Sec. 31.15.04.04. Contract Summary

A. For the purposes of this chapter, "contract summary" means a written statement describing the elements of the annuity contract and deposit fund, including but not limited to:

(1) A prominently placed title as follows: STATEMENT OF BENEFIT INFORMATION. (This shall be followed by an identification of the annuity contract or deposit fund, or both, to which the statement applies.)

(2) The name and address of the insurance agent or, if no agent is involved, a statement of the procedure to be followed in order to receive responses to inquiries regarding the contract summary.

(3) The full name and home office or administrative office address of the insurer which will issue the annuity contract or administer the deposit fund.

(4) The death benefits for the deposit fund, and for the annuity contract during the deferred period, and the form of the annuity payout. In the case where a choice of annuity payout form is provided, this item shall show the payout options guaranteed and the form of annuity payout selected in §A(6), (7), and (9) of this regulation.

(5) A prominent statement that the contract does not provide cash surrender values if that is the case.

(6) The amount of the guaranteed annuity payments at the scheduled commencement of the annuity, based on the assumption that all scheduled considerations are paid and there are no prior withdrawals from or partial surrenders of the contract and no indebtedness to the insurer on the contract.

(7) Illustrative Annuity Payments.

(a) On the same basis as §A(6) of this regulation except for guarantees, illustrative annuity payments not greater in amount than those based on (i) the current dividend scale and the interest rate currently used to accumulate dividends under these contracts, or the current excess interest rate credited by the insurer, and (ii) current annuity purchase rates.

(b) A dividend scale or excess interest rate which has been publicly declared by the insurer with an effective date not more than 2 months after the date of declaration shall be considered a current dividend scale or current excess interest rate.

(8) For annuity contracts or deposit funds for which guaranteed cash surrender values at any duration are less than the total considerations paid, a prominent statement that this contract or fund may result in loss if kept for only a few years, together with a reference to the schedule of guaranteed cash surrender values required by §A(9)(c) of this regulation.

(9) The following amounts, when applicable, for the first 5 contract years and representative contract years thereafter sufficient to clearly illustrate the patterns of considerations and benefits, including but not limited to the 10th and 20th contract years and at least one age from 60 through 65 or the scheduled commencement of annuity payments, if any, whichever is earlier:

(a) The gross annual or single consideration for the annuity contract.

(b) Scheduled annual or single deposit for the deposit fund, if any.

(c) The total guaranteed cash surrender value at the end of the year or, if no guaranteed cash surrender values are provided, the total guaranteed paid-up annuity at the end of the year. Values for a deposit fund shall be shown separately from those for a basic contract.

(d) Total Illustrative Cash Value.

(i) The total illustrative cash value or paid-up annuity at the end of the year, not greater in amount than that based on (aa) the current dividend scale and the interest rate currently used to accumulate dividends under these contracts or the current excess interest rate credited by the insurer, and (bb) current annuity purchase rates.

(ii) A dividend scale or excess interest rate which has been publicly declared by the insurer with an effective date not more than 2 months after the date of declaration shall be considered a current dividend scale or current excess interest rate.

(10) For a contract summary which includes values based on the current dividend scale or the current dividend accumulation or excess interest rate, a statement that these values are illustrations and are not guaranteed.

(11) The date on which the contract summary is prepared.

B. The contract summary shall be a separate document. All information required to be disclosed shall be set out in such a manner as not to minimize or render any portion obscure. Any amounts which remain level for 2 or more contract years may be represented by a single number if it is clearly indicated what amounts are applicable for each contract year. Amounts in §A(4), (6), (7), and (9) of this regulation shall, in the case of flexible premium annuity contracts, be determined either according to an anticipated pattern of consideration payments or on the assumption that considerations payable will be $1,000 per year. If not specified in the contract, annuity payments shall be assumed to commence at age 65 or 10 years from issue, whichever is later. Zero amounts shall be displayed as zero and may not be displayed as blank spaces.