26-16-210. Determination of specified life insurance plan premiums and benefits.
(a) For any life insurance plan which provides for future premium determination, the amounts of which are to be determined by the insurer based on the then estimates of future experience, or for any life insurance plan which is of such a nature that minimum values cannot be determined by the methods described in W.S. 26-16-202 through 26-16-209, the commissioner shall be satisfied that:
(i) The benefits provided under the plan are substantially as favorable to policyholders and insureds as the minimum benefits otherwise required by W.S. 26-16-202 through 26-16-209;
(ii) The benefits and the pattern of premiums of that plan are not such as to mislead prospective policyholders or insureds.
(b) The cash surrender values and paid-up nonforfeiture benefits provided by the plan shall not be less than the minimum values and benefits required for the plan computed by a method consistent with the principles of this article for life insurance, as determined by regulations the commissioner promulgates. (c)(i) This subsection, in addition to all other applicable subsections of this section, applies to all policies issued on or after January 1, 1986. Any cash surrender value available under the policy in the event of default in a premium payment due on any policy anniversary shall be in an amount which does not differ by more than two-tenths of one percent (.2%) of either the amount of insurance, if the insurance is uniform in amount, or the average amount of insurance at the beginning of each of the first ten (10) policy years, from the sum of (A) the greater of zero and the basic cash value as specified in this subsection and (B) the present value of any existing paid-up additions less the amount of any indebtedness to the insurer under the policy;
(ii) The basic cash value shall be equal to the present value, on such anniversary, of the future guaranteed benefits which would have been provided for by the policy, excluding any existing paid-up additions and before deduction of any indebtedness to the insurer, if there had been no default, less the then present value of the nonforfeiture factors, as specified in paragraph (iii) of this subsection, corresponding to premiums which would have fallen due on and after such anniversary. However, the effects on the basic cash value of supplemental life insurance or annuity benefits or of family coverage, as described in W.S. 26-16-203 or 26-16-207, whichever is applicable, shall be the same as are the effects specified in W.S. 26-16-203 or 26-16-207, whichever is applicable on the cash surrender values defined in that subsection;
(iii) The nonforfeiture factor for each policy year shall be an amount equal to a percentage of the adjusted premium for the policy year, as defined in W.S. 26-16-205, 26-16-206 and 26-16-207 or in W.S. 26-16-209, whichever is applicable. Except as is required by subparagraph (A) of this paragraph, such percentage:
(A) Must be the same percentage for each policy year between the second policy anniversary and the later of (1) the fifth policy anniversary and (2) the first policy anniversary at which there is available under the policy a cash surrender value in an amount, before including any paid-up additions and before deducting any indebtedness, of at least two-tenths of one percent (.2%) of either the amount of insurance, if the insurance be uniform in amount, or the average amount of insurance at the beginning of each of the first ten (10) policy years; and
(B) Must be such that no percentage after the later of the two (2) policy anniversaries specified in subparagraph (A) of this paragraph may apply to fewer than five (5) consecutive policy years.
(iv) No basic cash value may be less than the value which would be obtained if the adjusted premiums for the policy, as defined in W.S. 26-16-205, 26-16-206 and 26-16-207 or in W.S. 26-16-209, whichever is applicable, were substituted for the nonforfeiture factors in the calculation of the basic cash value;
(v) All adjusted premiums and present values referred to in this subsection, for a particular policy, shall be calculated on the same mortality and interest bases as are used in demonstrating the policy's compliance with the other subsections of this section. The cash surrender values referred to in this subsection shall include any endowment benefits provided for by the policy;
(vi) Any cash surrender value available other than in the event of default in a premium payment due on a policy anniversary, and the amount of any paid-up nonforfeiture benefit available under the policy in the event of default in a premium payment shall be determined in manners consistent with the manners specified for determining the analogous minimum amounts in W.S. 26-16-202, 26-16-203, 26-16-204, 26-16-209, and 26-16-211. The amounts of any cash surrender values and of any paid-up nonforfeiture benefits granted in connection with additional benefits such as those listed as paragraphs (i) through (vi) of this subsection shall conform with the principals of this section.
nonforfeiture benefits for premium default other than on policy anniversary.
(a) Any cash surrender value and any paid-up nonforfeiture benefit, available under the policy in case of default in a premium payment due at any time other than on the policy anniversary, shall be calculated with allowance for the lapse of time and the payment of fractional premiums beyond the last preceding policy anniversary. All values referred to in W.S. 26-16-203(b) through 26-16-209 may be calculated upon the assumption that any death benefit is payable at the end of the policy year of death. The net value of any paid-up additions, other than paid-up term additions, shall not be less than the amounts used to provide the additions. Notwithstanding W.S. 26-16-203(b), the following additional benefits payable shall be disregarded in ascertaining cash surrender values and nonforfeiture benefits required by this article and are not required to be included in any paid-up nonforfeiture benefits:
(i) In case of death or dismemberment by accident or accidental means;
(ii) In case of total and permanent disability;
(iii) As reversionary annuity or deferred reversionary annuity benefits;
(iv) As term insurance benefits provided by a rider or supplemental policy provision to which, if issued as a separate policy, this section would not apply;
(v) As term insurance on the life of a child provided in a policy on the life of a parent of the child, if the term insurance expires before the child's age is twenty-six (26), is uniform in amount after the child's age is one (1) and is not paid-up because of the death of a parent of the child; and
(vi) As other policy benefits additional to life insurance and endowment benefits, and premiums for all the additional benefits.
(a) This article does not apply to any:
(i) Reinsurance;
(ii) Group insurance;
(iii) Pure endowment;
(iv) Annuity or reversionary annuity contract;
(v) Term policy of uniform amount which provides no guaranteed nonforfeiture or endowment benefits, or renewal thereof, of twenty (20) years or less expiring before age seventy-one (71), for which uniform premiums are payable during the entire term of the policy;
(vi) Term policy of decreasing amount which provides no guaranteed nonforfeiture or endowment benefits and on which each adjusted premium, calculated as specified in W.S. 26-16-205 through 26-16-209, is less than the adjusted premium so calculated, on a term policy of uniform amount, or renewal thereof, which provides no guaranteed nonforfeiture or endowment benefits, issued at the same age, for the same initial amount of insurance, and for a term of twenty (20) years or less expiring before age seventy-one (71), for which uniform premiums are payable during the entire term of the policy;
(vii) Policy which provides no guaranteed nonforfeiture or endowment benefits and for which no cash surrender value or present value of paid-up nonforfeiture benefit at the beginning of the policy year and calculated as specified in W.S. 26-16-203(b) through 26-16-209, exceed two and one-half percent (2 1/2%) of the amount of insurance at the beginning of the policy year. For purposes of paragraph (vi) of this subsection and this paragraph, the age at expiration of a joint term life insurance policy is the age at expiration of the oldest life; or
(viii) Policy which is delivered outside this state through an agent or other representative of the insurer issuing the policy.
