New Jersey Administrative Code › Title 11 - INSURANCE › Chapter 4 - ACTUARIAL SERVICES › Subchapter 45 - PERIODIC REPORTS › Section 11:4-45.4 - Flexible factor forms; reporting requirements

Current through Register Vol. 56, No. 14, July 15, 2024
(a) For any flexible factor form where cash values and/or death benefits are subject to variation on the basis of interest, mortality, or expense factors that may be adjusted by the insurer, or on the basis of premium amounts which the policyholder may unilaterally change or choose not to pay, the insurer shall provide each policyholder with a periodic report to notify each policyholder of his or her values and benefits. The report shall satisfy, at a minimum, the following requirements:
1. The report shall be provided at least annually, and shall show values applicable at both the beginning and end of the period covered by the report;
2. The report shall show the policy status as of a date no more than two months prior to the date of the mailing of the report and shall show all increments and decrements to values and benefits since the date as of which the last previous report provided value and benefit information;
3. Individual premiums received during the period covered by the report shall be identified as to amount, date of receipt, and the date on which the insurer first credited interest thereon, unless this information was previously provided in writing to the policyholder at the time each consideration was received;
4. Interest increments shall not be aggregated over different time periods but rather shall be segregated in sufficient detail to permit verification;
5. The report shall record all interest rates which applied to loaned and unloaned amounts during the reporting period;
i. In the case of policies with "buckets" or "generations" of interest, the Commissioner shall waive the requirement set forth in (a)5 above if:
(1) The report states that the insurer will provide information regarding interest rates and the methods utilized to calculate interest credits to loaned and unloaned values to the policyholder upon request and free of charge; and
(2) The information available upon request shall record all interest rates which applied to loaned and unloaned amounts during the reporting period, together with the amounts to which such rates apply.
ii. Notwithstanding any waiver granted pursuant to (a)5i above, the report shall indicate the interest rate(s) which applied to new premiums during the reporting period;
6. The report shall display all transactions and charges allowed under the policies, which shall be recorded by date. However, the Commissioner shall waive this requirement with respect to the recording of loan activity if:
i. The report states that the insurer will provide this information to the policyholder upon request and free of charge; and
ii. The information available upon request shall record all transactions for loan activity by date; and
7. If the value of the policy is such that it would not maintain insurance in-force until the anticipated effective date of the next periodic report, the report shall include a caution that the policy may be in danger of terminating without value in the next 12 months unless additional premium is paid.