Insurance, Administration

Rule R590-95

Rule to Permit the Same Minimum Nonforfeiture Standards for Men and Women Insureds Under the 1980 CSO and 1980 CET Mortality Tables

Five-Year Notice of Review and Statement of Continuation

DAR File No.: 35641
Filed: 01/10/2012 09:51:48 AM

NOTICE OF REVIEW AND STATEMENT OF CONTINUATION

Concise explanation of the particular statutory provisions under which the rule is enacted and how these provisions authorize or require the rule:

Section 31A-2-201 gives the department general rulemaking authority. It allows the department to write rules to implement the provisions of Title 31A. Section 31A-22-408 allows a rule to be written to set the cash surrender values and paid-up nonforfeiture benefits provided by a plan and computed by a method consistent with the principles of the Standard Nonforfeiture Law for Life Insurance. The rule provides the same cash surrender values and paid-up nonforfeiture benefits to both men and women.

Summary of written comments received during and since the last five-year review of the rule from interested persons supporting or opposing the rule:

No written comments regarding this rule have been received by the department within the past five years.

Reasoned justification for continuation of the rule, including reasons why the agency disagrees with comments in opposition to the rule, if any:

This rule was adopted because of the U.S. Supreme Court case, Arizona Governing Committee v. Norris in 1983. The court ruled that the use of gender-based actuarial tables in an annuity for an employer's pension plan violates the federal Civil Rights Act of 1964. As a result the National Association of Insurance Commissioners (NAIC) created a regulation that recognizes gender-blended mortality tables nonforfeiture standards for men and women. Most states, including Utah, adopted the rule. It allows insurance companies issuing annuity contracts to employer-clients to comply with the Norris decision. Therefore, this rule should be continued.

The full text of this rule may be inspected, during regular business hours, at the Division of Administrative Rules, or at:

Direct questions regarding this rule to:

• Jilene Whitby at the above address, by phone at 801-538-3803, by FAX at 801-538-3829, or by Internet E-mail at jwhitby@utah.gov

Authorized by:

Jilene Whitby, Information Specialist

Effective:

01/10/2012