26-16-301. Nonforfeiture benefits on old policies.
(a) In the case of policies referred to in W.S. 26-16-102 and issued prior to the operative date of article 2 of this chapter, there shall be a provision which, in case of default in premium payments after premiums are paid for three (3) years, shall secure to the policy owner, as a nonforfeiture benefit, a stipulated form of insurance, the net value of which is at least equal to the minimum life insurance reserve at the date of the default on the policy and on any dividend addition thereto, as required by article 2 of chapter 6 of this code, less a sum not more than two and one-half percent (2 1/2%) of the amount insured by the policy and of any existing dividend additions thereto, and less any existing indebtedness to the insurer on or secured by the policy.
(b) The net value specified in subsection (a) of this section shall be determined on the basis of a mortality table and rate of interest stated in the policy and acceptable for the valuation of the policy pursuant to the standard valuation law, except that if the mortality table is a more modern table than the American experience table of mortality, a mortality rate not more than one hundred thirty percent (130%) of the mortality rate according to the more modern table may be used in calculating any extended insurance, with accompanying pure endowment, if any, offered as a nonforfeiture benefit. If the mortality table used as the basis of determining the net value is the commissioners' 1958 standard ordinary mortality table, the mortality rates to be assumed in calculating any extended insurance, with accompanying pure endowment, if any, shall not be more than those shown in the commissioners' 1958 extended term insurance table.
(c) The provision specified in subsection (a) of this section shall:
(i) Stipulate that the policy may be surrendered to the insurer at its home office within one (1) month from date of default, for a specified cash value equal to the sum which would otherwise be available for the purchase of insurance as specified in subsection (a) of this section, and may stipulate that the insurer may defer payment for not more than six (6) months after the application therefor is made;
(ii) Contain a table showing the options available under the policy each year upon default in premium payments during the first twenty (20) years of the policy, or during the term of the policy whichever is shorter;
(iii) Not be required in term insurances of twenty (20) years or less or in industrial life insurance policies.
(a) This article does not apply to any:
(i) Reinsurance;
(ii) Group annuity purchased under a retirement plan or plan of deferred compensation established or maintained by an employer, an employee organization, or both, other than a plan providing individual retirement accounts or annuities under Section 408 of the Internal Revenue Code;
(iii) Premium deposit fund;
(iv) Variable annuity;
(v) Investment annuity;
(vi) Immediate annuity;
(vii) Deferred annuity contract after annuity payments have commenced;
(viii) Reversionary annuity; or
(ix) Contract which is delivered outside this state through an agent or other representative of the company issuing the contract.
(a) In the case of contracts issued on or after the operative date of this article as defined in W.S. 26-16-411, no annuity contract, except as stated in W.S. 26-16-402, shall be delivered or issued for delivery in this state unless it contains in substance the following provisions, or corresponding provisions which the commissioner determines are at least as favorable to the contract holder, upon cessation of payment of considerations under the contract or upon the written request of the contract owner:
(i) The company shall grant a paid-up annuity benefit on a plan stipulated in the contract of a value as is specified in W.S. 26-16-405 through 26-16-409;
(ii) If a contract provides for a lump sum settlement at maturity, or at any other time, that upon surrender of the contract at or prior to the commencement of any annuity payments, the company shall pay instead of any paid-up annuity benefit a cash surrender benefit in an amount as is specified in W.S. 26-16-405, 26-16-406, 26-16-408 and 26-16-409, provided the company may reserve the right to defer the payment of the cash surrender benefit for a period not to exceed six (6) months after demand therefore with surrender of the contract and after making written request and receiving the written approval of the commissioner. The request shall address the necessity and equitability to all policyholders of the deferral;
(iii) A statement of the mortality table and interest rates used in calculating any minimum paid-up annuity, cash surrender or death benefits that are guaranteed under the contract, together with sufficient information to determine the amounts of those benefits;
(iv) A statement that any paid-up annuity, cash surrender or death benefits available under the contract are not less than the minimum benefits required by any statute of the state in which the contract is delivered and an explanation of the manner in which the benefits are altered by the existence of any additional amounts the company credits to the contract, any indebtedness to the company on the contract or any prior withdrawals from or partial surrenders of the contract;
(v) Any contract which does not provide cash surrender benefits or does not provide death benefits at least equal to the minimum nonforfeiture amount prior to the commencement of any annuity payments shall include a statement in a prominent place in the contract that those benefits are not provided;
(vi) Notwithstanding the requirements of this section, any deferred annuity contract may provide that if no considerations are received under a contract for a period of two (2) full years and the portion of the paid-up annuity benefit at maturity on the plan stipulated in the contract arising from considerations paid prior to the period would be less than twenty dollars ($20.00) monthly, the company, at its option, may terminate the contract by payment in cash of the then present value of the portion of the paid-up annuity benefit, calculated on the basis of the mortality table and interest rate specified in the contract for determining the paid-up annuity benefit, and by that payment is relieved of any further obligation under the contract.
26-16-404. Minimum nonforfeiture amounts upon which certain minimum values are to be based.
(a) The minimum values as specified in W.S. 26-16-405 through 26-16-409 of any paid-up annuity, cash surrender or death benefits available under an annuity contract shall be based upon minimum nonforfeiture amounts as defined in subsections (b) through (f) of this section.
