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Full-Text Articles in Securities Law
Insurance-Variable Annuities-Application Of Investment Company Act Of 1940, William C. Brashares
Insurance-Variable Annuities-Application Of Investment Company Act Of 1940, William C. Brashares
Michigan Law Review
Anticipating the sale of variable annuity contracts as a part of its regular business, Prudential, a life insurance company, applied to the Securities and Exchange Commission for complete exemption from the requirements of the Investment Company Act of 1940. Prudential claimed that it qualified for exemption as an insurance company under the definition of "insurance company" in the Investment Company Act ("a company ... whose primary and predominant business activity is the writing of insurance . . . and which is subject to supervision by the insurance commissioner or a similar official or agency of a state"). In the alternative, …
Regulation Of Business - Securities Act Of 1933 - Sec Loses Fight To Regulate Variable Annuity, William J. Wise S.Ed.
Regulation Of Business - Securities Act Of 1933 - Sec Loses Fight To Regulate Variable Annuity, William J. Wise S.Ed.
Michigan Law Review
The defendant, Variable Annuity Life Insurance Company, regulated as a life insurance company by the District of Columbia, issued a contract which it termed an annuity, but which differed from a conventional annuity in certain important respects. Ordinary annuity premiums are invested in debt securities while the premiums paid on the variable annuity are invested in common stocks. Further, instead of benefit payments in fixed dollar amounts, the variable annuity's benefits fluctuate since the value of the fund from which they are paid is affected by changing stock prices and dividend policies. The SEC, claiming these provisions brought the contract …