| Contact Person: | Illinois Department of Insurance | 320 West Washington Street | ||
| Cindy Colonius | Review Requirements Checklist | Springfield, IL 62767-0001 | ||
| 217-782-4572 | ||||
| Cindy.Colonius@Illinois.gov |
Effective 1/01/08 |
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| Line(s) of | Line(s) of | |||
| Business | Insurance | |||
Group Universal Life |
Group Universal Life Policies |
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| Click here for interactive version of this document to be down loaded and submitted with this filing | Word Document - Alteration of this document will result in rejection of the filing |
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| Illinois Insurance Code Link | Illinois Compiled Statutes Online | |||
| Illinois Administrative Code Link | Administrative Regulations Online | |||
| Product Coding Matrix | Product Coding Matrix | |||
| REVIEW REQUIREMENTS | REFERENCE |
DESCRIPTION OF REVIEWSTANDARDS REQUIREMENTS |
LOCATION OF STANDARD IN FILING |
| NOTE: These brief summaries do not include all requirements of all laws, regulations, bulletins, or requirements, so review actual law, regulation, bulletin, or requirement for details to ensure that forms are fully compliant before filing with the Department of Insurance. | |||
| FORM FILING REQUIREMENTS | REFERENCE | DESCRIPTION OF REVIEW STANDARDS REQUIREMENTS | LOCATION OF STANDARD IN FILING |
| Uniform Transmittal Document (Etrans) | 50 IL Adm. Code 916 | Form filings must now be submitted either by SERFF or CD-ROM. Please visit
the Department's web site for the Universal Transmittal Document (Etrans)
by clicking this link. Scroll down to "Universal Transmittal Document Software (Etrans)" |
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| Unique Form Number | 50 IL Adm. Code 916 50 IL Adm. Code 1405.20 b) 1) |
A unique form number must be on each form in the lower left hand corner. | |
| Review Requirements Checklist | Go to Review Requirements Checklists on DOI web site. See next column | Each filing must include a completed Review Requirements Checklist that must contain a completed “Location of Standard in Filing” column for each required element of the filing. Please indicate the proper page # and form # for each entry. |
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| Cover Letter and Letter of Submission | 50 IL Adm. Code 1405.20 (e) |
In addition to referencing any previously approved form number(s) as required by 50 IL Adm. Code 1405.20(e), those references must also include the filing number and SERFF tracking number (if applicable and available) for the referenced forms. Letters of submission must generally describe the intent and use of the form being filed and, if applicable, how it will be used with any previously approved form(s). |
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| GENERAL REQUIREMENTS FOR ALL FILINGS | REFERENCE | DESCRIPTION OF REVIEW STANDARDS REQUIREMENTS | |
| Representations not Warranties | 215 ILCS 5/231.1(C) | The policy must contain a provision that a copy of the application, if any, shall be attached to the policy when issued and that all statements made in any application shall be considered to be representations and not warranties. The provision must further declare that no statement shall be used in any legal action unless a copy has been furnished to the insured. | |
| Incontestable Period | 215 ILCS 5/231.1(B) 50 IL Adm. Code 1405.40 e) |
The policy shall be incontestable after a period of no more than 2 years, except for nonpayment of premium and certain other conditions. | |
| Misstatement of Age or Sex | 215 ILCS 5/231.1(E) 50 IL Adm. Code 1411.50 g) |
If a misstatement of age or sex is found on the group enrollment form the policy shall provide the death benefit amount that would be purchased by the most recent mortality charge at the correct age or sex. | |
| Grace Period | 215 ILCS 5/231.1(A) 50 IL Adm. Code 1411.50 f) |
The insured is entitled to a grace period of 31 days. | |
| Non-forfeiture and cash surrender values | 50 IL Adm. Code 1411.40 | The minimum non-forfeiture and cash surrender values for group universal life polices must follow the standards of this section. | |
| Appropriate Descriptive Title | 215 ILCS 5/143(1) 215 ILCS 5/149(1) |
There must be an appropriate, unambiguous title describing the form of the policy. | |
| Evidence of Insurability | 50 IL Adm. Code 5/231.1(D) | There must be a provision in the policy detailing any circumstances in which the insurer might require a prospective insured to furnish evidence of insurability satisfactory to the insurer as a condition of all or part of the coverage. | |
| Beneficiary Designation | 215 ILCS 5/231.1(F) | There must be a provision in the policy stating any sum becoming due by reason of the death of the insured shall be payable to the beneficiary designated by the insured. | |
| Conversion Privilege | 215 ILCS 5/231.1(H) 215 ILCS 5/231.1(K) |
There must be a provision in the policy that if coverage, or any part of it, ceases for the insured or a dependent due to termination of employment or membership that the individual is entitled to, without evidence of insurability, an individual policy of life insurance. If the group policy terminates or is amended to terminate any class of insured persons, every insured whose insurance terminates, including insured dependents, who has been covered for at least five years is entitled to an individual policy of life insurance with the same limitations as provided in 215 ILCS 5/231.1(H). |
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| Termination of Insurance | 215 ILCS 5/231.1 (I) | There must be a provision in the policy that termination of employment or membership will not cause the insured's coverage to end under the group policy until the expiration of the period for which premium has been paid, not to exceed 31 days. | |
| Payment of Claim | 215 ILCS 5/231.1(L) | There must be a provision in the policy providing that if the insured person dies during a period in which the individual would have been eligible to convert to an individual policy as provided for in 215 ILCS 5/231.1(H) or (I) the amount of life insurance that would have been payable under the individual policy will be payable as a claim under the group policy regardless of whether an application had been made or the first premium paid. | |
