Demonstration that a contract’s nonforfeiture amounts comply with this section shall be based on the following assumptions:

1. A. values should be tested at the end of each of the first twenty (20) contract years;
2. B. a net investment return of seven percent (7%) per year should be used;
3. C. if the contract provides for transfers to another separate account or to another investment division within the same separate account, one transfer per contract year should be assumed;
4. D. in determining the state premium tax applicable to the contract, the state of residence should be assumed to equal the state of delivery;
5. E. with respect to contracts providing for periodic considerations, monthly considerations of $100 should be assumed for each of the first 240 months;
6. F. with respect to contracts providing for a single consideration, a $10,000 single consideration should be assumed; and

7. G. the following contract charges should be used:

   (1) for contracts filed in 1980 or earlier, the annual contract charge of $30 referred to in 13 nmac 9.3.19 and 9.3.20 [now 13.9.3.19 NMAC and 13.9.3.20 NMAC], the charge of $10 per transfer referred to in 13 nmac 9.3.19 [now 13.9.3.19 NMAC], the collection charge of $1.25 per consideration referred to in 13 nmac 9.3.20 [now 13.9.3.20 NMAC], and the contract charge of $75 referred to in 13 NMAC 9.3.20.2 [now Subsection B of 13.9.3.20 NMAC].

   (2) for contracts filed in 1981 or later, the contract charges in 13 NMAC 9.3.21.7.1 [now Paragraph (1) of Subsection G of 13.9.3.21 NMAC] multiplied by the ratio of the consumer price index for June of the calendar year preceding the date of filing, to the consumer price index for June 1979.

8. H. If the contract provides for allocation of considerations to both fixed and variable accounts, one hundred percent (100%) of the considerations should be assumed to be allocated to the variable account.

9. I. As used herein, the consumer price index means the index for all urban consumers for all items published by the bureau of labor statistics of the United States department of labor or its successor. If publication of the consumer price index ceases, or if the index otherwise becomes unavailable or is altered in such a way as to be unusable, the superintendent will substitute an index deemed suitable by the superintendent.

   [7/1/97; Recompiled 11/30/01]