2014 Virginia Code
Title 38.2 - Insurance
§ 38.2-3134. (Repealed effective January 1, 2015) Weighting factors

The weighting factors referred to in the formulas in § 38.2-3133 are given in the following tables:

1. Weighting Factors for Life Insurance:

GuaranteeWeighting
DurationFactors
(Years)
10 or less.50
More than 10, but not more than 20.45
More than 20.35

For life insurance, the guarantee duration is the maximum number of years the life insurance can remain in force on a basis guaranteed in the policy or under options to convert to plans of life insurance with premium rates or nonforfeiture values or both that are guaranteed in the original policy.

2. Weighting factor for single premium immediate annuities and for annuity benefits involving life contingencies arising from other annuities with cash settlement options and guaranteed interest contract with cash settlement options:

.80

3. Weighting factors for other annuities and for guaranteed interest contracts, except as stated in subdivision 2 of this section, shall be as specified in tables a, b, and c below, according to the rules and definitions in subdivisions 4, 5 and 6 of this section:

a. For annuities and guaranteed interest contracts valued on an issue year basis:

GuaranteeWeighting Factor
DurationFor Plan Type
(Years)ABC
5 or less:.80.60.50
More than 5, but not more than 10:.75.60.50
More than 10, but not more than 20:.65.50.45
More than 20:.45.35.35

interest contracts valued on
a change in fund basis, the
factors shown in table a
increased by:.15 .25.05

interest contracts valued on
an issue year basis, other
than those with no cash
settlement options, that do
not guarantee interest on
considerations received more
than one year after issue or
purchase and for annuities
and guaranteed interest
contracts valued on a change
in fund basis that do not
guarantee interest rates on
considerations received more
than twelve months beyond the
valuation date, the factors
shown in table a or derived
in table b increased by:.05.05.05

4. For other annuities with cash settlement options and guaranteed interest contracts with cash settlement options, the guarantee duration is the number of years for which the contract guarantees interest rates in excess of the calendar year statutory valuation interest rates for life insurance policies with guarantee duration in excess of twenty years. For other annuities with no cash settlement options and for guaranteed interest contracts with no cash settlement options, the guarantee duration is the number of years from the date of issue or date of purchase to the date annuity benefits are scheduled to begin.

5. Plan type as used in the above tables is defined as follows:

Plan Type A: At any time policyholders may withdraw funds only (i) with an adjustment to reflect changes in interest rates or asset values since receipt of the funds by the insurer, (ii) without that adjustment but in installments over five years or more, (iii) as an immediate life annuity, or (iv) no withdrawal permitted.

Plan Type B: Before expiration of the interest rate guarantee, the policyholder may withdraw funds only (i) with an adjustment to reflect changes in interest rates or asset values since receipt of the funds by the insurer, (ii) without that adjustment but in installments over five years or more, or (iii) no withdrawal permitted. At the end of the interest rate guarantee, funds may be withdrawn without the adjustment in a single sum or in installments over less than five years.

Plan Type C: The policyholder may withdraw funds before expiration of the interest rate guarantee in a single sum or in installments over less than five years either (i) without adjustment to reflect changes in interest rate or asset values since receipt of the funds by the insurer, or (ii) subject only to a fixed surrender charge stipulated in the contract as a percentage of the fund.

6. An insurer may elect to value guaranteed interest contracts with cash settlement options and annuities with cash settlement options on either an issue-year basis or on a change-in-fund basis. Guaranteed interest contracts with no cash settlement options and other annuities with no cash settlement options must be valued on an issue-year basis. As used in §§ 38.2-3132 through 38.2-3136, an issue-year basis of valuation refers to a valuation basis under which the interest rate used to determine the minimum valuation standard for the entire duration of the annuity or guaranteed interest contract is the calendar year valuation interest rate for the year of issue or year of purchase of the annuity or guaranteed interest contract. As used in §§ 38.2-3132 through 38.2-3136, the change-in-fund basis of valuation refers to a valuation basis under which the interest rate used to determine the minimum valuation standard applicable to each change in the fund held under the annuity or guaranteed interest contract is the calendar year valuation interest rate for the year of the change in the fund.

Code 1950, § 38-394; 1952, c. 317, § 38.1-456; 1959, Ex. Sess., c. 43; 1962, c. 562; 1975, c. 215; 1979, c. 437; 1982, c. 227; 1986, c. 562.