Due to the fact that market interest rates have been declining over a period of about five years now, the maximum valuation interest rate that can be used to calculate statutory reserves for policies of life insurance is probably going to decrease from the current rate of 4.5 percent for a long term life insurance contract to about 4 percent. When this change finally does occur, carriers are going to have to use a 4 percent or lower rate of interest when calculating the statutory reserves for long-guaranteed duration life insurance policies, including both whole life insurance …

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