Manipulation, Lapsation, Dividend Practices and Annuity Disclosure Task Force (A) - NAIC

  • 1982-2, NAIC Proceedings
  • 1983-2 NAIC Proceedings
  • 1983-4 NAIC Proceedings
  • 1981 0602 - AAA - Journal, American Academy of Actuaries  Statement 1981-12 - p144-155 - 12p
  • 1982-2, NAIC Proceedings - (524-526) - ACLI to NAIC - Statement on Behalf of the American Council of Life Insurance to the NAIC (A) Committee's Manipulation, Lapsation, Dividend Practices and Annuity Disclosure Task Force - June 8, 1982
    • 1. The product commonly referred to as "universal life insurance" has aroused considerable attention and is being marketed to an increasing extent.
      • Under a universal life insurance policy, the insured has considerable flexibility with respect to the amount and timing of premium payments.
      • It is possible for the insured to skip premium payments and still have the policy continue in force, even until the point at which the policy expires or matures.
      • Under these circumstances, when is a policy to be considered as having lapsed for the purpose of the proposed disclosure system?
      • How about the situation where a premium is paid, but at a substantially lower level than the policyholder had been paying?
      • Should this be considered a partial lapse and, if so, how should the amount lapsed be measured?
    • 2. Another recent product is "adjustable life insurance."
      • The policyholder must pay premiums on the specified due dates but can request changes in the amount of the premium, the amount of insurance, or the plan of insurance.
      • The policy thus can be changed from a permanent insurance plan to a term plan, and vice versa.
    • How are such policies to be handled under the advisory committee's proposed system, which calls for a separation of the experience between permanent and term insurance?

Index Code : 1981-12 - 12p
To: NAIC Life Insurance (C3) Subcommittee
<From: American Academy of Actuaries>
Date : June 2, 1981
Length : 12 pages beginning on page 144
Concerning : Dividend principles and practices

Background : This statement was presented at a meeting of the Task Force on Manipulation, Lapsation, Dividend Practices and Annuity Disclosure of NAIC Life Insurance (C3) Subcommittee as a status report of the activities of the Committee on Dividend Principles and Practices.

This statement follows previous submissions on this subject to the NAIC (see statements 1979-14, 1960-18, and 1980-32) .