N.Y. Comp. Codes R. & Regs. tit. 11 § 54.9

Current through Register Vol. 46, No. 43, October 23, 2024

Section 54.9 - Information furnished to applicants

An insurer delivering or issuing for delivery in this State any variable life insurance policies shall deliver to the applicant for the policy, and obtain a written acknowledgment of receipt from such applicant coincident with or prior to the execution of the application, a private placement offering memorandum in the case of a private placement variable life insurance policy or a prospectus included in a registration statement relating to the policy in the case of any other variable life insurance policy. The prospectus must satisfy the requirements of the Federal Securities Laws, have been declared effective by the Securities and Exchange Commission, and include the following information:

(a) A summary explanation, in nontechnical terms, of the principal features of the policy, including a description of the manner in which the variable benefits will reflect the investment experience of the separate account and the factors which affect such variation. Such explanation must include notices of the provisions required by section 54.6(b)(1)(v) and (b)(7) of this Part. This summary shall include:

(1) a statement that the death benefit may be variable or fixed under specified conditions;

(2) a statement that policy values may increase or decrease in accordance with the experience of the separate account (subject to any specified minimum guarantees); and

(3) a statement that, in the case of a variable endowment policy, the amount of the endowment payable at maturity is not guaranteed but is dependent upon the then cash surrender value (subject to any specified minimum guarantees).

(b) A statement of the investment policy of the separate account, including:

(1) a description of the investment objective intended for the separate account, the principal types of investments intended to be made, and any restrictions or limitations on such investments; and

(2) any restriction or limitation on the manner in which the operations of the separate account are intended to be conducted.

(c) A statement of the net investment return of the separate account for each of the last 10 years, or such lesser period as the separate account has been in existence.

(d) A statement of the charges levied against the separate account during the previous year or which may be levied against the separate account, including but not limited to the following:

(1) taxes or reserves for taxes attributable to investment gains and income of the separate account;

(2) actual cost of reasonable brokerage fees and similar direct acquisition and sales costs incurred in the purchase or sale of separate account assets;

(3) actuarialy determined costs of insurance (tabular costs) and the release of reserve and benefit base consistent with the release of separate account liabilities;

(4) charges for administrative expenses and investment management expenses, including internal costs attributable to the investment management of assets of the separate account;

(5) a charge, at a rate specified in the policy, for mortality and expense guarantees;

(6) any amounts in excess of those required to be held in the separate account; and

(7) charges for incidental insurance benefits.

(e) A summary of the method to be used in valuing assets held by the separate account.

(f) A summary of the Federal income tax aspects of the policy applicable to the insured, the policyowner and the beneficiary.

(g) Such additional information concerning the variable life insurance operations or the variable life insurance separate accounts as the superintendent may deem necessary.

N.Y. Comp. Codes R. & Regs. Tit. 11 § 54.9