| Continuation of Coverage | 215 ILCS 5/231.1(M) | If active employment is a condition of insurance there must be a provision stating that an insured may continue coverage during his/her period of total disability by timely payment to the policyholder of that portion of the premium required from the insured had total disability not occurred. | |
| Group issuance of certificates | 215 ILCS 5/231.1(G) | There must be a provision that the insurer will issue to the policyholder the individual certificates to be distributed to insureds. | |
| Addition of new insureds | 215 ILCS 5/231.1(J) | There must be a provision that new employees or members desiring coverage are eligible to be added to the plan. | |
| ADMINISTRATIVE CODE PROVISIONS | |||
| Name and Address Required | 50 IL Adm. Code 1405.20 c) 1) 2) | The insurer name and home office address is required on the front and back page of the policy. | |
| Schedule Page Requirements | 50 IL Adm. Code 1405.20 d) 3) | The schedule page must be completed in "John Doe" fashion. | |
| Automatic Premium Loans | 50 IL Adm. Code 1405.40 c) | Automatic premium loan provisions must be elective. | |
| War Clause | 50 IL Adm. Code 1405.40
u) 50 IL Adm. Code 1402.10 and 1402.20 |
Military and noncombatant civilian exclusion clauses are permissible as long as the insurer has excluded benefits due to war in the incontestable clause and complies with the requirements of 50 IL Adm. Code 1402. | |
| Policy Guarantees | 50 IL Adm. Code 1411.50 c) | The policy shall provide guarantees of minimum interest credits and maximum mortality and expense charges. All values and data shown in the policy or group certificate shall be based on guarantees, and the policy or certificate may not contain any values, figures or amounts not guaranteed. | |
| Calculation of Cash Surrender Value | 50 IL Adm. Code 1411.50 d) | The policy is required to contain at least a description of the calculation of the cash surrender value that includes the information in 50 IL Adm. Code 1411.50 (d) 1-6. | |
| Changes in Basic Coverage | 50 IL Adm. Code 1411.50 e) | The policy must outline any limitations on the amount or timing of the policy owner's right to change the basic policy and shall state whether any increase in coverage initiates a new period of contestability and/or suicide limitation period for the additional coverage. | |
| Disclosure Requirements for Illustrations | 50 IL Adm. Code 1411.50
i) 50 IL Adm. Code 1406 |
Disclosure of information about the policy or contract for which an applicant is applying shall follow the standards of 50 IL Adm. Code 1406. | |
| Maturity or End Date Disclosure Requirement | 50 IL Adm. Code 1411.50 h) | If a policy provides for a maturity date, end date or something similar, a statement, placed in close proximity to this date, must be included indicating that coverage may not continue to the maturity date even if scheduled premiums are paid in a timely manner if those circumstances are applicable. | |
| Periodic Disclosure(Annual Report) | 50 IL Adm. Code 1411.50 a) & 1411.60 a) | The policy shall provide that an annual report be sent to the policy owner that keeps that individual updated on the status of the policy and complies with the requirements of 50 IL Adm. Code 1411.50(a) & 1411.60(a). | |
| Valuation Requirement | 50 IL Adm. Code 1411.30 | The minimum valuation standard for individual and group universal life polices is the Commissioners Reserve Valuation Method. Tables and interest rates are provided in this section. | |
| GENERAL INFORMATION | |||
| Cash Surrender Deferred | 215 ILCS 5/229.2(1)(vi) | Insurers may defer cash surrender payments for 6 months. | |
| HIV/AIDS Questions on Application | 215 ILCS 5/143(1) | Questions designed to elicit information regarding AIDS, ARC and HIV must be specifically related to the testing, diagnosis or treatment done by a physician or an appropriately licensed clinical professional acting within the scope of his/her license. |
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| No Discrimination on Lawful Travel | 215 ILCS 5/236(e) | No life company may discriminate in its underwriting or rating practices based on an insured’s past or future lawful travel. Exceptions may be made based on sound actuarial principals or related to actual or reasonably expected experience not based solely on a destination’s inclusion on the US Department of State’s travel warning list. | |
| DEPARTMENT POSITIONS | |||
| Last Survivor Benefit | 215 ILCS 5/143(1) | The last survivor benefit payment requires disclosure on the face page of the policy that, "NO DEATH BENEFIT WILL BE PAID ON THE DEATH OF THE FIRST INSURED TO DIE". Failure to include such language would be ambiguous and misleading to the insured. | |
| Terminology | 50 IL. Adm. Code 1405.40 g) | Terminology such as "proof satisfactory to us" is not permitted. | |
| Lapse Terminology | 215 ILCS 5/143(1) | Language such as "no lapse", "no lapse guarantee" or "death benefit guarantee" is permitted only if there is a statement, in close proximity to the provision, indicating that the guarantee does not mean the policy or contract would never lapse. | |
| Extended Maturity Date Rider | 215 ILCS 5/143(1) | An extended maturity date coverage option is permitted for newly issued policies only if the language is contained in the policy or contract. The coverage may not be added as a rider. However, a rider may be used to add extended maturity date coverage to in-force policies. | |
| Actuarial Certification Requirement | 215 ILCS 5/143(1) | Insurers must provide an actuarial certification that the extended maturity date option complies with Illinois valuation and non-forfeiture laws since certain mortality tables require the policy or contract become paid up at age 99. Once a policy becomes paid up no cost of insurance or any other fees may be charged, but interest must still be credited. | |
| Disclosure Requirement | 215 ILCS 5/143(1) | A statement must be included in the policy, contract, or rider disclosing that there may be tax consequences associated with the extended maturity date option and the insured should consult with his/her tax advisor for further guidance. This statement must be in close proximity to the provision. | |
| Equity Indexed Product Actuarial Memorandum | 215 ILCS 5/143(1) | Insurers must state in their actuarial memorandum that the reserving methodology is in compliance with Actuarial Guideline 36. |