Texas Administrative Code
Title 28 - INSURANCE
Part 1 - TEXAS DEPARTMENT OF INSURANCE
Chapter 3 - LIFE, ACCIDENT, AND HEALTH INSURANCE AND ANNUITIES
Subchapter EE - VALUATION OF LIFE INSURANCE POLICIES
Section 3.4503 - Applicability
Universal Citation: 28 TX Admin Code § 3.4503
Current through Reg. 50, No. 13; March 28, 2025
This subchapter applies to all life insurance policies, with or without nonforfeiture values, issued on or after January 1, 2000, and before January 1, 2017, subject to the following exceptions in paragraph (1) of this section and conditions in paragraph (2) of this section. For all life insurance policies, with or without nonforfeiture values, issued on or after January 1, 2017, the requirements of the valuation manual adopted under Insurance Code Chapter 425, Subchapter B, apply.
(1) Exceptions.
(A) This subchapter shall not apply to any
individual life insurance policy issued on or after the effective date of this
subchapter if the policy is issued in accordance with and as a result of the
exercise of a reentry provision contained in the original life insurance policy
of the same or greater face amount, issued before the effective date of this
subchapter, that guarantees the premium rates of the new policy. This
subchapter also shall not apply to subsequent policies issued as a result of
the exercise of such a provision, or a derivation of the provision, in the new
policy.
(B) This subchapter shall
not apply to any universal life policy that meets all the following
requirements:
(i) secondary guarantee period,
if any, is five years or less;
(ii)
specified premium for the secondary guarantee period is not less than the net
level reserve premium for the secondary guarantee period based on the 1980 CSO
valuation tables and the applicable valuation interest rate; and
(iii) the initial surrender charge is not
less than 100% of the first year annualized specified premium for the secondary
guarantee period.
(C)
This subchapter shall not apply to any variable life insurance policy that
provides for life insurance, the amount or duration of which varies according
to the investment experience of any separate account or accounts.
(D) This subchapter shall not apply to any
variable universal life insurance policy that provides for life insurance, the
amount or duration of which varies according to the investment experience of
any separate account or accounts.
(E) This subchapter shall not apply to a
group life insurance certificate unless the certificate provides for a stated
or implied schedule of maximum gross premiums required in order to continue
coverage in force for a period in excess of one year.
(2) Conditions.
(A) Calculation of the minimum valuation
standard for policies with guaranteed Nonlevel gross premiums or guaranteed
nonlevel benefits (other than universal life policies), or both, shall be in
accordance with the provisions of §
3.4506 of this title (relating to
Calculation of Minimum Valuation Standard for Policies with Guaranteed Nonlevel
Gross Premiums or Guaranteed Nonlevel Benefits (Other than Universal Life
Policies)).
(B) Calculation of the
minimum valuation standard for flexible premium and fixed premium universal
life insurance policies, that contain provisions resulting in the ability of a
policyholder to keep a policy in force over a secondary guarantee period, shall
be in accordance with the provisions of §
3.4507 of this title (relating to
Calculation of Minimum Valuation Standard for Flexible Premium and Fixed
Premium Universal Life Insurance Policies That Contain Provisions Resulting in
the Ability of a Policyowner to Keep a Policy in Force Over a Secondary
Guarantee Period).
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