§ 26-16-404 — Minimum nonforfeiture amounts upon which certain minimum values are to be based

Wyoming § 26-16-404

• Jurisdiction: Wyoming
• Title 26: Insurance Code
• Ch. 16: LIFE INSURANCE AND ANNUITY CONTRACTS

Text

(a) The minimum values as specified in W.S. 26-16-405
through 26-16-409 of any paid-up annuity, cash surrender or
death benefits available under an annuity contract shall be
based upon minimum nonforfeiture amounts as defined in
subsections (b) through (f) of this section.
(b) The minimum nonforfeiture amounts shall be governed by
the following:
(i) The minimum nonforfeiture amount at any time at
or prior to the commencement of any annuity payments shall be
equal to an accumulation up to that time at rates of interest as
provided in subsection (e) of this section of the net
considerations paid prior to that time decreased by the sum of
any prior withdrawals from or partial surrenders of the contract
accumulated at rates of interest provided in subsection (e) of
this section, an annual contract charge of fifty dollars
($50.00), accumulated at rates of interest as provided in
subsection (e) of this section, and any premium tax paid by the
company for the contract, accumulated at rates of interest as
provided in subsection (e) of this section, and the amount of
any indebtedness to the company on the contract, including
interest due and accrued. The net considerations for a given
contract year used to define the minimum nonforfeiture amount
shall be an amount equal to eighty-seven and one-half percent
(87 ½%) of the gross considerations credited to the contract
during that contract year;
(ii) For contracts issued on or after July 1, 2003,
and before July 1, 2007, the provisions of paragraph (i) of this
subsection apply, except that the minimum nonforfeiture amount
shall be based upon a rate of interest of one and one-half
percent (1.5%) per annum.
(c) Repealed By Laws 2006, Chapter 6, § 2.
(d) Repealed By Laws 2006, Chapter 6, § 2.
(e) The interest rate used in determining minimum
nonforfeiture amounts shall be an annual rate of interest
determined as follows:
(i) The lesser of three percent (3%) per annum and
the following, which shall be specified in the contract if the
interest rate will be reset:
(A) The five (5) year constant maturity treasury
rate reported by the federal reserve as of a date, or average
over a period, rounded to the nearest one-twentieth of one
percent (.05%), specified in the contract no longer than fifteen
(15) months prior to the contract issue date or redetermination
date under paragraph (iii) of this subsection;
(B) Reduced by one hundred twenty-five (125)
basis points.
(ii) Notwithstanding paragraph (i) of this
subsection, the resulting interest rate shall not be less than
fifteen one-hundredths of one percent (0.15%);
(iii) The interest rate shall apply for an initial
period and may be redetermined for additional periods. The
redetermination date, basis and period, if any, shall be stated
in the contract. The basis is the date or average over a
specified period that produces the value of the five (5) year
constant maturity treasury rate to be used at each
redetermination date.
(f) During the period or term that a contract provides
substantive participation in an equity indexed benefit, it may
increase the reduction described in subparagraph (e)(i)(B) of
this section by up to an additional one hundred (100) basis
points to reflect the value of the equity index benefit. The
present value at the contract issue date, and at each
redetermination date thereafter, of the additional reduction
shall not exceed the market value of the benefit. The
commissioner may require a demonstration that the present value
of the additional reduction does not exceed the market value of
the benefit. Lacking such a demonstration that is acceptable to
the commissioner, the commissioner may disallow or limit the
additional reduction.
(g) The commissioner may adopt rules to implement the
provisions of subsection (f) of this section and to provide for
further adjustments to the calculation of minimum nonforfeiture
amounts for contracts that provide substantive participation in
an equity index benefit and for other contracts that the
commissioner determines are justified.