Iowa Administrative Code › Agency 191 - Insurance Division › Regulated Industries › Chapter 112 - Term and Universal Life Insurance Reserve Financing › Rule 191-112.5 - Definitions

Current through Register Vol. 47, No. 3, July 24, 2024
"Actuarial method"
means the methodology
				  used to determine the required level of primary security, as described in rule
				  191-112.6(521B).
"Covered policies"
means the following:
				  Subject to the exemptions described in rule 191-112.4 (521B), covered policies
				  are those policies, other than grandfathered policies, of the following policy
				  types:
1. Life insurance policies with guaranteed nonlevel gross
				  premiums or guaranteed nonlevel benefits or both, except for flexible premium
				  universal life insurance policies; or
2. Flexible premium universal life insurance policies with
				  provisions resulting in the ability of a policyholder to keep a policy in force
				  over a secondary guarantee period.
"Grandfathered policies"
means policies of
				  the types described in the definition of "covered policies" above that
				  were:
1. Issued prior to January 1, 2015; and
2. Ceded, as of December 31, 2014, as part of a reinsurance
				  treaty that would not have met one of the exemptions set forth in rule
				  191-112.4(521B) had that rule then been in effect.
"Noncovered policies"
means any policy that
				  does not meet the definition of "covered policies," including grandfathered
				  policies.
"Other security"
means any security
				  acceptable to the commissioner other than security meeting the definition of
				  "primary security."
"Primary security"
means the following forms
				  of security:
1. Cash meeting the requirements of Iowa Code section
				  521B.103(2)
"a"
;
2. Securities listed by the NAIC Securities Valuation Office
				  meeting the requirements of Iowa Code section
				  521B103(2).
"b,"
but excluding any synthetic letter of credit, contingent
				  note, credit-linked note or other similar security that operates in a manner
				  similar to a letter of credit, and excluding any securities issued by the
				  ceding insurer or any of its affiliates; and
3. For security held in connection with funds-withheld and
				  modified coinsurance reinsurance treaties:
* Commercial loans in good standing of CM3 quality and
				  higher;
* Policy loans; and
* Derivatives acquired in the normal course and used to
				  support and hedge liabilities pertaining to the actual risks in the policies
				  ceded pursuant to the reinsurance treaty.
"Required level of primary security"
means
				  the dollar amount determined by applying the actuarial method to the risks
				  ceded with respect to covered policies, but not more than the total reserve
				  ceded.
"Valuation manual"
means the valuation
				  manual adopted by the NAIC as described in Iowa Code section
				  508.36(14)
"b"
(1), with all amendments adopted by the NAIC that
				  are effective for the financial statement date on which credit for reinsurance
				  is claimed.
"VM-20"
means "Requirements for
				  Principle-Based Reserves for Life Products," including all relevant
				  definitions, from the valuation manual.