(1) The Contract Summary must be a separate
document. All information required to be disclosed must be set out in such a
manner as not to minimize or render any portion thereof obscure. Any amounts
which remain level for two or more contract years may be represented by a
single number if it is clearly indicated what amounts are applicable for each
contract year. Amounts in subparagraphs (2)(f), (g), (i) and (k)3 of this
section shall, in the Case of flexible premium annuity contracts, be determined
either according to an anticipated pattern of consideration payments or on the
assumption that considerations payable will be $100 a month or $1,000 per year.
If not specified in the contract, annuity payments shall be assumed to commence
at age sixty-five or ten years from issue, whichever is later. Zero amounts
shall be displayed as zero and shall not be displayed as blank
spaces.
(2) For purposes of this
regulation, "Contract Summary" means a written statement describing the
elements of the annuity contract and deposit fund, including but not limited
to, where applicable, the following:
(a) A
prominently placed title as follows: "Contract Summary" (This shall be followed
by an identification of the annuity contract or deposit fund, or both, to which
the summary applies);
(b) The name
and address of the insurance agent or, if no agent is involved, a statement of
the procedure to be followed in order to receive responses to inquiries
regarding the Contract Summary;
(c)
The full name and home office or administrative office address of the insurer
which will issue the annuity contract or administer the deposit fund;
(d) One of the options under the contract
available for annuity payout. This form of annuity payout should be used for
providing information in subparagraphs (2)(f), (g) and (i) of this
section;
(e) A prominent statement
that the contract does not provide cash surrender values if such is the
case;
(f) The amount of the
guaranteed annuity payments at the scheduled commencement of the annuity, based
on the assumption that all scheduled considerations are paid and there are no
prior withdrawals from or partial surrender of the contract and no indebtedness
to the insurer on the contract;
(g)
On the same basis as for subparagraph (2)(f) of this section except for
guarantees, illustrative annuity payments not greater in amount than those
based on
1. the current dividend scale and the
interest rate currently used to accumulate dividends under such contracts, or
the current excess interest rate credited by the insurer, and
2. current annuity purchase rates.
A dividend scale or excess interest rate which has been
publicly declared by the insurer with an effective date not more than two
months subsequent to the date of declaration shall be considered a current
dividend scale or current excess interest rate;
(h) For annuity contracts or deposit funds
for which guaranteed cash surrender values at any duration are less than the
total considerations paid, a prominent statement that such contract or fund may
result in loss if kept for only a few years, together with a reference to the
schedule of guaranteed cash surrender values required by subparagraph (2)(i)3.
of this section;
(i) The following
amounts, where applicable, for the first ten contract years and representative
contract years thereafter sufficient to clearly illustrate the patterns of
considerations and benefits, including but not limited to, the twentieth
contract year and at least one age from 60-70 and at the scheduled
commencements of annuity payments:
1. The
gross annual or single consideration for the annuity contract. Any additional
considerations for optional benefits, such as disability premium waiver, should
be shown separately;
2. Scheduled
annual or single deposit for the deposit fund, if any;
3. The total guaranteed death benefit and
cash surrender value at the end of the year; or, if no guaranteed cash
surrender values are provided, the total guaranteed paid-up annuity at the end
of the year. Values for a deposit fund must be shown separately from those for
a basic contract;
4. The total
illustrative death benefit and cash surrender value or paid-up annuity at the
end of the year, not greater in amount than that based on:
(i) the current dividend scale and the
interest rate currently used to accumulate dividends under such contracts or
the current excess interest rate credited by the insurer, and
(ii) current annuity purchase rates.
A dividend scale or excess interest rate which has been
publicly declared by the insurer with an effective date not more than two
months subsequent to the date of declaration shall be considered a current
dividend scale or current excess interest rate.
(j) For a Contract Summary which
includes values based on the current dividend scale or the current dividend
accumulation or excess interest rate, a statement that such values are
illustrations and are not guaranteed.
(k) The following should be shown with regard
to the consideration for the basic annuity contract or deposit fund.
Considerations applicable to optional benefits, such as disability premium
waiver, should be excluded.
1. A statement of
all fees, charges and loading amounts that are or may be deducted from initial
or subsequent considerations paid or that are or may be deducted from the
contract or fund values prior to or at contract maturity, including but not
limited to any surrender penalties, discontinuance fees, partial surrender or
withdrawal penalties or fees, transaction fees, and account maintenance
fees.
2. A statement of the
interest rates used in calculating the guaranteed and illustrative contract or
fund values.
3. The yield on gross
considerations at the end of ten years (if the annuity payments have not yet
commenced) and at the scheduled commencement of annuity payments. For contracts
without surrender values, only the yield at the scheduled commencement of
annuity payments need be shown. The yield shall be figured on the basis of the
contract value used to determine the annuity payments. These yield figures
shall be shown on both a guaranteed and illustrative basis. They represent the
effective annual interest rates at which the accumulation of 100% of all gross
considerations would be equal to the guaranteed and illustrative cash surrender
values at the points specified. For contracts without surrender values the
yields shall be figured on the basis of the contract values used to determine
annuity payments at the points specified.
(l) The date on which the Contract Summary is
prepared.
O.C.G.A. Secs.
33-2-9,
33-6-12.
