§ 27-62-10. Annual certifications.
(a) The board of directors of each insurer shall appoint one or more illustration actuaries.
(b) The illustration actuary shall certify that the disciplined current scale used in
illustrations is in conformity with the actuarial standard of practice for compliance
with the NAIC model regulation on life insurance illustrations promulgated by the
actuarial standards board, and that the illustrated scales used in insurer-authorized
illustrations meet the requirements of this regulation.
(c) The illustration actuary shall:
(1) Be a member in good standing of the American Academy of Actuaries;
(2) Be familiar with the standard of practice regarding life insurance policy illustrations;
(3) Not have been found by the director of the department of business regulation, following
appropriate notice and hearing, to have:
(i) Violated any provision of, or any obligation imposed by, the insurance law or other
law in the course of his or her dealings as an illustration actuary;
(ii) Been found guilty of fraudulent or dishonest practices;
(iii) Demonstrated incompetence, lack of cooperation, or untrustworthiness to act as an
illustration actuary; or
(iv) Resigned or been removed as an illustration actuary within the past five (5) years
as a result of acts or omissions indicated in any adverse report on examination or
as a result of a failure to adhere to generally acceptable actuarial standards;
(4) Not fail to notify the insurance division of the department of business regulation
of any action taken by another state similar to that under subsection (c)(3) of this
section;
(5) Disclose in the annual certification whether, since the last certification, a currently
payable scale applicable for business issued within the previous five (5) years and
within the scope of the certification has been reduced for reasons other than changes
in the experience factors underlying the disciplined current scale. If non-guaranteed
elements illustrated for new policies are not consistent with those illustrated for
similar in force policies, this must be disclosed in the annual certification. If
non-guaranteed elements illustrated for both new and in force policies are not consistent
with the non-guaranteed elements actually being paid, charged or credited to the same
or similar forms, this must be disclosed in the annual certification; and
(6) Disclose in the annual certification the method used to allocate overhead expenses
for all illustrations:
(i) Fully allocated expenses;
(ii) Marginal expenses; or
(iii) A generally recognized expense table based on fully allocated expenses representing
a significant portion of insurance companies and approved by the commissioner.
(d)(1) The illustration actuary shall file a certification with the board and with the insurance
division of the department of business regulation:
(i) Annually for all policy forms for which illustrations are used; and
(ii) Before a new policy form is illustrated.
(2) If an error in a previous certification is discovered, the illustration actuary shall
promptly notify the board of directors of the insurer and the insurance division of
the department of business regulation.
(e) If an illustration actuary is unable to certify the scale for any policy form illustration
the insurer intends to use, the actuary shall notify the board of directors of the
insurer and the commissioner promptly of his or her inability to certify.
(f) A responsible officer of the insurer, other than the illustration actuary, shall annually
certify:
(1) That the illustration formats meet the requirements of this regulation and that the
scales used in insurer-authorized illustrations are those scales certified by the
illustration actuary; and
(2) That the company has provided its agents with information about the expense allocation
method used by the company in its illustrations and disclosed as required in subsection
(c)(6).
(g) The annual certifications shall be provided to the insurance division of the department
of business regulation by a date determined by the insurer.
(h) If an insurer changes the illustration actuary responsible for all or a portion of
the company's policy forms, the insurer shall promptly notify the insurance division
of the department of business regulation of that fact and disclose the reason for
the change.