This subchapter applies to all life insurance policies,
with or without nonforfeiture values, issued on or after January 1, 2000, and
before January 1, 2017, subject to the following exceptions in paragraph (1) of
this section and conditions in paragraph (2) of this section. For all life
insurance policies, with or without nonforfeiture values, issued on or after
January 1, 2017, the requirements of the valuation manual adopted under
Insurance Code Chapter 425, Subchapter B, concerning Standard Valuation Law,
apply.
(1) Exceptions.
(A) This subchapter does not apply to any
individual life insurance policy issued on or after the effective date of this
subchapter if the policy is issued in accordance with, and as a result of, the
exercise of a reentry provision contained in the original life insurance policy
of the same or greater face amount, issued before the effective date of this
subchapter, that guarantees the premium rates of the new policy. This
subchapter also does not apply to subsequent policies issued as a result of the
exercise of such a provision, or a derivation of the provision, in the new
policy.
(B) This subchapter does
not apply to any universal life policy that meets all the following
requirements:
(i) secondary guarantee period,
if any, is five years or less;
(ii)
specified premium for the secondary guarantee period is not less than the net
level reserve premium for the secondary guarantee period based on the 1980 CSO
valuation tables and the applicable valuation interest rate; and
(iii) the initial surrender charge is not
less than 100% of the first year annualized specified premium for the secondary
guarantee period.
(C)
This subchapter does not apply to any variable life insurance policy that
provides for life insurance, the amount or duration of which varies according
to the investment experience of any separate account or accounts.
(D) This subchapter does not apply to any
variable universal life insurance policy that provides for life insurance, the
amount or duration of which varies according to the investment experience of
any separate account or accounts.
(E) This subchapter does not apply to a group
life insurance certificate unless the certificate provides for a stated or
implied schedule of maximum gross premiums required in order to continue
coverage in force for a period in excess of one year.
(2) Conditions.
(A) Calculation of the minimum valuation
standard for policies with guaranteed nonlevel gross premiums or guaranteed
nonlevel benefits (other than universal life policies), or both, must be in
accordance with the provisions of §
4.2826 of this title (relating to
Calculation of Minimum Valuation Standard for Policies with Guaranteed Nonlevel
Gross Premiums or Guaranteed Nonlevel Benefits (Other than Universal Life
Policies)).
(B) Calculation of the
minimum valuation standard for flexible premium and fixed premium universal
life insurance policies, that contain provisions resulting in the ability of a
policyholder to keep a policy in force over a secondary guarantee period, must
be in accordance with the provisions of §
4.2827 of this title (relating to
Calculation of Minimum Valuation Standard for Flexible Premium and Fixed
Premium Universal Life Insurance Policies That Contain Provisions Resulting in
the Ability of a Policyowner to Keep a Policy in Force Over a Secondary
Guarantee Period).
Notes
28
Tex. Admin. Code §
4.2823
Adopted by
Texas
Register, Volume 49, Number 03, January 19, 2024, TexReg
0264, eff.
1/24/2024
