Statutes, codes, and regulations
Maine Administrative Code
Department 02 - DEPARTMENT OF PROFESSIONAL AND FINANCIAL REGULATIONDivision 031 - BUREAU OF INSURANCEChapter 340 - MORTALITY TABLES FOR DETERMINING MINIMUM RESERVES AND NONFORFEITURE BENEFITS
Article III - Procedure for Use of Same Minimum Nonforfeiture Standards for Men and Women Insured Under 1980 CSO and 1980 CET Mortality Tables
Section 031-340-III-1 - Preamble

02-031-340 Me. Code R. § III-1

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Current through 2025-03, January 15, 2025
Section 031-340-III-1 - Preamble

The U.S. Supreme Court in its decision in Arizona Governing Committee v. Norris makes it illegal for an employer to make contributions after August 1, 1983 to a defined contribution pension plan if the benefits derived from those contributions differ by sex. Although there is some uncertainty as to the breadth of the Supreme Court's decision, it would seem to require that after August 1, 1983, employer pension plans may need to be funded by life insurance products that have identical nonforfeiture values for men and women. Since the 1980 CSO and 1980 CET Mortality Tables contain mortality rates that vary by both age and sex, it is very difficult if not impossible for companies to determine actual nonforfeiture values that are identical for men and women and also satisfy a sex-differentiated minimum standard. For this reason, this rule permits the same minimum nonforfeiture standards for men and women insureds under the 1980 CSO and 1980 CET Mortality Tables.

A few background comments may be helpful in understanding the intent of this Article.

(1) No attempt was made to define which policies and situations are covered by the Norris decision and which are not. The breadth of the Norris decision is unclear and may ultimately have to be resolved by further court decisions or Federal Legislation.
(2) Insurers are given flexibility to use either
(a) The existing tables with mortality rates that vary by age and sex, or
(b) Tables of mortality rates which are a blend of the male and female mortality rates.
(3) No change is made in minimum valuation standards, since these do not involve any contractual relationship between the insurer and its policyholder clients and the Supreme Court did not address state statutory valuation standards.
(4) Section 5 is included to make it clear that an insurer who issues the same kind of policy on a sex-distinct basis in some circumstances and on a sex-neutral basis in others shall not be deemed to be in violation of the state unfair discrimination laws.
(5)(repealed)
(6)(repealed)

02-031 C.M.R. ch. 340, § III-1