New York Codes, Rules and Regulations › Title 11 - INSURANCE › Chapter III - Policy and Certificate Provisions › Subchapter A - Life, Accident and Health Insurance › Part 53 - Life And Annuity Cost Disclosure And Sales Illustrations › Subpart 53-3 - Life Illustrations And Reports › Section 53-3.3 - Standards for basic illustrations

Current through Register Vol. 46, No. 28, July 10, 2024
(a)
Format.
A basic illustration shall conform with the following
						requirements:
(1) The illustration
					 shall be labeled with the date on which it was prepared.
(2) Each page, including any explanatory
					 notes or pages, shall be numbered and show its relationship to the total number
					 of pages in the illustration (
e.g.,
the fourth page of a
					 seven-page illustration shall be labeled "page 4 of 7 pages").
(3) The assumed dates of payment receipt and
					 benefit pay-out within a policy year shall be clearly identified.
(4) If the age of the proposed insured is
					 shown as a component of the tabular detail, it shall be the issue age plus the
					 number of years the policy is assumed to have been in force.
(5) The assumed payments on which the
					 illustrated benefits and values are based shall be identified as premium outlay
					 or contract premium, as applicable. For policies that do not require a specific
					 contract premium, the illustrated payments shall be identified as premium
					 outlay.
(6) Guaranteed death
					 benefits and values available upon surrender, if any, for the illustrated
					 premium outlay or contract premium shall be shown and clearly labeled
					 guaranteed.
(7) If the illustration
					 shows any non-guaranteed elements, they cannot be based on a scale more
					 favorable to the policyowner than the insurer's illustrated scale at any
					 duration. These elements shall be clearly labeled non-guaranteed.
(8) The guaranteed elements, if any, shall be
					 shown before corresponding non-guaranteed elements and shall be specifically
					 referred to on any page of an illustration that shows or describes only the
					 non-guaranteed elements (
e.g.,
"see page one for guaranteed
					 elements").
(9) The account or
					 accumulation value of a policy, if shown, shall be identified by the name this
					 value is given in the policy being illustrated and shown in close proximity to
					 the corresponding value available upon surrender.
(10) The value available upon surrender shall
					 be identified by the name the value is given in the policy being illustrated
					 and shall be the amount available to the policyowner in a lump sum after
					 deduction of surrender charges, policy loans and policy loan interest, as
					 applicable.
(11) Illustrations may
					 show policy benefits and values in graphic or chart form in addition to the
					 tabular form.
(12) Any illustration
					 of non-guaranteed elements shall be accompanied by a statement indicating that:
(i) the benefits and values are not
					 guaranteed;
(ii) the assumptions on
					 which they are based are subject to change by the insurer; and
(iii) actual results may be more or less
					 favorable.
(13) If the
					 illustration shows that the premium payer may have the option to allow policy
					 charges to be paid using non-guaranteed values, the illustration must clearly
					 disclose that a charge continues to be required and that, depending on actual
					 results, the premium payer may need to continue or resume premium outlays.
					 Similar disclosure shall be made for premium outlay of lesser amounts or
					 shorter durations than the contract premium. If a contract premium is due, the
					 premium outlay display shall not be left blank or show zero unless accompanied
					 by an asterisk or similar mark to draw attention to the fact that the policy is
					 not paid up.
(14) If the applicant
					 plans to use dividends or policy values, guaranteed or non-guaranteed, to pay
					 all or a portion of the contract premium or policy charges, or for any other
					 purpose, the illustration may reflect those plans and the impact on future
					 policy benefits and values.