Chapter 05 Valuation Standards for Group Annuity and Pure Endowment Contracts

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Code of Maryland Regulations

Title 31 MARYLAND INSURANCE ADMINISTRATION

Subtitle 05 ASSETS, LIABILITIES, RESERVES, AND INVESTMENTS OF INSURERS

Chapter 05 Valuation Standards for Group Annuity and Pure Endowment Contracts

Code of Maryland Regulations

Chapter 05 Valuation Standards for Group Annuity and Pure Endowment Contracts

Administrative History Effective date: December 31, 1985 (12:26 Md. R. 2545) —————— Chapter recodified from COMAR 09.30.69 to COMAR 31.05.05 effective September 7, 1998 (25:18 Md. R. 1439) Chapter revised effective May 24, 2004 (31:10 Md. R. 796) Authority Insurance Article, §2-109 and Title 5, Subtitle 3, Annotated Code of Maryland

.01 Purpose. The purpose of this chapter is to approve the use of new mortality tables adopted by the National Association of Insurance Commissioners after 1980 as a basis for determining the minimum standards of valuation of annuities and pure endowments purchased under group annuity and pure endowment contracts.

.02 Definitions. A. In this chapter, the following terms have the meanings indicated. B. Terms Defined. (1) "1983 GAM Tables" means the mortality tables: (a) Developed by the Society of Actuaries Committee on Annuities; (b) Adopted as a recognized mortality table for annuities in December 1983 by the National Association of Insurance Commissioners; and (c) Set out in Regulation .03 of this chapter . (2) "1983 Table "a" means the mortality table: (a) Developed by the Society of Actuaries Committee to Recommend a New Mortality Basis for Individual Annuity Valuation; (b) Adopted as a recognized mortality table for annuities in June 1982 by the National Association of Insurance Commissioners; and (c) Set out in COMAR 31.05.04.03 . (3) "1994 GAR Table" means the mortality table: (a) Developed by the Society of Actuaries Group Annuity Valuation Table Task Force; and (b) Set out in Regulation .04 of this chapter .

.03 1983 GAM Tables. A. 1983 GAM TABLE—MALES.

