An insurer delivering or issuing for delivery in this state any variable life insurance contracts must deliver to the applicant for such contract and obtain a written acknowledgment of receipt from such applicant coincident with or before the execution of the application, the following information. The requirements of this section will be deemed to have been satisfied to the extent that a disclosure containing information required by this section is delivered, either in the form of a prospectus included in the requirements of 15 United States Code §77a, et seq., that was declared effective by the Securities and Exchange Commission; or all information and reports required by 29 United States Code §1001 et seq., if the policies are exempted from the registration requirements of 15 United States Code §77a, et seq.:
  (1) a summary explanation in nontechnical terms, of the principal features of the contract, including a description of how the variable benefits will reflect the investment experience of the separate account and the factors that affect such variation. Such explanation must include notices of the provision required by §4.1504(3)(A)(v) and (3)(F) of this title (relating to Insurance Contract and Filing Requirements);
  (2) a statement of the investment policy of the separate account, including:
    (A) a description of the investment objectives intended for the separate account and the principal types of investments intended to be made; and
    (B) any restrictions or limitations on how the operations of the separate account are intended to be conducted;
  (3) a statement of the net investment return of the separate account for each of the last 10 years or such lesser period as the separate account has been in existence;
  (4) a statement of the charges levied against the separate account during the previous year;
  (5) a summary of the method to be used in valuing assets held by the separate account;
  (6) a summary of the federal income tax aspects of the contract applicable to the insured, the contract holder, and the beneficiary;
  (7) illustrations of benefits payable under the variable life insurance contract. Such illustrations must be prepared by the insurer and may not include projections of past investment experience into the future or attempted predictions of future investments experience, provided that nothing contained herein prohibits use of hypothetical assumed rates of return to illustrate possible levels of benefits if it is made clear that such assumed rates are hypothetical only.

Source Note: The provisions of this §4.1507 adopted to be effective June 5, 1985, 10 TexReg 1676; transferred effective September 1, 2023, as published in the July 28, 2023, issue of the Texas Register, 48 TexReg 4127; amended to be effective January 24, 2024, 49 TexReg 250