California Code of Regulations
Title 10 - Investment
Chapter 5 - Insurance Commissioner
Subchapter 3 - Insurers
Article 12.4 - Valuation of Universal Life Insurance Policies
Section 2544.4 - Alternate Minimum Reserves
Current through Register 2024 Notice Reg. No. 38, September 20, 2024
If, in any policy year, the Guaranteed Maturity Premium on any universal life insurance policy is less than the valuation net premium for such policy, calculated by the valuation method actually used in calculating the reserve thereon but using the minimum valuation standards of mortality and rate of interest, the minimum reserve required for such contract shall be the greater of subparts (1) or (2) of this section:
(1) The reserve calculated according to the method, the mortality table, and the rate of interest actually used; or,
(2) The reserve calculated according to the method actually used, but using the minimum valuation standards of mortality and rate of interest and replacing the valuation net premium by the Guaranteed Maturity Premium in each policy year for which the valuation net premium exceeds the Guaranteed Maturity Premium.
For universal life reserves on a net level premium basis, the valuation net premium shall be PVFB/ax and for reserves on a Commissioners Reserve Valuation Method, the valuation net premium shall be (PVFB/äx) + ([(a)-(b)]/äx).
1. New section
filed 10-17-91; operative 11-18-91 (Register 92, No. 3).
2. Amendment of
NOTE filed 3-22-2016; operative 7-1-2016 (Register 2016, No.
13).
Note: Authority cited: Sections 720, 790.10, 10489.93, 12921 and 12926, Insurance Code. Reference: Section 10489.93, Insurance Code.
