AG 49 is Coming- Here is the Latest Info


The NAIC has established new guidelines for indexed universal life insurance (IUL) carriers related to:

  1. The way each carrier determines their “Max Illustrated Rate” for IUL illustrations.
  2. The way each carrier sets their illustrated loan interest spread for cash flow scenarios within IUL illustrations.
  3. Disclosure requirements for illustrations reflecting the non-guaranteed nature and variability of the credited interest rate.


The changes to the way maximum illustrated rates are determined take effect on September 1, 2015. Changes to illustrations of cash flow scenarios and the additional disclosure requirements take effect on March 1, 2016.


These guidelines are intended to bring more consistency in illustrated rates and increase the client’s understanding of their IUL policy.

As a producer you will not experience much change due to the “Max Illustrated Rate” guideline. With most carriers, the long-standing approach toward illustrated rates aligns well with the new guidelines and the new illustrated rates will not be significantly different from today’s.

The changes to illustrations for cash flow scenarios will affect how you see the potential “spread” between the interest crediting rate and the loan interest rate on the illustration when using the variable loan rate option. This spread will be limited to 100 bps for all carriers. The additional disclosures will provide a second set of non-guaranteed policy value projections and an exhibit of year-by-year variability in credited interest rates that may be anticipated within the policy.


We will post updates to this blog with transition guidelines and additional information you may find helpful closer to the implementation dates.

About Jeffrey Berson

40 years in and around the industry has made Insurance a part of my DNA. I have had the pleasure of working with and for some of the greatest minds in our industry. My "Bersonal" View is an attempt to capture some of the best ideas, the best concepts and the best practices in a way that can lead to success for others. It will certainly be my point of view, so please...don't take it "Bersonal".
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