Code of Maine Rules › 02 - DEPARTMENT OF PROFESSIONAL AND FINANCIAL REGULATION › 031 - BUREAU OF INSURANCE › Chapter 300 - VARIABLE LIFE INSURANCE RULE › Article VI - Insurance Policy Requirements › Section 031-300-VI-2 - Mandatory Policy Benefit and Design Requirements

Current through 2024-29, July 17, 2024
Variable life insurance policies delivered or issued for
					 delivery in this state shall comply with the following minimum
					 requirements:
a. Mortality and expense
				  risks shall be borne by the insurer.
The mortality and expense charges shall be subject to the
					 maximums stated in the contract;
b. For scheduled premium policies, a minimum
				  death benefit shall be provided in an amount at least equal to the initial face
				  amount of the policy so long as premiums are duly paid (subject to the
				  provisions of Section 4 of this Article);
c. The policy shall reflect the investment
				  experience of one or more separate accounts established and maintained by the
				  insurer. The insurer must demonstrate that the reflection of investment
				  experience in the variable life insurance policy is actuarially
				  sound;
d. Each variable life
				  insurance policy shall be created with the full amount of the net investment
				  return applied to the benefit base;
e Any changes in variable death benefits of
				  each variable life insurance policy shall be determined at least
				  annually;
f. The cash value of each
				  variable life insurance policy shall be determined at least monthly. The method
				  of computation of cash values and other non-forfeiture benefits, as described
				  in the policy shall be in accordance with actuarial procedures that recognize
				  the variable nature of the policy. The method of computation must be such that,
				  if the net investment return credited to the policy at all times from the date
				  of issue should be equal to the assumed investment rate with premiums and
				  benefits determined accordingly under the terms of the policy, then the
				  resulting cash values and other non-forfeiture benefits must be at least equal
				  to the minimum values required by Section 2530 et seq. of the Maine Insurance
				  Code (Title 24-A, M.R.S.A.) for a general account policy with such premiums and
				  benefits. The assumed investment rate shall not exceed the maximum interest
				  rate permitted under the Standard Non-Forfeiture Law of this state. If the
				  policy does not contain an assumed investment rate this demonstration shall be
				  based on the maximum interest rate permitted under the Standard Non-Forfeiture
				  Law. The method of computation may disregard incidental minimum guarantees as
				  to the dollar amounts payable. Incidental minimum guarantees include, for
				  example, but are not to be limited to, a guarantee that the amount payable at
				  death or maturity shall be at least equal to the amount that otherwise would
				  have been payable if the net investment return credited to the policy at all
				  times from the date of issue had been equal to the assumed investment rate;
				  and
g. The computation of values
				  required for each variable life insurance policy may be based upon such
				  reasonable and necessary approximations as are acceptable to the
				  Superintendent.