Description: The article shared results from a survey conducted in May of best-estimate VA assumptions as of year-end 2018. Specifically, the discussion focused on lapse, utilization and separate account return assumptions. The results show that a considerable range of practice across assumptions used by the industry for variable annuities. There is a propensity to use complex assumptions to better match the underlying complexity in the products with the behavior expected from policyholders in a dynamic and volatile economic environment.

Description: The article is a summary of Society of Actuaries report entitled “Annuity Market Pricing Approaches” sponsored by the Retirement Section Research Committee. The report examines the Canadian Institute of Actuaries (CIA) methodology of developing solvency valuation assumptions, compares it to methods used in the U.S., and considers if it could be used in other markets, such as U.S. group annuities or individual annuities

Description: Provides in-depth discussion of IRS Rev. Proc. 2008-24, including tax background of partial annuity exchanges. Then discusses partial annuitizations and “modified endowment contracts.”

Description: Outlines a generic business model for a life insurance company and concludes with thoughts on future trends and prospects.

Description: This article presents a discussion of Actuarial Guideline 54 (AG LIV), both the regulatory impetus in its creation as well as the requirements it outlines for a RILA contract to qualify as a variable annuity under the NAIC Variable Annuity Model law and thus be exempt from Fixed Annuity Non-Forfeiture Requirements. Includes an example calculation.

Description: This presentation presents a decumulation strategy during retirement with the purchase of deferred annuities.

Description: A discussion of tail-design LTC riders for annuities and how contract cash values are offset by reductions to the annuity contract. LTC benefits, and how they relate to the annuity contracts, are also discussed.

Description: The author proposes an annuity clearinghouse to encourage employers to offer annuity accumulation products in their defined contribution plans. This addresses the lack of portability that is associated with, and discourages the use of, defined contribution plans.

Description: SECURE 2.0 included provisions that improve the ability of insurers to serve those who own qualified annuities. Several previously disallowed distribution methods are now allowed. These changes should increase the availability and desirability by contract owners to choose a payout annuity compared to required minimum distributions. An insurer considering enhancing qualified annuitization offerings might follow the approach outlined to potentially increase qualified annuitization sales and assist contract owners in protecting their principal more directly than previously.

Description: The article analyzes Private Letter Ruling 202031008, which considers how Internal Revenue Code sections 72(q) and (u) apply to an annuity contract issued to a trust. In particular, the Ruling interprets the terms “taxpayer,” “holder” and “held by” in those Code sections in situations where a non-qualified deferred annuity contract is issued to a grantor trust or a non-grantor trust. The Ruling’s analysis and conclusions differ in some respects depending on which of these types of trusts is involved. In addition, although the Ruling does not address sections 72(s) or 72(e)(4)(C), the Ruling has potential implications under those provisions because they also use the term “holder” and “holds,” respectively.