Sec.  8.13(d) to require 
Veteran policyholders with existing fixed-rate loans who want to apply 
for additional loans on their policies to refinance these existing 
fixed-rate loans into new variable-rate loans subject to a new loan 
rate equal to variable loan rates available from VA at the time of the 
loan application. This practice is acceptable within the insurance 
industry and would allow VA to offer loans against the remaining 
available cash value of Veterans' life insurance coverage, and reduce 
administrative complexity and costs associated with managing multiple 
loans for a single policyholder.

Executive Orders 12866 and 13563

    Executive Orders 12866 and 13563 direct agencies to assess the 
costs and benefits of available regulatory alternatives and, when 
regulation is necessary, to select regulatory approaches that maximize 
net benefits (including potential economic, environmental, public 
health and safety effects, and other advantages; distributive impacts; 
and equity). Executive Order 13563 (Improving Regulation and Regulatory 
Review) emphasizes the importance of quantifying both costs and 
benefits, reducing costs, harmonizing rules, and promoting flexibility. 
The Office of Information and Regulatory Affairs has determined that 
this rule is not a significant regulatory action under Executive Order 
12866. The Regulatory Impact Analysis associated with this rulemaking 
can be found as a supporting document at www.regulations.gov.

Regulatory Flexibility Act

    The Secretary hereby certifies that this proposed rule would not 
have a significant economic impact on a substantial number of small 
entities as they are defined in the Regulatory Flexibility Act, 5 
U.S.C. 601-612. This proposed rule would directly affect only 
individuals and would not directly affect any small entities. 
Therefore, pursuant to 5 U.S.C. 605(b), the initial and final 
regulatory flexibility analysis requirements of 5 U.S.C. 603 and 604 do 
not apply.

Unfunded Mandates

    The Unfunded Mandates Reform Act of 1995 requires, at 2 U.S.C. 
1532, that agencies prepare an assessment of anticipated costs and 
benefits before issuing any rule that may result in the expenditure by 
State, local, and tribal governments, in the aggregate, or by the 
private sector, of $100 million or more (adjusted annually for 
inflation) in any one year. This proposed rule would have no such 
effect on State, local, and tribal governments, or on the private 
sector.

Paperwork Reduction Act

    This proposed rule contains no provisions constituting a collection 
of information under the Paperwork Reduction Act of 1995 (44 U.S.C. 
3501-3521).

Catalog of Federal Domestic Assistance

    The Catalog of Federal Domestic Assistance numbers and titles for 
the programs affected by this document are 64.030, Life Insurance for 
Veterans--Face Amount of New Life Insurance Policies Issued, and 
64.031-Life Insurance for Veterans--Direct Payments for Insurance.

List of Subjects in 38 CFR Part 8

    Disability benefits, Life insurance, Loan programs--veterans, 
Military personnel, Veterans.

Signing Authority

    Denis McDonough, Secretary of Veterans Affairs, approved this 
document on September 14, 2021, and authorized the undersigned to sign 
and submit the document to the Office of the Federal Register for 
publication electronically as an official document of the Department of 
Veterans Affairs.

Jeffrey M. Martin,
Assistant Director, Office of Regulation Policy & Management, Office of 
the Secretary, Department of Veterans Affairs.

    For the reasons stated in the preamble, the Department of Veterans 
Affairs proposes to amend 38 CFR part 8 as set forth below:

PART 8--NATIONAL SERVICE LIFE INSURANCE

0
1. The authority citation for part 8 continues to read as follows:

    Authority:  38 U.S.C. 501, 1901-1929, 1981-1988.

0
2. Amend Sec.  8.2 by revising paragraph (c)(2) and adding paragraph 
(c)(3) to read as follows:


Sec.  8.2  Payment of premiums.

* * * * *
    (c) * * *
* * * * *
    (2) Policyholders may pay premiums in advance on an annual basis.
    (3) Policyholders insured as of [EFFECTIVE DATE OF THE FINAL RULE] 
may pay premiums in advance on an annual, semi-annual, or quarterly 
basis.
* * * * *
0
3. Amend Sec.  8.13:

[[Page 56848]]

0
a. In paragraph (a), by removing ``which will not exceed 94 percent'' 
and adding ``policy'' before ``reserve'' in the first sentence; and
0
b. By revising paragraph (d).
    The revision reads as follows:


Sec.  8.13  Policy loans.

* * * * *
    (d) Notwithstanding any other provisions of this section, the 
variable loan rate shall not exceed 12 percent or be lower than 5 
percent per annum. For policyholders with an existing fixed-rate loan 
who subsequently apply for an additional loan on the same policy, the 
existing fixed-rate loan shall be refinanced into the new variable-rate 
loan at the prevailing variable rate at the time of the new loan 
application.

[FR Doc. 2021-22208 Filed 10-12-21; 8:45 am]
BILLING CODE 8320-01-P
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