1. A. The net premiums within each segment are a uniform percentage of the respective guaranteed gross premiums within the segment. The uniform percentage for each segment is such that, at the beginning of the segment, the present value of the net premiums within the segment equals:

   1. (1) The present value of the death benefits within the segment; plus
   2. (2) The present value of any unusual guaranteed cash value, as specified in Regulation .11D of this chapter, occurring at the end of the segment; less
   3. (3) Any unusual guaranteed cash value occurring at the start of the segment; plus

   4. (4) For the first segment only, the excess of §A(4)(a) over §A(4)(b) of this regulation as follows:

      1. (a) A net level annual premium equal to the present value, at the date of issue, of the benefits provided for in the first segment after the first policy year, divided by the present value, at the date of issue, of an annuity of one per year payable on the first and each subsequent anniversary within the first segment on which a premium falls due. The net level annual premium may not exceed the net level annual premium on the 19-year premium whole life plan of insurance of the same renewal year equivalent level amount at an age 1 year higher than the age at issue of the policy.
      2. (b) A net 1-year premium for the benefits provided for in the first year policy.
2. B. The length of each segment is determined by the contract segmentation method, as defined in Regulation.07B of this chapter.
3. C. The interest rates used in the present value calculations for any policy may not exceed the maximum valuation interest rate, determined with a guarantee duration equal to the sum of the lengths of all segments of the policy.
4. D. For both basic reserves and deficiency reserves computed by the segmented method, present values shall include future benefits and net premiums in the current segment and in all subsequent segments.

Authority: Insurance Article, §2-109, Title 5, Subtitle 3, and §16-309, Annotated Code of Maryland

Effective date: May 5, 1997 (24:9 Md. R. 656)

Annotation: Implementation of this chapter is described in Regulation .02D. Notice that this chapter is being implemented will be published in the Maryland Register.

Chapter recodified from COMAR 09.31.16 to COMAR 31.05.03 effective September 7, 1998 (25:18 Md. R. 1439)

Chapter revised as an emergency provision effective January 1, 2000 (27:3 Md. R. 326); revised permanently effective May 15, 2000 (27:8 Md. R. 860)

Chapter revised effective January 1, 2004 (30:24 Md. R. 1746)

Regulation .03B amended effective March 26, 2007 (34:6 Md. R. 630); December 15, 2008 (35:25 Md. R. 2151)

Regulation .04C adopted effective March 26, 2007 (34:6 Md. R. 630)

Regulation .05B amended effective December 15, 2008 (35:25 Md. R. 2151)

Regulation .05C adopted effective December 15, 2008 (35:25 Md. R. 2151)

Regulation .05C amended effective December 28, 2009 (36:26 Md. R. 1999)

Regulation .06 amended effective March 26, 2007 (34:6 Md. R. 630)

Regulation .06 amended as an emergency provision effective January 25, 2010 (37:4 Md. R. 336); amended permanently effective May 3, 2010 (37:9 Md. R. 674)

Regulation .10C, H amended as an emergency provision effective January 25, 2010 (37:4 Md. R. 336); amended permanently effective May 3, 2010 (37:9 Md. R. 674)

Regulation .15 adopted effective March 26, 2007 (34:6 Md. R. 630)

Regulation .15 amended as an emergency provision effective January 25, 2010 (37:4 Md. R. 336); amended permanently effective May 3, 2010 (37:9 Md. R. 674)