New York Life Declares 2022 Dividend Interest Rate

FROM NEW YORK LIFE…

New York Life declares largest dividend in company history, despite historically low interest rate environment

New York Life announced that the company has declared the largest dividend to eligible participating policy owners in company history. The company’s declared dividend includes a hold of our Dividend Interest Rate (DIR) at 5.8%.

Exceeding our guarantees to policy owners for 168 years

New York Life today announced that the company has declared a dividend of $1.9 billion to eligible participating policy owners in 2022, the largest in company history.

The ability to declare a dividend for a 168th consecutive year underscores New York Life’s commitment to financial strength, mutuality, and delivering ongoing value to policy owners. The company has paid in excess of $1 billion in dividends every year since 1990 and more than $44 billion in total dividend payouts over that time.

Complementing New York Life’s foundational life insurance franchise are strategic businesses that deliver diversified revenue streams. These revenues contribute to surplus, dividends, and earnings and can help mitigate the impact of today’s historically low interest rate environment.

Find out more about these changes from New York Life…

ProdMod: Understanding the Impact of the 7702 Transition on New York Life Whole Life Products

FROM NEW YORK LIFE…

We are excited to announce the introduction of New York Life’s AD121 Whole Life product suite. The new product suite will be available in all jurisdictions with an application Part I date of November 6, 2021 or later. AD121 Whole Life, Custom Whole Life, Custom Survivorship Whole Life, and Option to Purchase Paid-Up Additions Rider have been re-priced to reflect the current interest rate environment and to be compliant with updates made to Internal Revenue Code Section 7702 and nonforfeiture law. AD121 products are available to be Illustrated in NYLIS.

Overview of Product Changes

Whereas our current AD117 & AD119 Whole Life products in market use a 4% guaranteed cash value interest rate, AD121 Whole Life (WL), Custom Whole Life (CWL), Custom Survivorship Whole Life (CSWL), and the Option to Purchase Paid Up Additions (OPP) rider were re-priced using a 3% rate ensuring its continued compliance beyond 2021. As a result of this re-price, the following changes can be expected with AD121 products:

  • Modest premium increases at most issue ages on AD121 WL with more material premium increases across AD121 CWL and CSWL.
  • Increased early duration guaranteed cash values across AD121 products. Long-term, non-guaranteed cash value performance varies by product. Further details are outlined in each product section below.
  • Higher Modified Endowment Contract (MEC) limits allowing increased optionality and flexibility with case designs.
  • Variable Loan Interest Rate (VLIR) will have a minimum rate of 4.0% on AD121 products compared to 5.0% on in-market versions of the products.
  • OPP expense charge is lowered to 5% (currently 12%) for all Standard or better risk classes.

These are just a few of the highlights! For a more thorough summary of the impact of the transition to new 7702 interest rates, including expected performance changes, please see the formal announcement from New York Life.

Find out more about these changes from New York Life…

ProdMod: New York Life ECSV Rider Approved in CA

FROM NEW YORK LIFE…

The ECSV Rider provides an ECSV Benefit. The ECSV Benefit is available only during the ECSV Period, which is the first five policy years. When the ECSV Rider is active on the policy, the policyowner will be paid ECSV Benefit upon full surrender instead of the Total Cash Value (as defined in the policy). Upon full surrender, the ECSV Benefit provides an amount equal to the greater of a) and b), where:

a) Is equal to the ECSV Percentage multiplied by the cumulative premiums paid into the base policy and Dividend Option Term (DOT), if applicable, less any outstanding loans and accrued loan interest; and
b) Is the Cash Surrender Value which is equal to the Total Cash Value (as defined in the policy) less any outstanding policy loans and accrued loan interest. The ECSV Percentage used to determine the ECSV Benefit is 85%. The ECSV Percentage is guaranteed during the ECSV Period.

In order to be eligible to receive the ECSV Benefit, the following conditions must be satisfied:

  • The Base Policy must be in effect and not be in a Late Period
  • The Paid-Up Additional Insurance Dividend Option under the Base Policy must be in effect
  • The Base Policy Premium Payment Mode must not have been changed during the ECSV Period; and
  • The Paid-Up Additional Insurance under the Base Policy must not have been surrendered during the ECSV Period.

Find out more about these changes from New York Life…

ProdMod: New York Life’s Section 7702 Transition is On Deck

FROM NEW YORK LIFE…

Since the Consolidated Appropriations Act (CAA) was signed into law on December 27, 2020, we have been preparing to transition our life product portfolio to ensure continued compliance with all regulations. The CAA impacts the interest rates used in Internal Revenue Code (IRC) Section 7702 and Section 7702A. These interest rates are used in the calculation of Definition of Life Insurance (“DOLI”) testing and Modified Endowment Contract (“MEC”) premiums. Additionally, the allowable Nonforfeiture Interest Rate used to determine the minimum cash value on certain products has also changed. All products must be in compliance by January 1, 2022 and policies that do not comply cannot be issued in 2022.