(b) The minimum nonforfeiture amounts shall be governed by the following:
(i) The minimum nonforfeiture amount at any time at or prior to the commencement of any annuity payments shall be equal to an accumulation up to that time at rates of interest as provided in subsection (e) of this section of the net considerations paid prior to that time decreased by the sum of any prior withdrawals from or partial surrenders of the contract accumulated at rates of interest provided in subsection (e) of this section, an annual contract charge of fifty dollars ($50.00), accumulated at rates of interest as provided in subsection (e) of this section, and any premium tax paid by the company for the contract, accumulated at rates of interest as provided in subsection (e) of this section, and the amount of any indebtedness to the company on the contract, including interest due and accrued. The net considerations for a given contract year used to define the minimum nonforfeiture amount shall be an amount equal to eighty-seven and one-half percent (87 ½%) of the gross considerations credited to the contract during that contract year;
(ii) For contracts issued on or after July 1, 2003, and before July 1, 2007, the provisions of paragraph (i) of this subsection apply, except that the minimum nonforfeiture amount shall be based upon a rate of interest of one and one-half percent (1.5%) per annum.
(c) Repealed By Laws 2006, Chapter 6, § 2.
(d) Repealed By Laws 2006, Chapter 6, § 2.
(e) The interest rate used in determining minimum nonforfeiture amounts shall be an annual rate of interest determined as follows:
(i) The lesser of three percent (3%) per annum and the following, which shall be specified in the contract if the interest rate will be reset:
(A) The five (5) year constant maturity treasury rate reported by the federal reserve as of a date, or average over a period, rounded to the nearest one-twentieth of one percent (.05%), specified in the contract no longer than fifteen (15) months prior to the contract issue date or redetermination date under paragraph (iii) of this subsection;
(B) Reduced by one hundred twenty-five (125) basis points.
(ii) Notwithstanding paragraph (i) of this subsection, the resulting interest rate shall not be less than fifteen one-hundredths of one percent (0.15%);
(iii) The interest rate shall apply for an initial period and may be redetermined for additional periods. The redetermination date, basis and period, if any, shall be stated in the contract. The basis is the date or average over a specified period that produces the value of the five (5) year constant maturity treasury rate to be used at each redetermination date.
(f) During the period or term that a contract provides substantive participation in an equity indexed benefit, it may increase the reduction described in subparagraph (e)(i)(B) of this section by up to an additional one hundred (100) basis points to reflect the value of the equity index benefit. The present value at the contract issue date, and at each redetermination date thereafter, of the additional reduction shall not exceed the market value of the benefit. The commissioner may require a demonstration that the present value of the additional reduction does not exceed the market value of the benefit. Lacking such a demonstration that is acceptable to the commissioner, the commissioner may disallow or limit the additional reduction.
(g) The commissioner may adopt rules to implement the provisions of subsection (f) of this section and to provide for further adjustments to the calculation of minimum nonforfeiture amounts for contracts that provide substantive participation in an equity index benefit and for other contracts that the commissioner determines are justified.
26-16-405. Present value of paid-up annuity benefits.
Any paid-up annuity benefit available under a contract shall be such that its present value on the date annuity payments are to commence is at least equal to the minimum nonforfeiture amount on that date. The present value shall be computed using the mortality table and the interest rate specified in the contract for determining the minimum paid-up annuity benefits guaranteed in the contract.
26-16-406. Calculating cash surrender benefits available prior to contract maturity.
(a) For contracts which provide cash surrender benefits, cash surrender benefits available prior to maturity shall not be less than an amount determined as follows:
(i) Determine the present value as of the date of surrender of that portion of the maturity value of the paid-up annuity benefit which would be provided under the contract at maturity, arising from considerations paid prior to the time of cash surrender;
(ii) The amount determined in paragraph (i) of this subsection shall be reduced by the amount appropriate to reflect any prior withdrawals from or partial surrenders of the contract with the present value being calculated on the basis of an interest rate not more than one percent (1%) higher than the interest rate specified in the contract for accumulating the net considerations to determine the maturity value;
(iii) The amount determined in paragraph (ii) of this subsection shall be decreased by the amount of any indebtedness to the company on the contract, including interest due and accrued; and
(iv) The amount determined in paragraph (iii) of this subsection shall be increased by any existing additional amounts credited by the company to the contract. In no case shall any cash surrender benefit be less than the minimum nonforfeiture amount at that time. The death benefit under the contracts shall be at least equal to the cash surrender benefit.
26-16-407. Minimum paid-up annuity benefit available as a nonforfeiture option.
For contracts which do not provide cash surrender benefits, the present value of any paid-up annuity benefit available as a nonforfeiture option at any time prior to maturity shall not be less than the present value of that portion of the maturity value of the paid-up annuity benefit provided under the contract arising from considerations paid prior to the time the contract is surrendered in exchange for, or changed to, a deferred paid-up annuity, with the present value being calculated for the period prior to the maturity date on the basis of the interest rate specified in the contract for accumulating the net considerations to determine the maturity value, and increased by any existing additional amounts credited by the company to the contract. For contracts which do not provide any death benefits prior to the commencement of any annuity payments, the present values shall be calculated on the basis of the interest rate and the mortality table specified in the contract for determining the maturity value of the paid-up annuity benefit. The present value of a paid-up annuity benefit shall not be less than the minimum nonforfeiture amount at that time.
For the purpose of determining the benefits calculated under W.S. 26-16-406 and 26-16-407 in the case of annuity contracts under which an election may be made to have annuity payments commence at optional maturity dates, the maturity date is the latest date for which election is permitted by the contract, but not later than the anniversary of the contract immediately following the annuitant's seventieth birthday or the tenth anniversary of the contract, whichever is later.
26-16-409. Calculating benefits under contracts with fixed schedule considerations.
Any paid-up annuity, cash surrender or death benefits available at any time, other than on the contract anniversary, under any contract with fixed scheduled considerations, shall be calculated with allowance for the lapse of time and the payment of any scheduled considerations beyond the beginning of the contract year in which cessation of payment of considerations under the contract occurs.
