Current through Vol. 42, No. 8, January 2, 2025
Section 365:10-5-81 - Valuation(a)Requirements. The minimum valuation standard for universal life insurance policies shall be the Commissioners Reserve Valuation Method, as described below for such policies, and the tables and interest rated specified below. (1) The terminal reserve for the basic policy and any benefits and/or riders for which premiums are not paid separately as of any policy anniversary shall be calculated as follows.(2) Future guaranteed benefits, as used in the formula in (1) of this subsection, are determined by: (A) projecting the greater of the Guaranteed Maturity Fund and the policy value, taking into account future Guaranteed Maturity Premiums, if any, and using all guarantees of interest, mortality, expense deductions, etc., contained in the policy or declared by the insurer; and(B) taking into account any benefits guaranteed in the policy or by declaration which do not depend on the policy value.(3) All present values in the formula in (1) of this subsection shall be determined using: (A) an interest rate (or rates) specified by 36 O.S. § 1510 for policies issued in the same year; (B) the mortality rates specified by the 36 O.S. § 1510, for policies issued in the same year or contained in such other table as may be approved by the Commissioner for this purpose; and(C) any other tables needed to value supplementary benefits provided by a rider which is being valued together with the policy.(b)Alternative Minimum Reserves.(1) If, in any policy year, the Guaranteed Maturity Premium on any universal life insurance policy is less than the valuation net premium for such policy, calculated by the valuation method actually used in calculating the reserve thereon but using the minimum valuation standards of mortality and rate of interest, the minimum reserve required for such contract shall be the greater of: (A) The reserve calculated according to the method, the mortality table, and the rate of interest actually used.(B) The reserve calculated according to the method actually used but using the minimum valuation standards of mortality and rate of interest and replacing the valuation net premium by the Guaranteed Maturity Premium in each policy year for which the valuation net premium exceeds the Guaranteed Maturity Premium.(2) For universal life insurance reserves on a net level premium basis, the valuation net premium is EqnPVFBxa and for ax reserves on a Commissioners Reserve Valuation Method, the valuation net premium is EqnPVFBxa+a-bx a.Okla. Admin. Code § 365:10-5-81
Amended by Oklahoma Register, Volume 40, Issue 23, August 15, 2023, eff. 9/1/2023