Section R. 500.629 - Variable annuity; contract requirementsRule 629.
(1) A contract for an annuity on a variable basis shall not be delivered in this state unless it stipulates the investment increment factors to be used in computing the dollar amount of variable benefits or other variable contractual payments or values thereunder. An individual contract for an annuity on a variable basis shall not be delivered or issued for delivery in this state, unless all of the following provisions are complied with: (a) It contains a provision specifying the options available in the event of default in a periodic stipulated payment, which options may include an option to surrender the contract for a cash value as determined by the contract and shall include an option to receive a paid-up annuity if the contract is not surrendered for cash.(b) It stipulates the expense and mortality components used in determining the factor which is used in calculating the first annuity payment. Expense may exclude some or all taxes as may be provided by the contract.(c) The annual net investment increment assumption does not exceed 5%, except with the approval of the commissioner.(d) The mortality factor is determined from an annuity mortality table authorized by section 835 of the insurance code of 1956, as amended, being S500.835 of the Michigan Compiled Laws, or any modification of the table approved by the commissioner, or any other table so approved.(2) The insurer shall disclose, in writing, before or at the time of delivery of the policy, the actual or maximum charges to be applied each year against variable annuity contracts for investment management expenses, including internal costs attributable to the investment management of assets of the separate account.Mich. Admin. Code R. 500.629
1954 ACS 67, Eff. Mar. 26, 1971; 1954 ACS 98, Eff. Dec. 23, 1978; 1979 AC; 1988 MR 7, Eff. Aug. 12, 1988