Sec. 103.4. Valuation of individual term life insurance reserves

(a) Scope.

This section applies to all individual term life insurance policies, whether directly written or assumed through reinsurance, issued on or after January 1, 2019.

(b) An insurer may elect to apply the minimum reserve standards in subdivision (c) of this section for policies issued on or after January 1, 2019 and prior to January 1, 2020, provided such standards are applied to all policies issued on or after the date elected.

(c) The minimum aggregate reserve, where the level of aggregation is defined by section 2.A of VM-20 of the valuation manual, for term life insurance policies issued on or after January 1, 2020 shall be the greater of:

(1) the sum of the greater of the cash surrender value and 70 percent of the minimum reserve calculated in accordance with the methodology and assumptions prescribed by Insurance Law section 4217(a) through (f), Part 98 (Insurance Regulation 147) of this Title, Part 100 (Insurance Regulation 179) of this Title, and any other applicable regulations, determined for each policy on a seriatim basis; and

(2) the minimum aggregate reserve calculated in accordance with the methodology and assumptions prescribed by the valuation manual prior to reflecting any reinsurance ceded.

(d) An insurer may submit a request to the superintendent to delay the implementation of the minimum valuation standards of subdivision (c) of this section, such that the minimum valuation standards shall be effective for policies issued on or after January 1, 2021, upon a demonstration of undue hardship, impracticability, or good cause, subject to the superintendent’s approval.