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'Mix and Match' Adopted By IIPRC With Standards

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The management committee of the Interstate Insurance Product Regulation Commission has voted to adopt product standards and to create a 2-year transition period that would allow the mixing and matching of compact product standards and state requirements.

The decision on a proposal developed by Ohio and Vermont was adopted by a vote of 9-1 with 1 abstention.

The standards include individual current assumption whole life, individual modified single premium variable life, and individual modified single premium joint first-to-die variable life insurance policy standards.

Further revisions to the product filing rule would require that all state filing fees be paid and would create an appendix listing product lines and uniform standards that will be used to determine when mix-and-match will end for a product line. The appendix will be developed within 6 months of the effective date of the product filing rule. Revisions would also allow mix-and-match to continue indefinitely for any insurance-annuity contract in effect as of the sunset date of a given product line.

The committee’s vote followed a motion by Pennsylvania to defer any action until a legal analysis was completed. Pennsylvania argued that it would be difficult for a commissioner to disapprove a mix-and-match filing because it would be under the commission’s jurisdiction. There could only be action taken on a fee-based form and not on a compact-based form, Pennsylvania said.

That motion was defeated, however, 10-2, with only Pennsylvania and Washington state voting for approval.

Michael Lovendusky, vice president and associate general counsel with the American Council of Life Insurers, Washington, said there are sufficient protections within the IIPRC by-laws to allow them to make their own determinations when necessary.

Some states, including Ohio, Vermont and Virginia, said that they would oppose the motion for various reasons. For one thing, they recognized the need for a transition period so that more companies would be moved to file. They were also concerned that a review would delay the commission from accepting product filings.

Brendan Bridgeland, an NAIC-funded consumer with the Center for Insurance Research, Cambridge, Mass., said that the Pennsylvania suggestion should be considered.


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