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Insurance legislation and regulation in the states increasingly stems from model bills or regulations adopted by the National Association of Insurance Commissioners. The NAIC is currently considering a new model law and a model regulation that will have a strong impact on life insurance policy and annuity illustrations.
The purpose of the proposed statute--called the "Life Insurance Illustrations Model Act"--will be to authorize the insurance regulator (in states where the law does not already give the regulator the authority) to issue regulations designed to prevent misleading or incomplete illustrations of life insurance policies and annuity contracts. This model law is expected to be adopted by the NAIC at a meeting next month.
The regulations that insurance commissioners will issue under the authority granted by the law will be patterned after the NAIC model, which will establish...