§431:10D-409 - Annual certifications.

§431:10D-409 Annual certifications.
(a) The board of directors of each insurer shall appoint one or more
illustration actuaries.

(b) The illustration actuary shall certify
that the disciplined current scale used in illustrations is in conformity with
the Actuarial Standard of Practice for Compliance with the National Association
of Insurance Commissioners' Model Regulation on Life Insurance Illustrations
promulgated by the Actuarial Standards Board, and that the illustrated scales
used in insurer-authorized illustrations meet the requirements of this part.

(1) Be a member in good standing of the American
Academy of Actuaries;

(2) Be familiar with the standard of practice
regarding life insurance policy illustrations;

(3) Not have been found by the commissioner,
following appropriate notice and hearing, to have:

(A) Violated any provision of, or any
obligation imposed by, the insurance law or other law in the course of acting
as an illustration actuary;

(B) Been found guilty of fraudulent or
dishonest practices;

(D) Resigned or been removed as an
illustration actuary within the past five years as a result of acts or
omissions indicated in any adverse report on examination or as a result of a
failure to adhere to generally acceptable actuarial standards;

(4) Not fail to notify the commissioner of any action
taken by a commissioner of another state similar to that under paragraph (3);

(5) Disclose in the annual certification whether,
since the last certification, a currently payable scale applicable for business
issued within the previous five years and within the scope of the certification
has been reduced for reasons other than changes in the experience factors
underlying the disciplined current scale. If nonguaranteed elements
illustrated for new policies are not consistent with those illustrated for
similar in force policies, this must be disclosed in the annual certification.
If nonguaranteed elements illustrated for both new and in force policies are
not consistent with the nonguaranteed elements actually being paid, charged, or
credited to the same or similar forms, this must be disclosed in the annual
certification; and

(6) Disclose in the annual certification the method
used to allocate overhead expenses for all illustrations:

(A) Fully allocated expenses;

(B) Marginal expenses; or

(C) A generally recognized expense table based
on fully allocated expenses representing a significant portion of insurance
companies and approved by the commissioner.

(d) The illustration actuary shall file a
certification with the board and with the commissioner:

(1) Annually for all policy forms for which
illustrations are used; and

(2) Before a new policy form is illustrated.

(e) If an error in a previous certification is
discovered, the illustration actuary shall immediately notify the board of
directors of the insurer and the commissioner.

(f) If an illustration actuary is unable to
certify the scale for any policy form illustration the insurer intends to use,
the actuary shall immediately notify the board of directors of the insurer and
the commissioner of the inability to certify.

(g) A responsible officer of the insurer,
other than the illustration actuary, shall certify annually:

(1) That the illustration formats meet the
requirements of this part and that the scales used in insurer-authorized
illustrations are those scales certified by the illustration actuary; and

(2) That the company has provided its producers or
other representatives with information about the expense allocation method used
by the company in its illustrations and disclosed as required in subsection
(c)(6).

(h) The annual certifications shall be
provided to the commissioner each year by a date determined by the insurer.

(i) If an insurer changes the illustration
actuary responsible for all or a portion of the company's policy forms, the
insurer shall notify the commissioner of that fact promptly and disclose the
reason for the change. [L 2000, c 252, pt of §2; am L 2003, c 212, §90]