Provides that certain charitable annuities may be unisex in nature and shall be computed on the basis of currently applicable mortality tables for calculating the reserves for individual annuities; makes related provisions.
NEW YORK STATE ASSEMBLY MEMORANDUM IN SUPPORT OF LEGISLATION submitted in accordance with Assembly Rule III, Sec 1(f)
BILL NUMBER: A4599A
SPONSOR: Weprin TITLE OF BILL:
An act to amend the insurance law, in relation to certain charitable
annuities
PURPOSE OR GENERAL IDEA OF BILL:
The purpose of this legislation is to allow charities to use a single
table of unisex rates and a simpler calculation for maximum allowable
rates under New York statute
SUMMARY OF SPECIFIC PROVISIONS:
§ 1 amends section 1110 of article 11 of the insurance law to institute
unisex annuity rates and to establish a simplified calculation regard-
ing, the maximum allowable rates.
§ 2 establishes the effective date.
JUSTIFICATION:
In 2019 New York State adopted principle-based reserving. The result is
that DFS began to issue maximum payment rates for gift annuities that
differ from the recommended maximum by the American Council on Gift
Annuities, which has been recommending rates since 1927. DFS updates the
rates quarterly and the rate, schedules are gender based.
The gender-based rates plus the quarterly change in those rates creates
a complex, time consuming and expensive terrain for charities to navi-
gate. This bill would solve that problem by applying a single gender-
neutral standard and simplifying the way maximum allowable rates are
calculated
FISCAL IMPLICATIONS:
None to the state.
EFFECTIVE DATE:
This act shall take effect within 90 days of enactment
STATE OF NEW YORK
________________________________________________________________________
4599--A
2023-2024 Regular Sessions
IN ASSEMBLY
February 17, 2023
___________
Introduced by M. of A. WEPRIN -- read once and referred to the Committee
on Insurance -- committee discharged, bill amended, ordered reprinted
as amended and recommitted to said committee
AN ACT to amend the insurance law, in relation to certain charitable
annuities
The People of the State of New York, represented in Senate and Assem-bly, do enact as follows:
1 Section 1. Subsection (a) of section 1110 of the insurance law, as
2 amended by chapter 199 of the laws of 2004, is amended to read as
3 follows:
4 (a) The superintendent may, in his or her discretion, issue a special
5 permit to make annuity agreements with donors to any duly organized
6 domestic or foreign non-stock corporation or association conducted with-
7 out profit and engaged in active operation for at least ten years prior
8 thereto solely in bona fide charitable, religious, missionary, educa-
9 tional or philanthropic activities. The permit shall authorize such
10 corporation or association to receive gifts of cash and other property
11 conditioned upon, or in return for, its agreement to pay an annuity to
12 the donor, or his or her nominee, and to make and carry out such annuity
13 agreement. Every such corporation or association shall, before making
14 such agreement, file with the superintendent copies of its forms of
15 agreements with annuitants and a schedule of its maximum annuity rates,
16 which shall be computed [on the basis of the annuity standard adopted by
17 it for calculating its reserves] so as to return to it upon the
18 annuitant's death a residue at least equal to one-half the original gift
19 or other consideration for such annuity. The maximum annuity rates may
20 be unisex in nature and shall be computed on the basis of currently
21 applicable mortality tables for calculating the reserves for individual
22 annuities pursuant to section four thousand two hundred seventeen of
23 this chapter. The yield of the ten year treasury bond plus two percent
24 as of April thirtieth, rounded to the nearest 0.25%, shall be used to
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[] is old law to be omitted.
LBD07365-02-3
A. 4599--A 2
1 calculate the maximum annuity rates to become effective as of July first
2 of the same year and the ten year treasury bond yield plus two percent
3 as of October thirty-first, rounded to the nearest 0.25%, shall be used
4 to calculate the maximum annuity rates to become effective as of January
5 first of the following year. No other factors shall be used to calculate
6 the maximum annuity rates.
7 § 2. This act shall take effect on the ninetieth day after it shall
8 have become a law. Effective immediately, the addition, amendment
9 and/or repeal of any rule or regulation necessary for the implementation
10 of this act on its effective date are authorized to be made and
11 completed on or before such effective date.