26-16-410. Calculating minimum annuity and life insurance
nonforfeiture benefits when included by rider or supplemental contract provision. For any contract which provides therein, by rider or supplemental contract provision, both annuity benefits and life insurance benefits that exceed the greater of cash surrender benefits or a return of the gross considerations with interest, the minimum nonforfeiture benefits shall be equal to the sum of the minimum nonforfeiture benefits for the annuity portion and the minimum nonforfeiture benefits, if any, for the life insurance portion computed as if each portion were a separate contract. Notwithstanding W.S. 26-16-405 through 26-16-409 additional benefits payable in case of total and permanent disability, as reversionary annuity or deferred reversionary annuity benefits or as other policy benefits additional to life insurance, endowment and annuity benefits, and considerations for all those additional benefits, shall be disregarded in ascertaining the minimum nonforfeiture amounts, paid-up annuity, cash surrender and death benefits required by this article. The inclusion of the additional benefits is not required in any paid-up benefits, unless the additional benefits separately would require minimum nonforfeiture amounts, paid-up annuity, cash surrender and death benefits.
(a) After May 20, 1981, any company may file with the commissioner a written notice of its election to comply with this article after a specified date before May 20, 1983. After filing the notice, then upon the specified date, which is the operative date of this article for that company, this article is operative with respect to annuity contracts thereafter issued by that company. If a company does not make an election, the operative date of this article for that company is May 20, 1983.
(b) Beginning July 1, 2006, any company may elect to apply the provisions of this article on a contract form by contract form basis to all annuity contracts thereafter issued.
(c) On or after July 1, 2007, this article is operative with respect to all annuity contracts thereafter issued.
26-16-501. Incontestability and limitation of liability after reinstatement.
(a) A reinstated life insurance policy or annuity contract may be contested because of fraud or misrepresentation of facts material to the reinstatement only for the same period following reinstatement and with the same conditions and exceptions as the policy provides for contestability after original issuance.
(b) If any life insurance policy or annuity contract is reinstated, the reinstated policy or contract may exclude or restrict liability to the same extent that the liability could have been or was excluded or restricted when the policy or contract was originally issued. The exclusion or restriction is effective from the date of reinstatement.
26-16-502. Allocation to separate accounts to provide for
life insurance or annuities; regulation of variable contracts.
(a) A domestic life insurer may establish one (1) or more separate accounts and may allocate to those accounts amounts, including without limitation proceeds applied under optional modes of settlement or under dividend options, to provide for life insurance or annuities and benefits incidental thereto, payable in fixed or variable amounts or both, subject to the following:
(i) The income and any gains and losses from assets allocated to a separate account shall be credited to or charged against the account, without regard to the insurer's other income, gains or losses;
(ii) Except as may be provided with respect to reserves for guaranteed benefits and funds referred to in paragraph (iii) of this subsection, amounts allocated to any separate account and accumulations thereon may be invested and reinvested without regard to any requirements or limitations prescribed by the laws of this state governing the investments of life insurance companies, and the investments in the separate accounts shall not be considered in applying the investment limitations otherwise applicable to the insurer's investments;
(iii) Except with the commissioner's approval and under conditions he prescribes as to investments and other matters, which conditions shall recognize the guaranteed nature of the benefits provided, reserves for benefits guaranteed as to dollar amount and duration and funds guaranteed as to principal amount or stated rate of interest shall not be maintained in a separate account;
(iv) Unless the commissioner otherwise approves:
(A) Assets allocated to a separate account shall be valued at their market value on the date of valuation, or if there is no readily available market, then as provided under the terms of the contract or the rules or other written agreement applicable to the separate account;
(B) The portion, if any, of the assets of the separate account which are equal to the insurer's reserve liability with regard to the guaranteed benefits and funds referred to in paragraph (iii) of this subsection shall be valued in accordance with the rules otherwise applicable to the insurer's assets.
(v) The insurer shall own amounts allocated to a separate account under this section and shall not be nor hold itself out to be a trustee with respect to those amounts;
(vi) If and to the extent provided under the applicable contracts, that portion of the assets of any separate account equal to the reserves and other contract liabilities with respect to the account are not chargeable with liabilities arising out of any other business the insurer conducts;
(vii) No insurer shall sell, exchange or otherwise transfer its assets between any of its separate accounts, or between any other investment account and one (1) or more of its separate accounts unless:
(A) In case of a transfer into a separate account, the transfer is made solely to establish the account or to support the operation of the contracts with respect to the separate account to which the transfer is made;
(B) The transfer, whether into or from a separate account, is made by a transfer of cash or by a transfer of securities having a readily determinable market value; and
(C) The commissioner approves the transfer of securities, provided the commissioner may approve other transfers among the accounts if, in his opinion, the transfers are not inequitable.
(viii) To the extent deemed necessary to comply with any applicable federal or state laws, the insurer, with respect to any separate account, including without limitation any separate account which is a management investment company or a unit investment trust, may provide for persons having an interest therein appropriate voting and other rights and special procedures for the conduct of the business of the account, including special rights and procedures relating to investment policy, investment advisory services, selection of independent public accountants and the selection of a committee, the members of which need not be otherwise affiliated with the insurer, to manage the business of the account.
(b) Any contract providing benefits payable in variable amounts delivered or issued for delivery in this state shall contain a statement of the essential features of the procedures the insurer is to follow in determining the dollar amount of the variable benefits. The contract under which the benefits vary to reflect investment experience, including a group contract and any certificate in evidence of variable benefits issued thereunder, shall state that the dollar amount will vary and shall contain on its first page a statement to the effect that the benefits thereunder are on a variable basis.
(c) No insurer shall deliver or issue for delivery within this state variable contracts unless it is licensed to do a life insurance or annuity business in this state, and the commissioner is satisfied that its condition or method of operation in connection with the issuance of the contracts will not render its operation hazardous to the public or its policyholders in this state. In this connection, the commissioner shall consider among other things:
(i) The insurer's history and financial condition;
(ii) The character, responsibility and fitness of the insurer's officers and directors; and
(iii) The law and regulation under which the insurer is authorized in the state of domicile to issue variable contracts. The state of entry of an alien insurer is its place of domicile for this purpose. If the insurer is a subsidiary of an admitted life insurer, or affiliated with that insurer through common management or ownership, it may be deemed by the commissioner to have met the provisions of this subsection if either it or the parent or the affiliated insurer meets the requirements thereof.
(d) Notwithstanding any other provision of law, the commissioner has sole authority to:
(i) Regulate the issuance and sale of variable contracts; and
(ii) Issue reasonable rules and regulations appropriate to carry out the purposes of this section.
