LIFE INSURANCE POLICIES AND ANNUITY CONTRACTS
41-1941. annuity consumer protections — disclosures. (1) The provisions of this section shall apply to all group and individual annuity contracts and certificates except:
(a) Registered or nonregistered variable annuities or other registered products;
(b) Immediate and deferred annuities that contain no non-guaranteed elements; and
(c) Contracts excluded by section 41-1940(3), Idaho Code.
(2) If the application for an annuity contract is taken in a face-to-face meeting, the applicant, at or before the time of application and at the time of contract delivery, shall be given both the disclosure document and the buyer’s guide in the form prescribed by the director. The disclosure document shall be dated and signed by the prospective annuity owner and producer and the company shall maintain a signed copy for a period of five (5) years after the natural life of the contract.
(3) If the application for an annuity contract is taken by means other than in a face-to-face meeting, the applicant shall be sent both the disclosure document and the buyer’s guide at the time of application and at the time of contract delivery. The producer and the company shall maintain a signed copy of the disclosure document for a period of five (5) years after the natural life of the contract.
(4) A solicitation for an annuity contract provided in other than a face-to-face meeting shall include a statement that the proposed applicant may contact the insurer for a free annuity buyer’s guide.
(5) At a minimum, the following information shall be included in the disclosure document required to be provided under this section in a form or forms prescribed by the director or substantially similar to such form or forms:
(a) The generic name of the contract, the company product name, if different, the form number and the fact that it is an annuity;
(b) The insurer’s name and address;
(c) A description of the contract and its benefits, emphasizing its long-term nature and including the following examples where appropriate:
(i) The guaranteed, non-guaranteed and determinable elements of the contract, their limitations, if any, and an explanation of how they operate;
(ii) An explanation of the initial crediting rate, specifying any bonus or introductory portion, the duration of the rate and the fact that rates may change from time to time and are not guaranteed;
(iii) The periodic income options both on a guaranteed and non-guaranteed basis;
(iv) Any value reductions caused by withdrawals from or surrender of the contract;
(v) How values in the contract can be accessed;
(vi) The death benefit, if available, and how it will be calculated;
(vii) A summary of the federal tax status of the contract and any penalties applicable on withdrawal of values from the contract; and
(viii) The impact of any rider, such as a long-term care rider.
(d) The specific dollar amount or percentage charges and fees shall be listed with an explanation of how they apply;
(e) Information about the current guaranteed rate for new contracts that contains a clear notice that the rate is subject to change;
(f) Whenever projections for non-guaranteed elements of a contract are provided in the disclosure document, equal prominence shall be given to guaranteed elements; and
(g) Terms used in the disclosure document shall be defined in clear and concise language that facilitates the understanding of a typical person within the segment of the public to which the disclosure document is directed.
(6) For annuities in the payout period with changes in nonguaranteed elements and for the accumulation period of a deferred annuity, the insurer shall provide each contract owner with a report, at least annually, on the status of the contract. Such report shall contain at a minimum the following information:
(a) The beginning and end dates of the current report period;
(b) The accumulation and cash surrender value, if any, at the end of the previous report period and at the end of the current report period;
(c) The total amounts, if any, that have been credited, charged to the contract value or paid during the current report period; and
(d) The amount of outstanding loans, if any, as of the end of the current report period.
[41-1941, added 2010, ch. 238, sec. 1, p. 617; am. 2012, ch. 107, sec. 6, p. 290; am. 2020, ch. 290, sec. 1, p. 837; am. 2021, ch. 41, sec. 8, p. 121.]