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A BILL TO BE ENTITLED
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AN ACT
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relating to the nonforfeiture requirements of certain life |
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insurance policies. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Subchapter A, Chapter 1105, Insurance Code, is |
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amended by adding Section 1105.0015 to read as follows: |
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Sec. 1105.0015. DEFINITION. In this chapter, "operative |
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date of the valuation manual" means the date, if any, on which the |
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valuation manual described by Chapter 425 becomes operative as |
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provided by that chapter. |
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SECTION 2. Section 1105.055, Insurance Code, is amended by |
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amending Subsections (h) and (i) and adding Subsections (j), (k), |
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(l), and (m) to read as follows: |
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(h) For a policy issued before the operative date of the |
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valuation manual, any [Any] ordinary mortality table adopted after |
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1980 by the National Association of Insurance Commissioners that is |
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approved by rules adopted by the commissioner for use in |
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determining the minimum nonforfeiture standard may be substituted |
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for: |
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(1) the Commissioners 1980 Standard Ordinary |
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Mortality Table with or without Ten-Year Select Mortality Factors; |
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or |
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(2) the Commissioners 1980 Extended Term Insurance |
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Table. |
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(i) For a policy issued before the operative date of the |
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valuation manual, any [Any] industrial mortality table adopted |
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after 1980 by the National Association of Insurance Commissioners |
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that is approved by rules adopted by the commissioner for use in |
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determining the minimum nonforfeiture standard may be substituted |
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for: |
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(1) the Commissioners 1961 Standard Industrial |
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Mortality Table; or |
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(2) the Commissioners 1961 Industrial Extended Term |
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Insurance Table. |
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(j) Except as provided by Subsection (k), for a policy |
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described by Subsection (h), on or after the operative date of the |
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valuation manual, the valuation manual must provide the |
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commissioners' standard ordinary mortality table for use in |
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determining the minimum nonforfeiture standard that may be |
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substituted for: |
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(1) the Commissioners 1980 Standard Ordinary |
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Mortality Table with or without Ten-Year Mortality Factors; or |
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(2) the Commissioners 1980 Extended Term Insurance |
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Table. |
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(k) If the commissioner by rule adopts a commissioners' |
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standard ordinary mortality table adopted by the National |
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Association of Insurance Commissioners for use in determining the |
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minimum nonforfeiture standard for policies issued on or after the |
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operative date of the valuation manual, the minimum nonforfeiture |
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standard determined in accordance with that table supersedes the |
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standard provided by the valuation manual. |
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(l) Except as provided by Subsection (m), for a policy |
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described by Subsection (i), on or after the operative date of the |
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valuation manual, the valuation manual must include the |
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commissioners' standard industrial mortality table for use in |
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determining the minimum nonforfeiture standard that may be |
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substituted for: |
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(1) the 1961 Standard Industrial Mortality Table; or |
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(2) the Commissioners 1961 Industrial Extended Term |
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Insurance Table. |
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(m) If the commissioner by rule adopts a commissioners' |
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standard industrial mortality table adopted by the National |
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Association of Insurance Commissioners for use in determining the |
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minimum nonforfeiture standard for policies issued on or after the |
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operative date of the valuation manual, the minimum nonforfeiture |
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standard determined in accordance with that table supersedes the |
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standard provided by the valuation manual. |
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SECTION 3. Section 1105.056, Insurance Code, is amended to |
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read as follows: |
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Sec. 1105.056. NONFORFEITURE INTEREST RATE. (a) For a |
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policy issued before the operative date of the valuation manual, |
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the [The] annual nonforfeiture interest rate for a policy issued in |
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a particular calendar year is equal to 125 percent of the calendar |
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year statutory valuation interest rate for that policy as defined |
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by Subchapter B, Chapter 425, rounded to the nearest one-fourth of |
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one percent. |
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(b) For a policy issued on or after the operative date of the |
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valuation manual, the nonforfeiture per year for any policy issued |
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in a particular calendar year is provided by the valuation manual. |
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SECTION 4. The commissioner of insurance may not implement |
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this Act before the operative date of the valuation manual |
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described by Section 1105.0015, Insurance Code, as added by this |
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Act. |
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SECTION 5. This Act takes effect only if an Act of the 83rd |
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Legislature, Regular Session, 2013, that amends Chapter 425, |
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Insurance Code, to authorize the commissioner of insurance to adopt |
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a standard valuation manual and provide an operative date for that |
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manual is enacted and becomes law. If an Act of the 83rd |
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Legislature, Regular Session, 2013, amending Chapter 425, |
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Insurance Code, to authorize the commissioner of insurance to adopt |
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a standard valuation manual and provide an operative date for that |
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manual does not become law, this Act has no effect. |
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SECTION 6. This Act takes effect January 1, 2014. |