(e) Except for W.S. 26-16-117(a), (b) and (g), 26-16-118 and article 2 of this chapter in the case of a variable annuity contract and W.S. 26-16-103, 26-16-108 through 26-16-110, 26-16-201 through 26-16-212 and 26-17-111 in the case of a variable life insurance contract and except as otherwise provided in this section, all pertinent provisions of this code apply to separate accounts and contracts relating thereto. Any individual variable life insurance contract delivered or issued for delivery in this state shall contain grace, reinstatement and nonforfeiture provisions appropriate to the contract. Any individual variable annuity contract delivered or issued for delivery in this state shall contain grace and reinstatement provisions appropriate to the contract. Any group variable life insurance contract delivered or issued for delivery in this state shall contain a grace provision appropriate to the contract. The reserve liability for variable contracts shall be established in accordance with actuarial procedures that recognize the variable nature of the benefits provided and any mortality guarantees.
26-16-503. Insurer issuing participating and nonparticipating policies; records.
(a) Any life insurer issuing both participating and nonparticipating policies shall maintain any accounting records necessary for it to determine dividends to participating policyholders on an equitable basis.
(b) In the accounting records the insurer shall make a reasonable allocation as between participating and nonparticipating policies of the expenses of the general operations or functions as are jointly shared. Any allocation of expense as between categories shall be made upon a reasonable basis, to the end that each category shall bear a just portion of joint expense involved in the administration of the business of that category.
(c) No policy shall provide for and no life insurer or representative shall knowingly offer or promise payment, credit, or distribution of participating "dividends", "earnings", "profits" or "savings", by whatever name called, to participating policies out of the profits, earnings or savings on nonparticipating policies. This provision does not restrict the generality of W.S. 26-13-110.
(a) No life insurer shall deliver or issue for delivery in this state:
(i) As part of or in combination with any life insurance, endowment or annuity contract, any agreement or plan, additional to the rights, dividends and benefits arising out of the contract, which provides for the accumulation of profits over a period of years and for payment of any of the accumulated profits only to members or policyholders of a designated group or class who continue as members or policyholders until the end of a specified or ascertainable period of years;
(ii) Any policy purporting to be "registered" or otherwise specially recorded with any agency of the state of Wyoming, or of any other state, or with any bank, trust company, escrow company or other institution other than the insurer or purporting that any reserves, assets or deposits are held for the special benefit or protection of the holder of the policy by or through the agency or institution;
(iii) Any policy or contract under which any part of the premium or of funds or values arising from the policy or contract or from investment of reserves, mortality savings, lapses or surrenders, in excess of the normal reserves or amounts required to pay death, endowment and nonforfeiture benefits in amounts as specified in or pursuant to the policy or contract, are on a basis not involving insurance or life contingency features to be placed in special funds, segregated accounts or specially designated places or to be invested in specially designated investments or types thereof, and the funds or earnings thereon to be divided among the holders of the policies or contracts, or their beneficiaries or assignees;
(iv) Any policy providing for the segregation of policyholders into mathematical groups and providing benefits for a surviving policyholder arising out of the death of another policyholder of the group, or under any other similar plan;
(v) Any policy providing benefits or values for surviving or continuing policyholders contingent upon the lapse or termination, for any reason, of the policies of other policyholders;
(vi) Any policy containing or referring to:
(A) Investment returns or profit-sharing, other than as a participation in the insurer's divisible surplus under a regular participation provision as provided for in W.S. 26-16-107;
(B) Special treatment in the determination of any dividend that may be paid as to the policy;
(C) Premiums as "deposits";
(D) Policyholder interest or returns to those of stockholders;
(E) The policyholder as a member of a select group who is entitled to extra benefits or extra dividends not available to policyholders generally;
(F) Any label, name or description of the policy as a "founders", "charter" or "coupon" policy, or name of similar connotation.
(vii) Any policy which in addition to basic life insurance benefits provides for or is combined with a series of coupons, or with a passbook or other device generally associated with securities investments, or with savings, banking or investment institutions.
(b) This section does not prohibit the provision, payment, allowance or apportionment of dividends or "savings" under regular participating forms of policies or contracts.
(a) An insurer shall perform a comparison of its insureds' policies and retained asset accounts against a death master file on at least a semi-annual basis by using the full death master file once and thereafter using the death master file update files for future comparisons in order to identify potential matches of its insureds.
(b) Not later than ninety (90) days after a death master file match an insurer shall:
(i) Complete and document a good faith effort to confirm the death of the insured or retained asset account holder against other available records and information; and
(ii) Determine whether benefits are due in accordance with the applicable policy. If benefits are due in accordance with the applicable policy the insurer shall complete and document good faith efforts to locate the beneficiary. The insurer shall also provide the appropriate claims forms or instructions to the beneficiary to make a claim including the need to provide an official death certificate, if applicable under the policy.
(c) With respect to group life insurance, an insurer shall confirm the possible death of an insured pursuant to paragraph (b)(i) of this section when the insurer maintains at least the following information on those covered under a policy:
(i) Social security number or name and date of birth;
(ii) Beneficiary designation;
(iii) Coverage eligibility;
(iv) Benefit amount; and
(v) Premium payment status.
(d) Every insurer shall implement procedures to account for all of the following:
(i) Common nicknames, initials used in lieu of a first or middle name, use of a middle name, compound first and middle names and interchanged first and middle names;
(ii) Compound last names, maiden or married names and hyphens, blank spaces or apostrophes in last names;
(iii) Transposition of the month and date within a date of birth;
(iv) Incomplete social security numbers.
(e) To the extent permitted by law, an insurer may disclose minimum necessary personal information about the insured or beneficiary to a person whom the insurer reasonably believes may be able to assist the insurer in locating the beneficiary.
(f) An insurer or its service provider shall not charge any beneficiary or other authorized representative for any fees or costs associated with a death master file search or verification of a death master file match conducted pursuant to this section.
(g) Benefits due and owing from a policy or a retained asset account, plus any applicable accrued contractual interest, shall first be payable to the designated beneficiary. If the beneficiary cannot be found, the insurer shall comply with the applicable provisions of the Uniform Unclaimed Property Act. Interest otherwise payable as required by law shall not be considered unclaimed property pursuant to W.S. 34-24-120(a).
