Louisiana Administrative Code › Title 37 - INSURANCE › Part XIII - Regulations › Chapter 33 - Regulation 55-Life Insurance Illustrations › Section XIII-3305 - Definitions

Current through Register Vol. 50, No. 6, June 20, 2024
A. For the purposes
				of this regulation:
Actuarial Standards Board
- the board
				  established by the American Academy of Actuaries to develop and promulgate
				  standards of actuarial practice.
Contract Premium
- the gross premium that is
				  required to be paid under a fixed premium policy, including the premium for a
				  rider for which benefits are shown in the illustration.
Currently Payable Scale
- a scale of
				  non-guaranteed elements in effect for a policy form as of the preparation date
				  of the illustration or declared to become effective within the next 95
				  days.
Department
- the Louisiana Department of
				  Insurance.
Disciplined Current Scale
- a scale of
				  non-guaranteed elements constituting a limit on illustrations currently being
				  illustrated by an insurer that is reasonably based on actual recent historical
				  experience, as certified annually by an illustration actuary designated by the
				  insurer. Further guidance in determining the disciplined current scale as
				  contained in standards established by the Actuarial Standards Board may be
				  relied upon if the standards:
a. are consistent with all provisions of this
				  regulation;
b. limit a disciplined current scale to reflect only actions
				  that have already been taken or events that have already occurred;
c. do not permit a disciplined current scale to include any
				  projected trends of improvements in experience or any assumed improvements in
				  experience beyond the illustration date; and
d. do not permit assumed expenses to be less than minimum
				  assumed expenses.
a.
Guaranteed Elements
- the premiums,
				  benefits, values, credits, or charges under a policy of life insurance that are
				  guaranteed and determined at issue.
b.
Non-Guaranteed Elements
- the premiums,
				  benefits, values, credits, or charges under a policy of life insurance that are
				  not guaranteed or not determined at issue.
a. the disciplined current scale; or
b. the currently payable scale.
a.
Basic Illustration
- a ledger or proposal
				  used in the sale of a life insurance policy that shows both guaranteed and
				  non-guaranteed elements.
b.
In Force Illustration
- an illustration
				  furnished at any time after the policy that it depicts has been in force for
				  one year or more.
c.
Supplemental Illustration
- an illustration
				  furnished in addition to a basic illustration that meets the applicable
				  requirements of this regulation, and that may be presented in a format
				  differing from the basic illustration, but may only depict a scale of
				  non-guaranteed elements that is permitted in a basic illustration.
a. the minimum expenses that may be used in the calculation
				  of the disciplined current scale for a policy form. The insurer may choose to
				  designate each year the method of determining assumed expenses for all policy
				  forms from the following:
i. fully allocated expenses;
ii. marginal expenses; and
iii. a generally recognized expense table based on fully
				  allocated expenses representing a significant portion of insurance companies
				  and approved by the department.
b. Marginal expenses may be used only if greater than a
				  generally recognized expense table. If no generally recognized expense table is
				  approved, fully allocated expenses must be used.
a. every plan of coverage was selected by the employer or
				  other group representative;
b. some portion of the premium is paid by the group or
				  through payroll deduction; and
c. group underwriting or simplified underwriting is
				  used.
Policy Owner
- the owner named in the policy
				  or the certificate holder in the case of a group policy.
Premium Outlay
- the amount of premium
				  assumed to be paid by the policy owner or other premium payer
				  out-of-pocket.
Self-Supporting Illustration
- an
				  illustration of a policy form for which it can be demonstrated that, when using
				  experience assumptions underlying the disciplined current scale, for all
				  illustrated points in time on or after the 15 policy anniversary or the 20
				  policy anniversary for second-or-later-to-die policies (or upon policy
				  expiration, if sooner), the accumulated value of all policy cash flows equals
				  or exceeds the total policy owner value available. For this purpose, policy
				  owner value will include cash surrender values and any other illustrated
				  benefit amounts available at the policy owner's election.
AUTHORITY NOTE:
				  Promulgated in accordance with
				  R.S.
				  22:3.