Variable Life Insurance Model Regulation

What this document is

Variable Life Insurance Model Regulation is a naic model law published by National Association of Insurance Commissioners (NAIC). It is one of the documents that insurance license exam questions are written from, including life & health practice questions. This page summarizes it and points to the official version, which is the text to rely on.

Sections cited in practice questions

Each practice answer shows the exact passage it comes from. These are sections of this document that questions cite, with a short excerpt from the source text.

• NAIC Model #270: Section 2S (Definitions: Variable life insurance policy)

  “an individual policy that provides for life insurance the amount or duration of which varies according to the investment experience of any separate account or accounts established and maintained by the insurer as to the policy, pursuant to Section [insert applicable section] of the insurance laws...”

• NAIC Model NAIC 270: Section 11A(1) (Qualification to Sell)

  “A person shall not sell or offer for sale in this state any variable life insurance policy unless the person is an agent and has filed with the commissioner, in a form satisfactory to the commissioner, evidence that the person holds a license or authorization that may be required for the...”

• NAIC Model NAIC 270: Section 9C (Reports to Policyholders)

  “For flexible premium policies, a report shall be sent to the policyholder if the amounts available under the policy on any policy processing day to pay the charges authorized by the policy are less than the amount necessary to keep the policy in force until the next following policy processing day.”

• NAIC Model NAIC 270: Section 6B (Amounts in the Separate Account)

  “The insurer shall maintain in each separate account assets with a value at least equal to the greater of the valuation reserves for the variable portion of the variable life insurance policies or the benefit base for these policies.”

• NAIC Variable Life Insurance Model Regulation, Section 9A: statement furnished after each policy anniversary

  “Within thirty (30) days after each anniversary of the policy, a statement or statements of the cash surrender value, death benefit, any partial withdrawal or policy loan, any interest charge, any optional payments allowed pursuant to Section 4E under the policy computed as of the policy anniversary date.”

• NAIC Variable Life Insurance Model Regulation § 8B (application, cash value disclosure)

  “A prominent statement that cash values may increase or decrease in accordance with the experience of the separate account (subject to any specified minimum guarantees);”

• NAIC Variable Life Insurance Model Regulation § 2C (definition of assumed investment rate)

  ““Assumed investment rate” means the rate of investment return that would be required to be credited to a variable life insurance policy, after deduction of charges for taxes, investment expenses and mortality and expense guarantees to maintain the variable death benefit equal at all times to the...”

• NAIC Variable Life Insurance Model Regulation § 7 (Information Furnished to Applicants)

  “An insurer delivering or issuing for delivery in this state a variable life insurance policy shall deliver the following to the applicant for the policy, and obtain a written acknowledgment of receipt from the applicant coincident with or prior to the execution of the application.”

• NAIC Variable Life Insurance Model Regulation § 7G (Illustrations of Benefits)

  “Illustrations of benefits payable under the variable life insurance contract. The illustrations shall be prepared by the insurer and shall not include projections of past investment experience into the future or attempted predictions of future investments experience, provided that nothing contained...”

• NAIC Variable Life Insurance Model Regulation § 3A (Licensing and Approval to do Business)

  “An insurer shall not deliver or issue for delivery in this state any variable life insurance policies unless: (1) The insurer is licensed or organized to do a life insurance business in this state; (2) The insurer has obtained the written approval of the commissioner for the issuance of variable...”

• NAIC Variable Life Insurance Model Regulation § 3F(1), reports and filings to the commissioner

  “An insurer authorized to transact the business of variable life insurance in this state shall submit to the commissioner, in addition to any other materials that may be required by this regulation or any other applicable laws or regulations: (a) An annual statement of the business of its separate...”

• NAIC Variable Life Insurance Model Regulation § 9A, flexible premium projection and warning message

  “In addition, the report shall show the projected cash value and cash surrender value, if different, as of one year from the end of the period covered by the report assuming that planned periodic premiums, if any, are paid as scheduled; guaranteed costs of insurance are deducted; and the net return...”

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