• 2. A separate account is a design feature that is generally available to purchasers of whole life or universal life whereby the policyholder’s cash surrender value is supported by assets segregated from the general assets of the carrier.
  • Under such an arrangement, the policyholder neither owns the underlying separate account nor controls investment decisions (e.g., timing of investments or credit selection) in the underlying separate account that is created by the insurance carrier on its behalf. Nevertheless, the policyholder assumes all investment and price risk.  (p131/2)

2006 05 - Commercial Bank Examination Manual - Purchase and Risk Management of Life Insurance, Effective date November 2005 Section 4042.1, Interagency Statement on the Purchase and Risk, Management of Life Insurance - 318p