File: P4100-16
October 5, 1999
To: Chief Executive Officers and Chief Agents
Federally Regulated Life Insurance Companies and Fraternal Benefit Societies
Subject: Survey of Policy Contract Guarantees
The Office of the Superintendent of Financial Institutions (OSFI) is reviewing the financial impact on life insurers of guarantees provided in policy contracts, especially interest rate guarantees.
In order to obtain information on the extent and impact of guarantees, OSFI has developed the enclosed survey.
Information in the survey is not being requested on segregated funds or on products where the price has been fixed at issue, such as non-participating life insurance or immediate annuities. Information is being requested on products where a guarantee has been promised for a future event, such as the payment of a premium or the activation of a contract feature. Examples are guaranteed minimum interest rates for premiums on universal life, adjustable life and deferred annuities or for settlement options on any product. The survey also asks about the impact of other types of contract guarantees. The results of the survey will be used as input to the supervisory process for next year.
Please provide detailed responses to the enclosed survey by November 10, 1999. As per our normal practice, OSFI will respect the confidentiality of the information provided. Forward the responses to OSFI in one of the following formats:
A copy of the survey can also be obtained from the OSFI web site at www.osfi-bsif.gc.ca or by contacting Mr. Stéphane Dupel by e-mail at extcomm@osfi-bsif.gc.ca or by fax at (613) 952-8219.
Should you have any questions about the survey, please contact Gerry Stibbard at (416) 973-7010.
Nicholas Le Pan Deputy Superintendent Supervision