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  #1  
Old 01-24-2018, 10:09 PM
minnesotalu minnesotalu is offline
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Default XX state regulations

If domicile state XX adopted NAIC valuation manual, does it mean that all model regulations apply in XX? I am looking at ACLI website and I see the state XX has not adopted any regulations related to the product I am interested (guaranteed separate accounts), I wonder if they would apply by reference through XX's adoption of NAIC valuation manual.
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Old 01-25-2018, 01:02 PM
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Has the State in question specifically prohibited using a guaranteed separate account? From 15-20 years ago I recall Minnesota being one that specifically rejected a GSA, but not sure of the current state of play.
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Old 01-25-2018, 03:14 PM
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VM adoption does not automatically mean adoption of NAIC Model Regulations. However, some states enforce some model reg provisions if they believe that they are the most appropriate interpretation of their state statutes. For example, not many states adopted the UL Model Reg (adopted by the NAIC in 1983), but over the years most states came to believe it to be the best interpretation of the underlying SVL.
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Old 02-06-2018, 03:01 PM
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Originally Posted by kazh View Post
VM adoption does not automatically mean adoption of NAIC Model Regulations. However, some states enforce some model reg provisions if they believe that they are the most appropriate interpretation of their state statutes. For example, not many states adopted the UL Model Reg (adopted by the NAIC in 1983), but over the years most states came to believe it to be the best interpretation of the underlying SVL.
Doesn't it, though? Now that the model regulations are specified in Appendix VM-A? Unless, like MetsFan noted, there is explicit deviation from the model regulation within a state because they intended it that way.

Another example is Regulation XXX (Valuation of Life Insurance Policies) - some states have not adopted the 2009 version of the model reg, while others have not adopted it at all.
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Old 02-08-2018, 04:12 PM
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Cool Model Reg <> State Law

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Doesn't it, though? Now that the model regulations are specified in Appendix VM-A? Unless, like MetsFan noted, there is explicit deviation from the model regulation within a state because they intended it that way.

Another example is Regulation XXX (Valuation of Life Insurance Policies) - some states have not adopted the 2009 version of the model reg, while others have not adopted it at all.
AGs in the SSAP appendices have gotten mixed opinions from state lawyers (and some of them are shown in summary or edited form in the SSAP, increasing their ambiguous position with regard to the law). It's unclear how the appendices to the VM will be viewed. It would be awkward to assume that they represent state law in many cases, because the model regs have usually been edited to fit the existing state legal structure before a state adopts them.

It's wise to keep in mind that the VM is supposed to operate prospectively, i.e., applicable only to new issues. It is very unclear if that would affect contracts issued in transition years 2018-20 if the insurer chooses to defer their application. Conflicts between model provisions and any new or revised state regulations will also be difficult to resolve.
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Old 02-13-2018, 05:15 PM
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Doesn't it, though? Now that the model regulations are specified in Appendix VM-A? Unless, like MetsFan noted, there is explicit deviation from the model regulation within a state because they intended it that way.

Another example is Regulation XXX (Valuation of Life Insurance Policies) - some states have not adopted the 2009 version of the model reg, while others have not adopted it at all.
Some states take the position that a model applies even though it hasn't been officially adopted. It's wise to be careful not to assume that a model reg isn't applicable (e.g., the UL Model), if only because it might be the best interpretation of the underlying statute. Companies have to exercise caution when compliance is encouraged by a regulator.
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Old 02-19-2018, 02:29 PM
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If more of the AGs were NAIC accreditation standards, it would eliminate much of the confusion as well as opposition to the models by certain states. Getting model regs adopted is becoming an increasingly daunting task due to politically-driven state legislative oversight requirements. Uniformity seems the best way to avoid the unfortunate intervention of the SEC, FSOC, and FIO.
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Old 02-20-2018, 01:57 PM
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The NAIC should work to get updated model regs directly into the VM ASAP.
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