1983 GAM TABLE—MALES

Age q

5 .000342

6 .000318

7 .000302

8 .000294

9 .000292

10 .000293

11 .000298

12 .000304

13 .000310

14 .000317

15 .000325

16 .000333

17 .000343

18 .000353

19 .000365

20 .000377

21 .000392

22 .000408

23 .000424

24 .000444

25 .000464

26 .000488

27 .000513

28 .000542

29 .000572

30 .000607

31 .000645

32 .000687

33 .000734

34 .000785

35 .000860

36 .000907

37 .000966

38 .001039

39 .001128

40 .001238

41 .001370

42 .001527

43 .001715

44 .001932

45 .002183

46 .002471

47 .002790

48 .003138

49 .003513

50 .003909

51 .004324

52 .004755

53 .005200

54 .005660

55 .006131

56 .006618

57 .007139

58 .007719

59 .008384

60 .009158

61 .010064

62 .011133

63 .012391

64 .013868

65 .015592

66 .017579

67 .019804

68 .022229

69 .024817

70 .027530

71 .030354

72 .033370

73 .036680

74 .040388

75 .044597

76 .049388

77 .054758

78 .060678

79 .067125

80 .074070

81 .081484

82 .089320

83 .097525

84 .106047

85 .114836

86 .124170

87 .133870

88 .144073

89 .154859

90 .166307

91 .178214

92 .190460

93 .203007

94 .217904

95 .234086

96 .248436

97 .263954

98 .280803

99 .299154

100 .319185

101 .341086

102 .365052

103 .393102

104 .427255

105 .469531

106 .521945

107 .586518

108 .665268

109 .760215

110 1.000000

B. 1983 GAM TABLE—FEMALES.

1983 GAM TABLE—FEMALES

Age q

5 .000171

6 .000140

7 .000118

8 .000104

9 .000097

10 .000096

11 .000104

12 .000113

13 .000121

14 .000131

15 .000140

16 .000149

17 .000159

18 .000169

19 .000179

20 .000189

21 .000201

22 .000212

23 .000225

24 .000238

25 .000253

26 .000268

27 .000283

28 .000301

29 .000320

30 .000342

31 .000364

32 .000388

33 .000414

34 .000443

35 .000476

36 .000502

37 .000535

38 .000573

39 .000617

40 .000665

41 .000716

42 .000775

43 .000841

44 .000919

45 .001010

46 .001117

47 .001237

48 .001366

49 .001505

50 .001647

51 .001793

52 .001948

53 .002119

54 .002315

55 .002541

56 .002803

57 .003103

58 .003442

59 .003821

60 .004241

61 .004702

62 .005210

63 .005769

64 .006385

65 .007064

66 .007817

67 .008681

68 .009702

69 .010921

70 .012385

71 .014128

72 .016159

73 .018481

74 .021091

75 .023992

76 .027184

77 .030672

78 .034459

79 .038549

80 .042945

81 .047655

82 .052691

83 .058071

84 .063807

85 .069918

86 .076570

87 .084459

88 .091935

89 .101354

90 .111750

91 .123076

92 .135630

93 .149577

94 .165103

95 .182419

96 .201757

97 .222043

98 .243899

99 .268185

100 .295187

101 .325225

102 .358897

103 .395842

104 .438360

105 .487816

106 .545886

107 .614309

108 .694884

109 .789474

110 1.000000

.04 1994 GAR Table.

