Alaska Administrative Code
Title 3 - Commerce, Community, and Economic Development
Part 2 - Division of Insurance
Chapter 21 - Insurer - Financial
Article 10 - Valuation of Life Insurance Policies
3 AAC 21.925 - Segment and contract segmentation method defined
Universal Citation: 3 AK Admin Code 21.925
Current through February 24, 2025
(a) For purposes of 3 AAC 21.900 - 3 AAC 21.949, the contract segmentation method
(1) is the method in which the amount of time
from issuance of a policy to the mandatory expiration of a policy is divided
into successive segments, with the length of each segment determined under (b)
of this section;
(2) makes all
calculations using
(A) for policies issued
before January 1, 2009, the 1980 CSO valuation tables or other valuation
mortality tables under
3
AAC 28.600 -
3
AAC 28.690;
(B) for policies issued on or after January
1, 2009, valuation mortality tables under
3
AAC 28.600 -
3
AAC 28.690, as required under
3
AAC 28.620(c); and
(3) if elected by the insurer,
uses the minimum mortality standard for deficiency reserves under
3
AAC 21.905(e) and (f).
(b) Subject to (c) of this section, the length of a segment is equal to the minimum value of t for which G t is greater than R t.
(c) If G t is never greater than R t, the length of the segment is the number of years from the beginning of the segment to the mandatory expiration of the policy.
(d) In this section,
(1)
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(A) if GP x+k+t is
greater than zero and GP x+k+t-1 is equal to zero, G
t is 1,000; or
(B) if GP x+k+t and
GP x+k+t-1 are equal to zero, G
t is zero;
(2) GP x+k+t-1 is
the guaranteed gross premium per $1,000 of face value for the year t of a
segment, not including policy fees if the policy fees are level for the entire
premium paying period of the policy;
(3) k is the number of years from the date
the policy was issued to the beginning of the segment;
(4) q x+k+t-1 is the
valuation mortality rate for deficiency reserves in policy year k+t using the
select mortality factors in
3
AAC 21.905(g) (2) if the insurer
elects to use the select mortality factors in
3
AAC 21.905(g) (3) to calculate
deficiency reserves;
(5)
(6) t is one in the first duration of the
segment, two in the second year of the segment, three in the third year of the
segment, and for each successive segment the whole number that corresponds to
the ordinal number of the year of the segment;
(7) x is original issue age.
Authority:AS 21.06.090
AS 21.18.110
AS 21.18.160
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