LRA Updates

JUDICIAL DEVELOPMENTS Athene vs. American General, et al. – COLI SVP Product Dispute On February 13, the Delaware Court of Chancery held oral arguments regarding ongoing litigation between Athene Life and Annuity Company, et al. (Plaintiffs) and American General Life Insurance Company (AGL), et al. (Defendants).

ACCOUNTING DEVELOPMENTS Whitepaper on BOLI SVP Accounting Implications On January 29, we published a whitepaper, Caveat Emptor: New BOLI SVP Features May Present Undesirable Accounting Implications, addressing potential accounting implications associated with various forms of BOLI stable value protection (SVP).

JUDICIAL DEVELOPMENTS COI Litigation Update – John Hancock Proposed Class Action Settlement As we have reported previously, John Hancock Life Insurance Company (U.S.A.) has agreed to settle class action complaints relating to its Cost of Insurance (COI) charges assessed under numerous life insurance policies. We have confirmed that one of the proposed settlements, 37 Besen…

TAX DEVELOPMENTS Brady Releases Tax, Oversight Legislation On November 26, House Ways and Means Committee Chairman Kevin Brady released a tax bill that included various retirement and other savings enhancements, legislation to redesign the IRS, and temporary tax relief for victims of certain natural disasters. The package also addresses tax extenders and includes some technical…

h4>REGULATORY DEVELOPMENTS IRS Releases Guidance on Uniform Mortgage-Backed Securities for Purposes of § 817(h) On October 16, the IRS released an advanced version of Revenue Procedure 2018-54, which provides guidance and procedural rules that allow taxpayers (i.e., issuers of variable contracts in this case) to elect to utilize a “deemed-issuer ratio” for “generic GSE securities”…

JUDICIAL DEVELOPMENTS COI Litigation Update – John Hancock Proposed Class Action Settlement Last month, we covered a proposed class action settlement involving John Hancock in the California Superior Courts (Barbara Larson vs. John Hancock Life Insurance Company). We have since learned of another class action lawsuit against John Hancock (“37 Besen Parkway”) that is pending…

TAX DEVELOPMENTS House Ways and Means Chairman Brady Release Tax Reform 2.0 Framework On July 24, House Ways and Means Committee Chairman Kevin Brady (R-TX) released a listening session framework for “Tax Reform 2.0.” The framework identifies a handful of priorities, including making the individual and small business tax cuts permanent, increasing tax incentives for…

LEGISLATIVE DEVELOPMENTS Economic Growth, Regulatory Relief, and Consumer Protection Act Signed into Law On May 22 the House passed the wide-ranging financial regulatory bill called the Economic Growth, Regulatory Relief, and Consumer Protection Act. This version of the legislation is unchanged compared to the bill that was passed by the Senate (S. 2155) on March…

TAX DEVELOPMENTS IRS Notice Regarding Information for Certain Life Insurance Contract Transactions On April 26, the IRS released Notice 2018-41, describing the new information reporting requirements for certain life insurance contracts under new IRC § 6050Y, which was added by the Tax Cuts and Jobs Act (TCJA).  The new reporting requirements apply to reportable death…

LEGISLATIVE DEVELOPMENTS Economic Growth, Regulatory Relief, and Consumer Protection Act Passes Senate On March 14, the Senate passed a wide-ranging financial regulatory bill (S. 2155) with significant bi-partisan support. Members of the House have indicated their intention to propose a series of amendments to the bill. It remains unclear if a revised version of the…