New York Codes, Rules and Regulations › Title 11 - INSURANCE › Chapter III - Policy and Certificate Provisions › Subchapter A - Life, Accident and Health Insurance › Part 50 - Separate Accounts and Separate Account Contracts › Subpart 50-1 - Separate Accounts and Separate Account Contracts Prior to January 1, 2023 › Section 50-1.6 - Variable annuity contracts

Current through Register Vol. 46, No. 28, July 10, 2024
(a) Every
					 variable annuity contract shall be subject to the following provisions:
(1) Each variable annuity contract delivered
					 or issued for delivery in this State shall provide that neither expenses
					 actually incurred, other than taxes on the investment return, nor mortality
					 actually experienced, shall adversely affect the dollar amount of variable
					 annuity payments to any annuitant for whom variable annuity payments have
					 commenced. Where a group variable annuity contract provides that the scale of
					 charges to be made against the assets of a separate account may be changed
					 without the consent of the participants for whom variable annuity payments have
					 commenced, the contract shall provide that such changes may not adversely
					 affect the dollar amount of variable annuity payments which have commenced. The
					 method of computing the dollar amount of variable annuity payments shall be
					 such that, if the annual rate of investment return of the separate account, as
					 defined in section 50-1.1(a)(6)  of this Subpart, were six and one-half percent
					 at all times from the issue of the contract, such amounts would not decrease.
					 The superintendent may authorize the use of other methods or rates in computing
					 the dollar amount of variable annuity payments where such methods or rates are
					 determined by the superintendent to be fair, equitable, reasonable, and not
					 less favorable to participants or annuitants.
(2) The reserve liability for variable
					 annuities shall be established in compliance with the applicable provisions of
					 section 4217  of the Insurance Law, as amended, and
					 in accordance with actuarial procedures that recognize the variable nature of
					 the benefits provided and their dependence on the net investment return of the
					 separate account or accounts. With respect to individual variable annuities,
					 the mortality table used in calculating the reserve liability shall be:
(i) the annuity table for 1949 with
					 projection scale B; or
(ii) the
					 progressive annuity table applicable to persons born in 1900, adjusted by a
					 setback of one year of age for each complete 25 years by which the year of
					 birth is later than 1900, and a set-forward of one year with respect to lives
					 born before 1900; or
(iii) any
					 other table approved by the superintendent. With respect to group variable
					 annuities, the mortality table used in calculating the reserve liability shall
					 be:
(a) the group annuity mortality table for
					 1951, projected to the year of retirement, using projection scale C;
					 or
(b) any other table approved by
					 the superintendent. In determining the valuation factors for group variable
					 annuities, a five-year grouping of calendar years of retirement may be
					 used.
(3)
					 Except as otherwise permitted by the superintendent, each authorized insurance
					 company issuing variable annuity contracts shall accumulate an annuitant
					 mortality fluctuation fund or funds over and above the required contract
					 reserves and liabilities, pursuant to a plan for such accumulation which
					 specifies reasonable maximum targets for such fund or funds and is approved by
					 the superintendent as otherwise reasonable. Losses arising from mortality
					 actually experienced shall first be charged against such mortality fluctuation
					 fund or funds until such fund or funds are exhausted and shall then be charged
					 against the special contingent reserve fund.