Filing Information Notices (FIN)

Articles II(11), IV(3) and (6), X(2), and XVI(2) of the Interstate Insurance Product Regulation Compact as adopted by Compacting States. 

Section 103 of the Operating Procedure for the Filing and Approval of Product Filings (“Product Filing Rule”).

All Uniform Standards for adjustable individual life insurance policies: Individual Flexible Premium Adjustable Life Insurance Policy Standards (IIPRC-L-09-I); Individual Joint Last to Die Survivorship Flexible Premium Adjustable Life Insurance Policy Standards (IIPRC-L-09-I-2); Individual Modified Single Premium Adjustable Life Insurance Policy Standards (IIPRC-L-09-I-1); and Individual Current Assumption Whole Life Insurance Policy Standards (IIPRC-L-07-I-5).

The purpose of this Filing Information Notice is to explain the documentation required in Compact filing submissions as of June 1, 2026 to address Guidance Note to Section 2 of VM-02 in the National Association of Insurance Commissioners (NAIC) Valuation Manual effective 01/01/2026 (Guidance Note), that for policies where the cash surrender value is based on multiple sets of guaranteed interest rates, expense charges, and/or mortality, each set of guarantees must comply with nonforfeiture requirements.

The Compact has Uniform Standards covering individual life insurance policies, including Uniform Standards for adjustable life insurance products, commonly referred to as universal life insurance (UL). The Guidance Note states that for policies where the cash surrender value is based on multiple sets of guaranteed interest rates, expense charges, and/or mortality, each set of guarantees must comply with nonforfeiture requirements. As the NAIC Life Actuarial (A) Task Force minutes from its discussion and adoption of the Guidance Note on May 8, 2025, reflect, the Guidance Note provides clarity to the existing nonforfeiture requirements for products with multiple sets of guarantees.

The Compact Office will apply this guidance to all UL products where the cash surrender value may be based on multiple sets of guarantees. The guidance clarifies that testing the set of guarantees (interest, expense charges, and/or mortality) for each accumulation option available for a product is necessary. An accumulation option includes, but is not limited to, accumulation value floors, cash value floors, fixed or guaranteed interest accounts, and index-linked accounts. The Scope provision of the Additional Standards for Index-Linked Crediting Benefit Features for Individual Adjustable Life Policies (IIPRC-L-08-LB-I) provides that these Uniform Standards are “in addition to the requirements of the applicable uniform policy standards,” and as such, compliance with minimum nonforfeiture requirements applies to index-linked accounts.

1. As of June 1, 2026, filings for new UL products must demonstrate nonforfeiture compliance consistent with the Guidance Note. 
    
2. As of June 1, 2026, filings that amend the interest, expense or mortality guarantees of previously approved UL products must demonstrate nonforfeiture compliance consistent with the Guidance Note. 
    
3. A filing that only adds or changes an index-linked account or another accumulation option of a previously approved UL product may provide documentation certifying the set of guarantees for the new or different index-linked account or accumulation option meets the minimum nonforfeiture requirements as described under Paragraph 5 below, without providing nonforfeiture demonstrations in the filing. 
    
4. The set of guarantees must be tested for each accumulation option. For each index-linked account if the guaranteed interest rate is lower than the guaranteed interest rate for all accumulation options excluding other index-linked accounts, the index-linked account guaranteed interest rate does not need to be tested. If allocation to any accumulation option is limited, a guaranteed interest rate no lower than the highest possible weighted average guaranteed interest rate under any permitted allocation scenario may be used.
    
5. Documentation that certifies nonforfeiture compliance for each set of guarantees shall include at a minimum.
    
   1. Nonforfeiture demonstrations for each set of guarantees unless subject to Paragraph 3 above;
       
   2. Description of each set of guarantees (interest, expense charges, and/or mortality) associated with each product;
       
   3. Description of the testing performed including all assumptions; and
       
   4. Actuarial certification that each set of guarantees is compliant with the nonforfeiture requirements.
       
6. When filing supporting documentation pursuant to these filing procedures, please note in accordance with Filing Information Notice 2017-1:
    
   1. For a SDU filing, new forms are not permitted on the Form Schedule.
       
   2. The supporting documentation can follow one of these options:
       
      1. A new and updated actuarial memorandum, and specification pages if needed; or
          
      2. A separate addendum to each actuarial memorandum for each specific product filing; or
          
      3. An addendum applicable to the actuarial memoranda in more than one product filing of the same type of insurance, if the products are of similar design or are multiple versions of a product.
          
   3. The actuarial memorandum or addendum must:
       
      1. Reference form number and SERFF Tracking Number for each product covered in the memorandum or addendum;
          
      2. Ensure the description includes each set of guarantees associated with each product;
          
      3. Link to the approved filing(s) and corresponding forms using the Associated Filings feature; and
          
      4. Identify the most recently approved memorandum for the product by SERFF Tracking Number, if different than the product filing referenced under item (i) in this subsection, and link such filing using the Associated Filings feature.

Purpose of Restatement: FIN 2025-2 is restated to eliminate applicability to variable adjustable life insurance (VUL) products and to provide further clarification regarding previously approved products and demonstration methodology.