NU Online News Service, Aug. 2, 7:04 p.m. – Regulators are talking about the interest rate life insurers should use to determine minimum annuity nonforfeiture values.
Nonforfeiture values are legally required minimum cash values that certain life insurance company customers get when they give up life insurance policies or annuity contracts.
The standard rate has been 3%.
Some regulators who are following the current National Association of Insurance Commissioners, Kansas City, Mo., nonforfeiture debate say that, given the current climate of low interest rates and low returns on other types of investments, expecting life insurers to offer a minimum interest rate of 3% is unrealistic.
Other regulators maintain that deciding which interest rates to use to determine minimum nonforfeiture values is more of an intermediate problem than a short-term problem.