2019 Oregon Revised Statutes
Volume : 18 - Financial Institutions, Insurance
Chapter 733 - Accounting and Investments
Section 733.310 - Interest rates for determining minimum standard for valuation.

(a) All life insurance policies issued in a particular calendar year, on or after the operative date stated in ORS 743.215 for the Standard Nonforfeiture Law for Life Insurance;

(b) All individual annuity and pure endowment contracts issued in a particular calendar year on or after January 1, 1982;

(c) All annuities and pure endowments purchased in a particular calendar year on or after January 1, 1982, under group annuity and pure endowment contracts; and

(d) The net increase, if any, in a particular calendar year after January 1, 1982, in amounts held under guaranteed interest contracts.

(2) Calendar year statutory valuation interest rates shall be established as follows:

(a) Except as provided in paragraph (b) of this subsection, the calendar year statutory valuation interest rates, "I", shall be determined as follows and the results rounded to the nearer one-quarter of one percent:

(A) For life insurance:

I=0.03+W(R1−0.03)+W/2(R2−0.09)

(B) For single premium immediate annuities and for annuity benefits involving life contingencies arising from other annuities with cash settlement options and from guaranteed interest contracts with cash settlement options,

I=0.03+W(R−0.03)

where R1 is the lesser of R and 0.09, R2 is the greater of R and 0.09, R is the reference interest rate defined in this section and W is the weighting factor defined in this section.

(C) For other annuities with cash settlement options and guaranteed interest contracts with cash settlement options, valued on an issue year basis, except as stated in subparagraph (B) of this paragraph, the formula for life insurance stated in subparagraph (A) of this paragraph shall apply to annuities and guaranteed interest contracts with guarantee durations in excess of 10 years and the formula for single premium immediate annuities stated in subparagraph (B) of this paragraph shall apply to annuities and guaranteed interest contracts with guarantee duration of 10 years or less.

(D) For other annuities with no cash settlement options and for guaranteed interest contracts with no cash settlement options, the formula for single premium immediate annuities stated in subparagraph (B) of this paragraph shall apply.

(E) For other annuities with cash settlement options and guaranteed interest contracts with cash settlement options, valued on a change in fund basis, the formula for single premium immediate annuities stated in subparagraph (B) of this paragraph shall apply.

(b) If the calendar year statutory valuation interest rate for any life insurance policies issued in any calendar year determined without reference to this paragraph differs from the corresponding actual rate for similar policies issued in the immediately preceding calendar year by less than one-half of one percent, the calendar year statutory valuation interest rate for such life insurance policies shall be equal to the corresponding actual rate for the immediately preceding calendar year. For purposes of applying this paragraph, the calendar year statutory valuation interest rate for life insurance policies issued in a calendar year shall be determined for 1980, using the reference interest rate defined in 1979, and shall be determined for each subsequent calendar year regardless of the operative date of ORS 743.215 as part of the Standard Nonforfeiture Law for Life Insurance.

(3) Weighting factors shall be as follows:

(a) The weighting factors referred to in the formulas stated in subsection (2) of this section are given in the following tables:

(A) Weighting Factors for Life Insurance:

Guarantee

Duration Weighting

(Years) Factors

10 or less 0.50

More than 10, but less than 20 0.45

More than 20 0.35

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.

(B) 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 contracts with cash settlement options is 0.80.

(C) Weighting factors for other annuities and for guaranteed interest contracts, except as stated in subparagraph (B) of this paragraph, shall be as specified in the following tables (i), (ii) and (iii), according to the rules and definitions in the following tables (iv), (v) and (vi):

(i) For annuities and guaranteed interest contracts valued on an issue year basis:

Guarantee Weighting Factor

Duration for Plan Type

(Years) A B C

5 or less: 0.80 0.60 0.50

More than 5, but not more

than 10: 0.75 0.60 0.50

More than 10, but not more

than 20: 0.65 0.50 0.45

More than 20: 0.45 0.35 0.35

(ii) For annuities and guaranteed interest contracts valued on a change in fund basis, the factors shown in table (i) above increased by:

Plan Type