Male Female

Age (x) qx1994 AAx qx1994 AAx

1 0.000592 0.020 0.000531 0.020

2 0.000400 0.020 0.000346 0.020

3 0.000332 0.020 0.000258 0.020

4 0.000259 0.020 0.000194 0.020

5 0.000237 0.020 0.000175 0.020

6 0.000227 0.020 0.000163 0.020

7 0.000217 0.020 0.000153 0.020

8 0.000201 0.020 0.000137 0.020

9 0.000194 0.020 0.000130 0.020

10 0.000197 0.020 0.000131 0.020

11 0.000208 0.020 0.000138 0.020

12 0.000226 0.020 0.000148 0.020

13 0.000255 0.020 0.000164 0.020

14 0.000297 0.019 0.000189 0.018

15 0.000345 0.019 0.000216 0.016

16 0.000391 0.019 0.000242 0.015

17 0.000430 0.019 0.000262 0.014

18 0.000460 0.019 0.000273 0.014

19 0.000484 0.019 0.000280 0.015

20 0.000507 0.019 0.000284 0.016

21 0.000530 0.018 0.000286 0.017

22 0.000556 0.017 0.000289 0.017

23 0.000589 0.015 0.000292 0.016

24 0.000624 0.013 0.000291 0.015

25 0.000661 0.010 0.000291 0.014

26 0.000696 0.006 0.000294 0.012

27 0.000727 0.005 0.000302 0.012

28 0.000754 0.005 0.000314 0.012

29 0.000779 0.005 0.000331 0.012

30 0.000801 0.005 0.000351 0.010

31 0.000821 0.005 0.000373 0.008

32 0.000839 0.005 0.000397 0.008

33 0.000848 0.005 0.000422 0.009

34 0.000849 0.005 0.000449 0.010

35 0.000851 0.005 0.000478 0.011

36 0.000862 0.005 0.000512 0.012

37 0.000891 0.005 0.000551 0.013

38 0.000939 0.006 0.000598 0.014

39 0.000999 0.007 0.000652 0.015

40 0.001072 0.008 0.000709 0.015

41 0.001156 0.009 0.000768 0.015

42 0.001252 0.010 0.000825 0.015

43 0.001352 0.011 0.000877 0.015

44 0.001458 0.012 0.000923 0.015

45 0.001578 0.013 0.000973 0.016

46 0.001722 0.014 0.001033 0.017

47 0.001899 0.015 0.001112 0.018

48 0.002102 0.016 0.001206 0.018

49 0.002326 0.017 0.001310 0.018

50 0.002579 0.018 0.001428 0.017

51 0.002872 0.019 0.001568 0.016

52 0.003213 0.020 0.001734 0.014

53 0.003584 0.020 0.001907 0.012

54 0.003979 0.020 0.002084 0.010

55 0.004425 0.019 0.002294 0.008

56 0.004949 0.018 0.002563 0.006

57 0.005581 0.017 0.002919 0.005

58 0.006300 0.016 0.003359 0.005

59 0.007090 0.016 0.003863 0.005

60 0.007976 0.016 0.004439 0.005

61 0.008986 0.015 0.005093 0.005

62 0.010147 0.015 0.005832 0.005

63 0.011471 0.014 0.006677 0.005

64 0.012940 0.014 0.007621 0.005

65 0.014535 0.014 0.008636 0.005

66 0.016239 0.013 0.009694 0.005

67 0.018034 0.013 0.010764 0.005

68 0.019859 0.014 0.011763 0.005

69 0.021729 0.014 0.012709 0.005

70 0.023730 0.015 0.013730 0.005

71 0.025951 0.015 0.014953 0.006

72 0.028481 0.015 0.016506 0.006

73 0.031201 0.015 0.018344 0.007

74 0.034051 0.015 0.020381 0.007

75 0.037211 0.014 0.022686 0.008

76 0.040858 0.014 0.025325 0.008

77 0.045171 0.013 0.028366 0.007

78 0.050211 0.012 0.031727 0.007

79 0.055861 0.011 0.035362 0.007

80 0.062027 0.010 0.039396 0.007

81 0.068615 0.009 0.043952 0.007

82 0.075532 0.008 0.049153 0.007

83 0.082510 0.008 0.054857 0.007

84 0.089613 0.007 0.060979 0.007

85 0.097240 0.007 0.067738 0.006

86 0.105792 0.007 0.075347 0.005

87 0.115671 0.006 0.084023 0.004

88 0.126980 0.005 0.093820 0.004

89 0.139452 0.005 0.104594 0.003

90 0.152931 0.004 0.116265 0.003

91 0.167260 0.004 0.128751 0.003

92 0.182281 0.003 0.141973 0.003

93 0.198392 0.003 0.155931 0.002

94 0.215700 0.003 0.170677 0.002

95 0.233606 0.002 0.186213 0.002

96 0.251510 0.002 0.202538 0.002

97 0.268815 0.002 0.219655 0.001

98 0.285277 0.001 0.237713 0.001

99 0.301298 0.001 0.256712 0.001

100 0.317238 0.001 0.276427 0.001

101 0.333461 0.000 0.296629 0.000

102 0.350330 0.000 0.317093 0.000

103 0.368542 0.000 0.338505 0.000

104 0.387855 0.000 0.361016 0.000

105 0.407224 0.000 0.383597 0.000

106 0.425599 0.000 0.405217 0.000

107 0.441935 0.000 0.424846 0.000

108 0.457553 0.000 0.444358 0.000

109 0.473150 0.000 0.464469 0.000

110 0.486745 0.000 0.482325 0.000

111 0.496356 0.000 0.495110 0.000

112 0.500000 0.000 0.500000 0.000

113 0.500000 0.000 0.500000 0.000

114 0.500000 0.000 0.500000 0.000

115 0.500000 0.000 0.500000 0.000

116 0.500000 0.000 0.500000 0.000

117 0.500000 0.000 0.500000 0.000

118 0.500000 0.000 0.500000 0.000

119 0.500000 0.000 0.500000 0.000

120 1.000000 0.000 1.000000 0.000

.05 Valuation Standards. A. In valuing the reserve liabilities for annuities and pure endowments purchased under group annuity and pure endowment contracts in accordance with the provisions of Insurance Article, §5-305(f), Annotated Code of Maryland , insurers may use either the 1971 Group Annuity Mortality Table, the 1983 GAM Tables shown in Regulation .03 of this chapter , or the 1983 Table "a" shown in COMAR 31.05.04.03 for annuities and pure endowments purchased on or after July 1, 1980, and before January 1, 1987. B. Except as provided in §§C and D of this regulation, the 1983 GAM Tables are to be used by insurers in valuing reserve liabilities in accordance with the provisions of Insurance Article, §5-305(f), Annotated Code of Maryland , for annuities and pure endowments purchased on and after January 1, 1987, under group annuity and pure endowment contracts. C. Except as provided in §D of this regulation , either the 1983 GAM Table or the 1994 GAR Table shall be used for determining the minimum standard of valuation for any annuity or pure endowment purchased on or after July 1, 2004 under a group annuity or pure endowment contract. D. The 1994 GAR Table shall be used for determining the minimum standard of valuation for any annuity or pure endowment purchased on or after July 1, 2005 under a group annuity or pure endowment contract.

.06 Application of the 1994 GAR Table. In using the 1994 GAR Table, the mortality rate for a person age X in year (1994 + n) is calculated as follows: q x 1994+n = q x 1994 (1-AA x ) n where the q x 1994 and AA x s are as specified in the 1994 GAR Table.

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