Reply To: Nonforfeiture Rate Changes

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Chuck Ritzke

For plans that have cash values that need to change (or maybe surrender charges on a UL contract), I’d review the Statement of Variability (SOV) in the state (or compact) where it was filed. If the company reserved the right to change the rates/values without restriction, then you can probably make changes without re-filing. However, some states will have explicitly asked for you to file a new actuarial memo or maybe new sample schedule pages. In any case, I’d recommend preparing those things and having them ready to file if ever requested.

Similarly, many forms of term insurance may require a re-demonstration to prove cash values are not required. Again, states may not require the filing, but I would recommend having such demonstrations prepared and ready just in case.

If you want more definitive answers, you can contact the insurance dept or compact. (We often do that anonymously for carriers).

I don’t think reserve interest rates are required (from a product filing standpoint). Of course, your valuation actuary has different requirements from a valuation reporting standpoint.