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Chlora Lindley-Myers (Credit: Missouri Department of Insurance)

Life Health > Annuities > Variable Annuities

NAIC Task Force Adopts Index-Linked Variable Annuity Guidelines

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A panel of regulators at the National Association of Insurance Commissioners has adopted a set of standards for a popular, relatively new type of annuity — the registered index-linked annuity, or index-linked variable annuity.

Members of the Life Actuarial Task Force, part of the NAIC’s Life Insurance and Annuities Committee, approved Actuarial Guideline ILVA last week, in Tampa, Florida, during the NAIC’s fall national meeting. The guideline will apply to contracts issued on or after July 1, 2024, according to a draft of the guideline included in a task force document packet.

For regulators and annuity issues’ actuaries, the guideline will make it clear that the annuities are variable annuities and that, when the contracts are canceled early, the contracts provide benefits similar to those that might be provided by an ordinary variable annuity contract that was canceled early.

Because an ILVA contract (or RILA contract) ties returns to the performance of an investment index, rather than a basket of funds resembling mutual funds, the guideline talks about how to handle “interim values” tied to the value of a “hypothetical portfolio over the index strategy term,” rather than to the performance of a basket of mutual funds.

What It Means

For financial professionals and clients, the main impact of Actuarial Guideline ILVA may have to do with language.

Insurers have called the products everything from buffer annuities to structured annuities, to RILA contracts.

The industry might now move toward calling the products ILVA contracts, and also toward adopting other concepts and terms included in the guideline, such as using “hypothetical portfolio” to refer to a mechanism for determining the value of a contract when the contract owner takes cash out early.


U.S. federal law gives states responsibility for regulating the business of insurance. The NAIC is a group that helps insurance regulators in states and other types of U.S. jurisdictions, such as the District of Columbia and territories, discuss insurance regulations and coordinate their activities.

Other NAIC Actions

Also at the fall national meeting:

• The NAIC approved charges that call for the Index-Linked Variable Annuity Subgroup, to keep working on ILVA contract requirements.

• Members voted to confirm Missouri Insurance Director Chlora Lindley-Myers as the NAIC’s 2023 president; Connecticut Insurance Commissioner Andrew Mais as the president-elect; North Dakota Insurance Jon Godfread as the vice president, and Virginia Insurance Commissioner as the secretary-treasurer.

Pictured: Chlora Lindley-Myers. (Credit: Missouri Department of Insurance)


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