(h) Once benefits and accrued contractual interest are presumed abandoned under W.S. 34-24-108, the insurer shall notify the state treasurer, as part of the report sent under W.S. 34-24-118, that:
(i) A beneficiary has not submitted a claim with the insurer; and
(ii) The insurer has complied with this section and has been unable, after good faith efforts documented by the insurer, to contact the beneficiary.
(j) Failure to meet any requirement of this section may constitute an unfair trade practice and is subject to the penalty provided in W.S. 26-1-107.
(k) As used in this section:
(i) "Death master file" means the United States social security administration's death master file or any other database or service that is at least as comprehensive as the United States social security administration's death master file for determining that a person has reportedly died;
(ii) "Death master file match" means a search of the death master file that results in a match of the social security number or the name and date of birth of an insured, annuity owner or retained asset account holder;
(iii) "Policy" means any policy or certificate of life insurance that provides a death benefit or any annuity contract, except that the term shall not include:
(A) Any policy or certificate of life insurance that provides a death benefit under an employee benefit plan that is:
(I) Subject to the Employee Retirement Income Security Act of 1974; or
(II) Part of a federal employee benefit program.
(B) Any policy or certificate of life insurance that is used to fund a prearranged funeral contract;
(C) Any policy or certificate of credit life or accidental death insurance;
(D) Any policy issued to a group master policyholder for which the insurer does not provide record keeping services; or
(E) An annuity used to fund an employment based retirement plan or program if the insurer:
(I) Does not perform the record keeping services; or
(II) Is not committed by terms of the annuity contract to pay death benefits to the beneficiaries of specific plan participants.
(iv) "Record keeping services" means services provided by an insurer for a group policy customer pursuant to an agreement under which the insurer is responsible for obtaining, maintaining and administering, in its own or its agent's systems, at least the following information about each individual insured under the group policy or a line of coverage thereunder:
(A) Social security number or name and date of birth;
(B) Beneficiary designation information;
(C) Coverage eligibility;
(D) Benefit amount; and
(E) Premium payment status.
(v) "Retained asset account" means any mechanism whereby the settlement of proceeds payable under a policy is accomplished by the insurer or an entity acting on behalf of the insurer depositing the proceeds into an account with check or draft writing privileges, where those proceeds are retained by the insurer or its agent, pursuant to a supplementary contract not involving annuity benefits other than death benefits.
26-17-102. Group contracts must meet group requirements; inapplicability of section; old contracts saved.
(a) No life insurance policy shall be delivered or issued for delivery in this state insuring the lives of more than one (1) individual unless to one (1) of the groups specified in this chapter and unless in compliance with the provisions of this chapter.
(b) Subsection (a) of this section does not apply to life insurance policies:
(i) Insuring only individuals:
(A) Related by blood, marriage, legal adoption or common ethnic heritage or ancestry;
(B) Having a common interest through ownership of a business enterprise, or a substantial legal interest or equity therein, and who are actively engaged in the management thereof; or
(C) Otherwise having an insurable interest in each other's lives.
(ii) Repealed by Laws 1990, ch. 3, § 3.
(c) Subsections (a) and (b) of this section and W.S. 26-17-103 through 26-17-109 do not apply to any group life insurance contract entered into or issued prior to January 1, 1968 or to any transfer of that contract to, or rewriting of that contract by, another insurer.
(a) The lives of a group of individuals may be insured under a policy issued to an employer or trustees of a fund established or adopted by an employer, which employer or trustee is deemed the policyholder, insuring the employer's employees for the benefit of persons other than the employer, subject to the following requirements:
(i) All employees or any class of employees are eligible for insurance under the terms of the policy;
(ii) The policy may define "employees" to include:
(A) The employees of one (1) or more subsidiary corporations;
(B) The employees, individual proprietors and partners of one (1) or more affiliated corporations, proprietors or partnerships, if the business of the employer and of the affiliated corporations, proprietors or partnerships is under common control through stock ownership, contract or otherwise;
(C) The individual proprietor or partner, if the employer is an individual proprietor or a partnership;
(D) Retired or former employees;
(E) Directors of a corporate employer.
(iii) Repealed by Laws 1990, ch. 3, § 3.
(iv) Repealed by Laws 1990, ch. 3, § 3.
(v) Any policy issued to insure the employees of a public body may define "employees" to include elected or appointed officials;
(vi) Policy premiums shall be paid by the policyholder subject to the following requirements:
(A) Repealed by Laws 1990, ch. 3, §§ 2, 3.
(B) Repealed by Laws 1990, ch. 3, § 3.
(C) Repealed by Laws 1990, ch. 3, § 3.
(D) If the insured employee does not pay any part of the premium for his insurance, the policy shall insure all eligible employees, except those who reject the coverage in writing and except as provided in subparagraph (E) of this paragraph;
(E) An insurer may exclude or limit the coverage on any person if evidence of individual insurability does not satisfy the insurer.
(vii) Repealed by Laws 1990, ch. 3, § 3.
(viii) Repealed by Laws 1990, ch. 3, § 3.
(a) The lives of a group of individuals may be insured under a policy issued to a creditor, a creditor's parent holding company or a trustee or agent designated by two (2) or more creditors, which creditor, holding company, affiliate, trustee or agent is deemed the policyholder, to insure debtors of the creditor concerning their indebtedness, subject to the following requirements:
(i) All debtors or any class of debtors of the creditor are eligible for insurance under the terms of the policy;
(ii) The policy may provide that the term "debtors" shall include:
(A) Borrowers of money or purchasers or lessees of goods, services or property for which payment is arranged through a credit transaction;
(B) The debtors of one (1) or more subsidiary corporations; and
(C) The debtors of one (1) or more affiliated corporations, proprietors or partnerships if the business of the policyholder and of the affiliated corporations, proprietors or partnerships is under common control.
(iii) Repealed by Laws 1990, ch. 3, § 3.
(iv) Policy premiums shall be paid by the policyholder, subject to the following requirements:
(A) Repealed by Laws 1990, ch. 3, § 3.
(B) Repealed by Laws 1990, ch. 3, § 3.
