On Friday, August 12, 2016, the New Jersey Department of Banking and Insurance (Department) issued two orders impacting life insurance. First, the Department issued Order No. A16-115, affirming the operative date of the valuation manual to implement principle-based reserve valuation for all life insurance policies issued on or after January 1, 2017. The purpose of the Order is to implement the December 26, 2014 amendments to the insurance laws governing the valuation of reserve liabilities for life insurance policies issued in New Jersey pursuant to P.L. 2014, c. 81 (the “Act”). The Act requires the use of principle-based reserve valuation for life insurance policies sold on or after the operative date of the valuation manual adopted by the NAIC, or by January 1, 2017. The valuation model is defined in N.J.S.A. 17B:19-1.1. A copy of the Department’s Order is linked here.
Order No. A16-116 – In the Matter of Establishing a Life Insurance Policy and Annuity Locator Service – was also issued on August 12. The Department announced that it would cooperate with the National Association of Insurance Commissioners (NAIC) to establish a life insurance policy and annuity locator service to assist beneficiaries of life insurance policies and annuity contracts with determining whether a policy or contract exists, and if so, with what insurance company(ies).
The Order requires that companies authorized to issue life insurance policies and/or annuity contracts in the State of New Jersey establish and provide the Department on or before August 26, 2016 with an email address specifically designated for receipt of missing policy or contract search requests from the Department and/or the NAIC. The carriers are further ordered to access and monitor the email account to review missing policy search requests on at least a weekly basis to ensure that the review occurs even in the event that roles or assignment of personnel within the company change. Finally, all companies issuing life or annuity policies are required to directly contact the beneficiaries of those policies who make requests and provide separate notice of the found policy(ies) or contracts to the Department at email@example.com. A copy of the Department’s Order is linked here.