NAC688A.357. Plans with separate rates for preferred and standard smoker lives; certification by appointed actuary.

For each plan of insurance with separate rates for preferred and standard smoker lives, an insurer may use the preferred smoker and residual standard smoker tables in the 2001 CSO Preferred Class Structure Mortality Table in lieu of the smoker mortality table in the 2001 CSO Mortality Table to determine minimum reserves. On the valuation date on which the insurer first uses the tables in the 2001 CSO Preferred Class Structure Mortality Table to determine minimum reserves, and annually thereafter, for business valued under the preferred smoker table, the appointed actuary must certify that:

     1. The present value of death benefits over the 10-year period immediately following the valuation date, using the anticipated mortality experience without recognition of mortality improvement beyond the valuation date for each class, is less than the present value of death benefits using the preferred smoker valuation basic table corresponding to the valuation table being used for that class; and

     2. The present value of death benefits over the future life of the contracts, using anticipated mortality experience without recognition of mortality improvement beyond the valuation date for each class, is less than the present value of death benefits using the preferred smoker valuation basic table.

     (Added to NAC by Comm’r of Insurance by R031-08, eff. 8-26-2008)