CHAPTER 11. USE OF A CLOSED BLOCK
IC 27-15-11
Chapter 11. Use of a Closed Block
IC 27-15-11-1
Applicability of chapter
Sec. 1. This chapter applies if a closed block is used for the
preservation of the reasonable dividend expectations of eligible
members and other policyholders.
As added by P.L.94-1999, SEC.3.
IC 27-15-11-2
Preparation of written plan of operation
Sec. 2. The converting mutual shall prepare a written plan of
operation for the closed block, consistent with the requirements of
this article.
As added by P.L.94-1999, SEC.3.
IC 27-15-11-3
Operation of closed block; nonreversion of assets
Sec. 3. The closed block shall be operated for the exclusive
benefit of policies and contracts included in it. No costs or expenses
incurred in connection with the conversion shall be charged to the
closed block. Subject to termination of the closed block under
section 7 of this chapter, none of the assets allocated to the closed
block or the revenue derived from those assets may revert to the
benefit of the stockholders of the former mutual or any parent
company.
As added by P.L.94-1999, SEC.3.
IC 27-15-11-4
Sufficiency of assets
Sec. 4. The assets allocated to the closed block, together with the
revenue from the closed block, must be reasonably sufficient to:
(1) support the business in the closed block until the time the
last policy in the closed block has terminated, including
payment of claims and those expenses and taxes as are specified
in the plan of conversion; and
(2) provide for:
(A) continuation of dividend scales in effect on the date the
board of directors adopted the resolution proposing the plan
of conversion, if the experience underlying those scales
continues; and
(B) appropriate adjustments in the scales if the experience
changes.
As added by P.L.94-1999, SEC.3.
IC 27-15-11-5
Designation of assets
Sec. 5. The assets assigned to a closed block shall be specified in
the plan of operation and must consist of:
(1) a list of designated assets of the converting mutual's general
account or specified segments of the converting mutual's
general account, which list shall change periodically to reflect
the acquisition and disposition of assets;
(2) a designated portion of each and every asset of the
converting mutual's general account or specified segments of
the converting mutual's general account, which portion shall
change periodically to reflect the cash flows of the closed
block; or
(3) assets designated by a combination of the methods described
in this section.
As added by P.L.94-1999, SEC.3.
IC 27-15-11-6
Methods for assignment or designation of assets
Sec. 6. The plan of operation must specify the following:
(1) The method of assignment of closed block assets referred to
in section 5 of this chapter that is being used.
(2) The methods by which the designations of assets or portions
of assets are changed during the course of closed block
operations.
As added by P.L.94-1999, SEC.3.
IC 27-15-11-7
Conditions for ceasing maintenance of closed block
Sec. 7. The plan of operation must provide for the conditions
under which the former mutual, with the approval of the
commissioner, may cease to maintain the closed block.
As added by P.L.94-1999, SEC.3.
IC 27-15-11-8
Annual reports and reviews of former mutual
Sec. 8. The former mutual shall:
(1) submit to the commissioner annual reports, in a form
acceptable to the commissioner, that account for and describe
the operations of the closed block; and
(2) as specified in the plan of operation, provide at least every
three (3) years for reviews of, and reports and opinions on, the
closed block by an independent actuary, unless otherwise
directed by the commissioner.
As added by P.L.94-1999, SEC.3.