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Life and Annuity Review Standards

Indiana Code 27-1-12-46 effective July 1, 2015 includes a new requirement that insurers provide a notice or disclosure regarding Medicaid on life insurance policies or certificates where proceeds may be designated for use in the purchase of funeral services or merchandise upon the death of the insured. If the newly required language is provided in a notice and reflects the language outlined in IC 27-1-12-46, the notice is not required to be filed with the Indiana Department of Insurance. If the disclaimer notice uses language other than that prescribed in IC 27-1-12-46, it should be submitted to the attention of Tina Korty, IDOI General Counsel, for review.
FILING ALERT!! Any carrier electing to use the new self-certification process and submitting their filing via SERFF, PLEASE inform us with a Note to Reviewer which indicates that this is a "Self-Certification Filing". Otherwise, it will be very difficult for us to know or identify that it is a "Self-Certification" filing from the bunches of filings we receive, which should be fast-tracked under this new option.

Note: You can find Indiana statutes at and Indiana regulations at Bulletins issued since July 1999 are on the Department’s website.

1. Annuities

IC 27-1-12.6-3Table of cash surrender values, if any, for 20 years (not applicable to variable, immediate, or flexible premium deferred annuities)
IC 27-1-12.6-4Prohibition against a provision that automatically Withdraws or places a loan against annuity forfeiture values in order to pay premiums on a life or annuity policy.
IC 27-1-12.6-510-day free look period. The policy can be returned to the company or the agent through whom it was purchased. The provision must be on the front cover.
IC 27-1-12.6-6Requires certain disclosures requirements if a cash value or death benefit is not provided.
IC 27-1-12.5-2(a)(3)Requires a statement of the mortality table, if any, and interest rate used to determine the nonforfeiture benefits and death benefits.
IC 27-1-12.5-2(a)(4)Requires a statement that the nonforfeiture values and death benefits are not less than that required by law.

2. Group Annuities

Bulletin 93Filing requirements.

3. Charitable and Gift Annuities

IC 27-1-12.4-2Exemption from regulation.

4. Individual and Joint Life

IC 27-1-12-6(11)The title of the policy (i.e. Term Life, Universal Life) must be on the face of the policy and the back of the policy. The back title page must face outward.
IC 27-1-12-43Under the “Free Look” provision the insured may return the policy to the insurer (the company), the agent who sold the policy, or to any other agent of the insurer. The free look provision must be on the front cover of the policy. All of the premium received must be refunded.
IC 27-1-12-6(10)There must be a provision that settlement will be done within two (2) months of receiving a death claim.
IC 27-1-12-7(b)Under either Cash Surrender or Cash Surrender Value, there should be a statement that if the policy is surrendered within thirty (30) days of a policy anniversary, the cash surrender value will not be less than the cash surrender value on that policy anniversary. (Does not apply to individual variable or universal policies)
IC 27-1-12-6(8)Company may not prohibit loans in the first policy year, they may not have a minimum loan amount or limit the amount of the loan to a certain percentage of the cash value. The loan value is the cash value minus the cost of insurance and the loan interest rate to the next anniversary. (Note: The exception is on variable universal life, it may have a minimum loan amount and the loan value may be up to 90% of the cash value).
IC 27-1-12-6(3)The limit on incontestability is two (2) years maximum.
IC 27-1-12-6(4)Misstatement of Age should state that the proceeds will be what the premium received would have purchased at the correct age or sex.
IC 27-1-12-6(2)There should be a grace period provision of thirty (30) days.
IC 27-1-12-35(a)(b)There must be a provision that interest will be paid if payment is not received in thirty (30) days. Interest will be from the date of death to the date of settlement.

5. Group Life

IC 27-1-12-41(1)A grace period provision of thirty one (31) days is required.
IC 27-1-12-41(2)The limit on incontestability is two (2) years maximum.
IC 27-1-12-41(3)A copy of application must be attached to the policy.
IC 27-1-12-41(4)Conditions under which the insurance company can ask for evidence of insurability.
IC 27-1-12-41(5)A provision specifying an equitable adjustment of premiums, and benefits in the event of misstatement of age.
IC 27-1-12-41(6)The death benefit must be payable to the beneficiary designated by the person insured.
IC 27-1-12-41(7)A provision that the insurer will issue to the policyholder, for delivery to each person insured, a certificate.
IC 27-1-12-41(8)

A provision that if the insurance, or any portion of it, on a person covered under the policy, or on the dependent of a person covered, ceases because of termination of employment or termination of membership in the class or classes eligible for coverage under the policy, the person or dependent is entitled, without evidence of insurability, to an individual policy of life insurance.

IC 27-1-12-41(9)

A provision that if the group policy terminates or is amended so as to terminate the insurance of any class of insured persons, every person insured under the policy at the date of the termination whose insurance terminates, including the insured dependent of a covered person, and who has been so insured for at least five (5) years before the termination date, is entitled to have issued by the insurer an individual policy of life insurance.

IC 27-1-12-41(10)

A provision that if a person insured under the group policy, or the insured dependent of a covered person, dies during the period within which the covered person or dependent would have been entitled to have an individual policy issued before such individual policy becomes effective, the claim will be payable under the group policy.

IC 27-1-12-41(11)

If active employment is a condition of insurance, a provision that an insured may continue coverage during the insured's total disability by timely payment to the policyholder.

IC 27-1-12-41(12)

In the case of a policy insuring the lives of debtors, a provision that the insurer will furnish to the policyholder, for delivery to each debtor insured under the policy, a certificate of insurance specifying that the death benefit will first be applied to reduce or extinguish the indebtedness.