(C) If the insured debtor does not pay any part of the premium for his insurance, the policy shall insure all eligible debtors, except those who reject the coverage in writing and those who do not present evidence of individual insurability satisfactory to the insurer.
(v) Repealed by Laws 1990, ch. 3, § 3.
(vi) The policy may exclude from the classes eligible for insurance classes of debtors determined by age;
(vii) The total amount of insurance payable for an indebtedness shall not exceed the greater of the scheduled or actual amount of unpaid indebtedness to the creditor, except that insurance written concerning open-end credit having a credit limit exceeding ten thousand dollars ($10,000.00) may be in an amount not exceeding the credit limit;
(viii) The insurance may be payable to the creditor or any successor to the right, title and interest of the creditor. The payment shall reduce or extinguish the unpaid indebtedness of the debtor to the extent of the payment and any excess of the insurance is payable to the insured or the estate of the insured;
(ix) Notwithstanding paragraphs (i) through (viii) of this subsection, insurance on agricultural credit transaction commitments may be written up to the amount of the loan commitment on a nondecreasing or level term plan. Insurance on educational credit transaction commitments may be written up to the amount of the loan commitment less the amount of any repayments made on the loan.
(a) The lives of a group of individuals may be insured under a policy issued to a labor union or similar employee organization which union or organization is deemed the policyholder, to insure members of the union or organization for the benefit of persons other than the union or organization or any of its officials, representatives or agents, subject to the following requirements:
(i) All members or any class of members of the union or organization are eligible for insurance under the terms of the policy;
(ii) Policy premiums shall be paid by the policyholder, subject to the following requirements:
(A) Repealed by Laws 1990, ch. 3, § 3.
(B) Repealed by Laws 1990, ch. 3, § 3.
(C) Repealed by Laws 1990, ch. 3, § 3.
(D) If the insured member does not pay any part of the premium for his insurance, the policy shall insure all eligible members, except those who reject the coverage in writing and those who do not present evidence of individual insurability satisfactory to the insurer.
(iii) Repealed by Laws 1990, ch. 3, § 3.
(iv) Repealed by Laws 1990, ch. 3, § 3.
(a) The lives of a group of individuals may be insured under a policy issued to a trust or the trustees of a fund established or adopted by two (2) or more employers, by one (1) or more labor unions or similar employee organizations, or by one (1) or more employers and one (1) or more labor unions or similar employee organizations, which trust or trustees are deemed the policyholder, to insure employees of the employers or members of the unions or organizations, for the benefit of persons other than the employers, unions or organizations, subject to the following requirements:
(i) No policy shall be issued to insure employees of any employer whose eligibility to participate in the fund as an employer arises out of considerations directly related to the employer being a commercial correspondent or business client or patron of another employer, except if the other employer exercises substantial control over the business operations of the participating employers;
(ii) All employees of the employers, members of the unions or organizations, or any classes of the employers, union members or organization members are eligible for insurance under the terms of the policy;
(iii) The policy may define "employees" to include:
(A) Retired or former employees;
(B) The individual proprietor or partners, if an employer is an individual proprietor or a partnership;
(C) The trustees, trustees' employees, or both, if their duties are principally connected with the trusteeship;
(D) Employees of one (1) or more subsidiary corporations and the employees, individual proprietors and partners of one (1) or more affiliated corporations, proprietorships or partnerships if the business of the employer and of the affiliated corporations, proprietorships or partnerships is under common control;
(E) Directors of a corporate employer.
(iv) Repealed by Laws 1990, ch. 3, § 3.
(v) Policy premiums shall be paid by the trustees subject to the following requirements:
(A) Repealed by Laws 1990, ch. 3, §§ 2, 3.
(B) Repealed by Laws 1990, ch. 3, § 3.
(C) If the covered person does not pay any part of the premium for his insurance, the policy shall insure all eligible persons, except those who reject the coverage in writing and those who do not present evidence of individual insurability satisfactory to the insurer.
(vi) Repealed by Laws 1990, ch. 3, § 3.
(vii) Repealed by Laws 1990, ch. 3, § 3.
(a) Insurance under any group life insurance policy issued pursuant to W.S. 26-17-103, 26-17-105, 26-17-106, 26-17-109, 26-17-127 or 26-17-128 may be extended to insure the employees or members or any class of employees or members against loss due to the death of their spouses and dependent children:
(i) Repealed by Laws 1990, ch. 3, §§ 2, 3.
(ii) If the employer or member does not pay any part of the premium for the spouse's or dependent child's coverage, the policy shall insure all eligible employees or members with respect to their spouses and dependent children or any class of employees or members except that an insurer may exclude or limit the coverage on any spouse or dependent child if evidence of individual insurability does not satisfy the insurer;
(iii) Repealed By Laws 2009, Ch. 93, § 1.
(iv) Repealed by Laws 1990, ch. 3, § 3.
(b) Repealed by Laws 1990, ch. 3, § 3.
(c) Repealed by Laws 1990, ch. 3, § 3.
(d) Repealed by Laws 1990, ch. 3, § 3.
(e) Notwithstanding the provisions of W.S. 26-17-117, only one (1) certificate need be issued for each family unit if a statement concerning any dependent's coverage is included in the certificate.
(a) The lives of a group of individuals may be insured under a policy issued to a credit union or a trustee or agent designated by two (2) or more credit unions, which credit union, trustee or agent is deemed the policyholder, to insure members of the credit union for the benefit of persons other than the credit union, trustee, agent or any of their officials, subject to the following requirements:
(i) All members or all of any class of members of the credit union are eligible for insurance under the terms of the policy;
(ii) Policy premiums shall be paid by the policyholder from the credit union's funds and shall insure all eligible members except that an insurer may exclude or limit the coverage on any member if evidence of individual insurability does not satisfy the insurer.
(A) Repealed by Laws 1990, ch. 3, § 3.
(B) Repealed by Laws 1990, ch. 3, § 3.
(iii) Repealed by Laws 1990, ch. 3, § 3.
(B) Repealed by Laws 1990, ch. 3, § 3.
26-17-110. Provisions required in group contracts; exceptions.
