Provides that purchasers of dividend paying annuities shall be considered a separate class of annuitants from purchasers of annuities that do not pay dividends.
STATE OF NEW YORK
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9128--A
IN ASSEMBLY
January 31, 2022
___________
Introduced by M. of A. STERN -- read once and referred to the Committee
on Insurance -- committee discharged, bill amended, ordered reprinted
as amended and recommitted to said committee
AN ACT to amend the insurance law, in relation to authorizing dividend
paying deferred income annuities
The People of the State of New York, represented in Senate and Assem-bly, do enact as follows:
1 Section 1. Subparagraph (E) of paragraph 1 of subsection (a) of
2 section 4223 of the insurance law, as amended by chapter 864 of the laws
3 of 1985, is amended to read as follows:
4 (E) [A] (i) Except as provided in clause (ii) of this subparagraph, a
5 statement that the annuity benefits at the time of their commencement
6 will not be less than those that would be provided by the application of
7 an amount, hereinafter defined, to purchase any single consideration
8 immediate annuity contract offered by the company at the time to the
9 same class of annuitants. For contracts that provide cash surrender
10 benefits, such amount shall be the greater of the cash surrender benefit
11 or ninety-five percent of what the cash surrender benefit would be if
12 there were no withdrawal charge. For contracts that do not provide cash
13 surrender benefits, such amount shall be the present value of the paid-
14 up annuity benefit provided under the contract in accordance with
15 subsection (d) of this section.
16 [This statement will not affect the amount of any benefits required to
17 be provided under any other provision of this section.]
18 (ii) For paid-up deferred annuity contracts in which each consider-
19 ation paid into the contract purchases guaranteed paid-up annuity bene-
20 fits determined at the time the consideration is paid, a statement that
21 the annuity benefits at the time each consideration is paid will not be
22 less than those that would be provided by the application of the consid-
23 eration to current purchase rates for new sales of such contract or any
24 comparable paid-up deferred annuity contract offered by the company at
25 that time to the same class of annuitants. For purposes of this item,
26 dividends applied to purchase paid-up additions to the contract shall be
27 treated as considerations paid into the contract. This statement shall
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[] is old law to be omitted.
LBD14228-03-2
A. 9128--A 2
1 not affect the amount of any benefits required to be provided under any
2 other provision of this section.
3 § 2. Subsection (b) of section 3209 of the insurance law is amended by
4 adding a new paragraph 3 to read as follows:
5 (3) No participating dividend-paying paid-up deferred annuity contract
6 shall be delivered or issued for delivery in this state unless a
7 prospective purchaser is provided with a disclosure statement, no later
8 than at the time of application, containing the following:
9 (A) a statement indicating that dividends are not guaranteed under the
10 participating dividend-paying paid-up deferred annuity contract and the
11 income is therefore not guaranteed to increase from the dollar amount
12 set at the time of issue; and
13 (B) a statement indicating that the initial income under a participat-
14 ing dividend-paying paid-up deferred annuity contract may be lower than
15 the initial income under a fully guaranteed paid-up deferred annuity
16 contract.
17 § 3. This act shall take effect immediately.
