LIFE INSURANCE AND ANNUITIES (A) COMMITTEE
Sunday, April 7, 2019

3. Discussed Issues with AG 49 and IUL Policies

• Mr. Yanacheak said there have been several stories in the news lately about indexed universal life (IUL) policies. In particular, IUL policies that use indexed return multipliers were not around when AG 49 was developed.
• Mr. Yanacheak said there are key features in AG 49, such as maximum illustrated rates and limits on illustration of loans. that may not be working as intended with respect to these IUL policies.
• Mr. Boerner said the IUL Illustration (A) Subgroup under the Life Actuarial (A) Task Force is poised to study the effectiveness of AG 49 and is able to include this particular issue within its review.
• Mr. Regalbuto expressed support in having the Task
  Force look into the issue and said it is a matter of some urgency.
• The Life Insurance and Annuities (A) Committee asked for
  this issue to be included within the IUL Illustration (A) Subgroup’s work.
• Mr. Birnbaum said he is supportive of this inquiry and had sent an article to the attention of the Life Insurance and Annuities (A) Committee regarding the illustrations of unreasonable returns.
  • He said this work is another example of NAIC workstreams that involve consumer-facing disclosures.
  • He said he is proposing to the Executive (EX) Committee that an Executive (EX) Task Force be created on consumer information, education and disclosure.
  • He said there is a need for experts in consumer
    disclosure, in addition to subject matter experts (SMEs), to review all consumer-facing disclosures developed by the NAIC.

2009- , NAIC Proceedings