(a) No group life insurance policy shall be delivered in this state unless it contains provisions conforming in substance to the provisions set forth in W.S. 26-17-110 through 26-17-121 and 26-17-130 or provisions which in the commissioner's opinion are more favorable to the persons insured, or at least as favorable to the persons insured and more favorable to the policyholder, except that:
(i) W.S. 26-17-116 through 26-17-120 and 26-17-130 do not apply to policies issued to a creditor to insure debtors of that creditor;
(ii) The standard provisions required for individual life insurance policies do not apply to group life insurance policies; and
(iii) If the group life insurance policy is on a plan of insurance other than the term plan, it shall contain a nonforfeiture provision which in the commissioner's opinion is equitable to the insured persons and to the policyholder, but nothing in this subsection requires that group life insurance policies contain the same nonforfeiture provisions as are required for individual life insurance policies.
The policyholder is entitled to a grace period of thirty-one (31) days for the payment of any premium due except the first. The death benefit coverage continues in force during the grace period, unless the policyholder gives the insurer written notice of discontinuance in advance of the date of discontinuance and in accordance with the terms of the policy. The policy may provide that the policyholder is liable to the insurer for the payment of a pro rata premium for the time the policy is in force during the grace period.
The validity of the policy shall not be contested, except for nonpayment of premium, after it is in force for two (2) years from its date of issue. No statement made by any person insured under the policy relating to his insurability shall be used in contesting the validity of the insurance with respect to which the statement is made after the insurance is in force prior to the contest for a period of two (2) years during the person's lifetime nor unless it is contained in a written instrument he signs.
26-17-113. Application; statements are representations.
A copy of the policyholder's application, if any, shall be attached to the policy when issued and is a part of the contract. Any statements the policyholder or the persons insured make are representations and not warranties, and no statement any person insured makes shall be used in any contest unless a copy of the instrument containing the statement is or has been furnished to the person or, in the event of death or incapacity of the insured person, to his beneficiary or personal representative.
The policy shall set forth the conditions, if any, under which the insurer reserves the right to require a person eligible for insurance to furnish evidence of individual insurability satisfactory to the insurer as a condition to part or all of his coverage.
(a) The policy shall specify:
(i) That an equitable adjustment of premiums or of benefits or both shall be made in case the age of a person insured is misstated; and
(ii) The method of adjustment to be used.
(a) Any sum due by reason of the death of the person insured is payable to the beneficiary designated by the person insured, except that if the policy refers to family status and does not specify family members by name, the beneficiary may be the family member specified by status in the policy, subject to:
(i) The provisions of the policy as to all or any part of the sum in case there is no designated beneficiary living at the time of the insured's death; and
(ii) Any right the insurer reserved in the policy and set forth in the certificate to pay at its option a part of the sum not exceeding two thousand dollars ($2,000.00) to any person appearing to the insurer to be equitably entitled thereto by reason of having incurred funeral or other expenses incident to the last illness or death of the person insured.
(b) Payment of benefits shall be subject to the interest provisions of W.S. 26-16-112 and time requirements of W.S. 26-15-124, provided the interest provisions of W.S. 26-16-112 shall not apply to variable contracts which provide for insurance or annuity benefits which may vary according to the investment experience of any separate account or accounts maintained by the insurer as to such contract.
The insurer shall issue to the policyholder for delivery to each person insured an individual certificate with statements describing the insurance protection to which he is entitled, to whom the insurance benefits are payable, any dependent's coverage included in the certificate, and the rights and conditions set forth in W.S. 26-17-118 through 26-17-120 and 26-17-130.
26-17-118. Conversion on termination of eligibility.
(a) If the insurance, or any portion of it, on a person or dependent of a person covered under the policy ceases because of termination of employment or of membership in any of the classes eligible for coverage under the policy, the insurer shall offer to issue to him, without evidence of insurability, an individual life insurance policy without disability or other supplementary benefits, provided:
(i) Application for the policy shall be made, and the first premium paid to the insurer, within thirty-one (31) days after termination;
(ii) The policy, at the person's option, shall be on any one (1) of the forms customarily issued by the insurer at the age and for the amount applied for, except that the group policy may exclude the option to elect term insurance;
(iii) The policy shall be in an amount not exceeding the amount of life insurance which ceases because of the termination less the amount of any life insurance for which the person is or becomes eligible under the same or any group policy within thirty-one (31) days after the termination, provided that any amount of insurance which matures on or before the date of such termination as an endowment payable to the person insured, whether in one (1) sum, in installments or in the form of an annuity, for the purposes of this provision, shall not be included in the amount which is considered to cease because of the termination; and
(iv) The premium on the individual policy shall be at the insurer's then customary rate applicable to the form and amount of the individual policy, to the class of risk to which the person then belongs and to his age attained on the effective date of the individual policy.
(b) Subject to the conditions set forth in subsection (a) of this section, the conversion privilege is available:
(i) To a surviving dependent, if any, at the death of the employee or member concerning the coverage under the group policy which terminates by reason of the death; and
(ii) To the dependent of the employee or member upon termination of the dependent's coverage if the employee or member remains insured under the group policy and if the dependent ceases to be a qualified family member under the group policy.
(a) If the group policy terminates or is amended to terminate the insurance of any class of insured persons, any person insured thereunder at the date of the termination whose insurance terminates, including the insured dependent of a covered person, which insured or insured dependent has been so insured for at least three (3) years prior to the termination date is entitled to have issued to him by the insurer an individual life insurance policy, subject to the same conditions provided by W.S. 26-17-118, except that the group policy shall provide that the amount of the individual policy is the amount of the person's life insurance protection ceasing because of the termination or amendment of the group policy, less the amount of any life insurance for which he is or becomes eligible under any group policy issued or reinstated by the same or another insurer within thirty-one (31) days after the termination.
(i) Deleted by Laws 1990, ch. 3, § 2.
(ii) Repealed by Laws 1990, ch. 3, §§ 2, 3.
If a person insured under the group policy, or the insured dependent of a covered person, dies during the period within which he would have been entitled to have an individual policy issued to him in accordance with W.S. 26-17-118 or 26-17-119 and before the individual policy is effective, the amount of life insurance which he would have been entitled to have issued under the individual policy is payable as a claim under the group policy, whether or not application for the individual policy or the payment of the first premium has been made.