South Dakota Administrative Rules
Title 20 - PUBLIC SAFETY
Article 20:06 - INSURANCE
Chapter 20:06:07 - Variable annuity contracts
Section 20:06:07:05 - Contracts providing for variable benefits
Current through Register Vol. 50, page 114, March 25, 2024
Features required are as follows:
(1) Any variable contract providing benefits payable in variable amounts delivered or issued for delivery in this state shall contain a statement of the essential features of the procedures to be followed by the insurance company in determining the dollar amount of the variable benefits. Any such contract, including a group contract and any certificate issued under it, shall state that the dollar amount will vary to reflect investment experience. The contract shall contain on its first page a clear statement to the effect that the benefits under it are on a variable basis;
(2) Illustrations of benefits payable under any contract providing benefits payable in variable amounts shall not include projections of past investment experience into the future or attempted predictions of future investment experience. Nothing contained in this subdivision is intended to prohibit use of hypothetical assumed rates of return to illustrate possible levels of annuity payments;
(3) No individual variable annuity contract calling for the payment of periodic stipulated payments may be delivered or issued for delivery in this state unless it contains in substance the following provisions or provisions which in the opinion of the director are more favorable to the holders of such contracts:
(4) An individual variable annuity contract delivered or issued for delivery in this state shall stipulate the expense, mortality, and investment increment factors to be used in computing the dollar amount of variable benefits or other contractual payments or values under it, and may guarantee that expense, mortality results or both shall not adversely affect such dollar amounts. The following provisions apply in computing the dollar amount of variable benefits or other contractual payments or values under an individual variable annuity contract:
(5) The reserve liability for variable annuities shall be established pursuant to the requirements of SDCL 58-26 in accordance with actuarial procedures that recognize the variable nature of the benefits provided.
General Authority: SDCL 58-28-31.
Law Implemented: SDCL 58-28-31.