Whole Life Suite to be updated in 2021

  • On November 6, 2021, AD121 Whole Life (WL), Custom Whole Life (CWL), and Custom Survivorship Whole Life (CSWL) will be introduced reflecting a new guaranteed cash value interest rate. A Network News will be published closer to the launch date of the new product series with full details.
  • With the launch of the new products, the Children’s Insurance (CI) rider will be discontinued. To issue a policy with a CI rider, the year-end processing rules outlined below must be followed.

Transition Rules

AD117 WL and CWL, and AD119 CSWL, cannot be issued in 2022. To issue all applicable AD117 WL and CWL, and AD119 CSWL policies by the end of the year the following deadlines have been established:

  • For AD117 WL and CWL, and AD119 CSWL, eLife applications must be signed/submitted by November 5, 2021. Applications with a Part I application date of November 6, 2021 or later will receive the AD121 series of the product.
  • A complete application package (Part 1 and 2), including all underwriting requirements, must be submitted and received by December 6, 2021 to position our underwriting teams to complete their review and issue these cases by year-end.
  • AD117 WL and CWL or AD119 CSWL policies cannot be issued after year end. No exceptions can be made.

Impact of 7702 Transition on Contractual Term Conversion Options

Original age term conversions (OATC) on term policies issued on or before November 5, 2021 will continue to be allowed to convert to an AD117 WL or CWL product on or after January 1, 2022. The contractual provision maintains the original term insurance issue date and makes available the WL product that was available for sale at that time.  Any term insurance issued on or after November 6, 2021 will have a contractual original age conversion privilege to AD121 products.

Find out more about these changes from New York Life…

ProdMod: New York Life Launches Enhanced Cash Surrender Value Rider

FROM NEW YORK LIFE…

The ECSV Rider provides an ECSV Benefit. The ECSV Benefit is available only during the ECSV Period, which is the first five policy years. When the ECSV Rider is active on the policy, the policyowner will be paid ECSV Benefit upon full surrender instead of the Total Cash Value (as defined in the policy). Upon full surrender, the ECSV Benefit provides an amount equal to the greater of a) and b), where:

a) Is equal to the ECSV Percentage multiplied by the cumulative premiums paid into the base policy and Dividend Option Term (DOT), if applicable, less any outstanding loans and accrued loan interest; and
b) Is the Cash Surrender Value which is equal to the Total Cash Value (as defined in the policy) less any outstanding policy loans and accrued loan interest. The ECSV Percentage used to determine the ECSV Benefit is 85%. The ECSV Percentage is guaranteed during the ECSV Period.

In order to be eligible to receive the ECSV Benefit, the following conditions must be satisfied:

  • The Base Policy must be in effect and not be in a Late Period
  • The Paid-Up Additional Insurance Dividend Option under the Base Policy must be in effect
  • The Base Policy Premium Payment Mode must not have been changed during the ECSV Period; and
  • The Paid-Up Additional Insurance under the Base Policy must not have been surrendered during the ECSV Period.

Find out more about these changes from New York Life…

Updated: Year-End Processing Deadlines for All Core Carriers Now Available

With just over three weeks left before 2021 is upon us, we now have the final year-end deadlines for 2020 business from all the AIN Core Carriers. Please review the list below for additional details for each insurance company,

Important: These deadlines may or may not reflect the transition rules regarding AG 49A. Please see AIN’s AG 49A Resource for those rules and deadlines.


The pertinent 2020 year-end cutoff dates for the AIN Core Carriers can be found via the links below.

ProdMod: New York Life Announces Sunset of Value Whole Life

FROM NEW YORK LIFE…

After a careful review and analysis of Value Whole Life, the decision has been made to discontinue the product at the end of the year. Given the current low interest rate environment, we would be required to make meaningful changes to the current pricing which would materially impact the product positioning within the whole life product suite.

AD117 Value Whole Life will continue to be available for sale in all jurisdictions through the end of the year. All applications must be submitted with an Application Part I date of December 31, 2020 or earlier. Value Whole Life applications with a Part I date of January 1, 2021 or later will not be accepted. Value Whole Life will no longer be available in eLife after December 31, 2020.

In Force Business

Our decision to discontinue this product will not impact in force Value Whole Life business. These in force policyowners will continue to have the features and policy provisions outlined in their contract available to them.

Find out more about these changes from New York Life…