Part III. Prevailing State Assumed Interest Rates — Products Issued in Years After 1982.

Schedule A

STATUTORY VALUATION INTEREST RATES BASED ON THE 1980 AMENDMENTS TO THE NAIC STANDARD VALUATION LAW

A. Life insurance valuation:

Guarantee Duration

(years) Calendar Year of Issue

1998

10 or fewer 5.50** More than 10 5.25** but not more than 20 More than 20 4.50**

Source: Rates calculated from the monthly averages, ending June 30, 1997, of Moody’s Corporate Bond Yield Average—Monthly Average Corporates.

** As the applicable federal interest rate for 1998 of 6.31 percent exceeds this prevailing state assumed interest rate, the interest rate to be used for this product under § 807 is 6.31 percent.

• The terms used in the schedules in this ruling and in Part III of Rev. Rul. 92-19 are those used in the Standard Valuation Law; the terms are defined in Rev. Rul. 92–19.

Part III, Schedule B

STATUTORY VALUATION INTEREST RATES BASED ON THE 1980 AMENDMENTS TO THE NAIC STANDARD VALUATION LAW

B. Single premium immediate annuities and annuity benefits involving life contingencies arising from other annuities with cash settlement options and from guaranteed interest contracts with cash settlement options:

Calendar Year of Issue Valuation Interest Rate

1997 6.75*

Source: Rates calculated from the monthly averages, ending June 30, 1997, of Moody’s Corporate Bond Yield Average — Monthly Average Corporates. The terms used in this schedule are those used in the Standard Valuation Law as defined in Rev. Rul. 92–19.

As this prevailing state assumed interest rate exceeds the applicable federal interest rate for 1997 of 6.33 percent, the prevailing state assumed interest rate of 6.75 percent is to be used for this product under § 807.

January 12, 1998 16 1998–2 I.R.B.

Part III, Schedule C15 - 1997

STATUTORY VALUATION INTEREST RATES BASED ON NAIC STANDARD VALUATION LAW FOR 1997 CALENDAR YEAR BUSINESS GOVERNED BY THE 1980 AMENDMENTS

C. Valuation interest rates for other annuities and guaranteed interest contracts that are valued on an issue year basis:

Cash Future Valuation Interest Rate Settlement Interest Guarantee Duration For Plan Type Options? Guarantee? (years) A B C

Yes Yes 5 or fewer 6.75 5.75* 5.25* More than 5, but not more than 10 6.50 5.75* 5.25* More than 10, but not more than 20 6.00* 5.25* 5.25* More than 20 5.25* 4.75* 4.75* Yes No 5 or fewer 7.00 6.00* 5.50* More than 5, but not more than 10 6.75 6.00* 5.50* More than 10, but not more than 20 6.25* 5.50* 5.25* More than 20 5.25* 5.00* 5.00* No Yes or No 5 or fewer 6.75 More than 5, but not more than 10 6.50 NOT APPLICABLE More than 10, but not more than 20 6.00* More than 20 5.25*

Source: Rates calculated from the monthly averages, ending June 30, 1997 of Moody’s Corporate Bond Yield Average—Monthly Average Corporates.

*As the applicable federal interest rate for 1997 of 6.33 percent exceeds this prevailing state assumed interest rate, the interest rate to be used for this product under § 807 is 6.33 percent.

Part III, Schedule D15—1997

STATUTORY VALUATION INTEREST RATES BASED ON NAIC STANDARD VALUATION LAW FOR 1997 CALENDAR YEAR BUSINESS GOVERNED BY THE 1980 AMENDMENTS

D. Valuation interest rates for other annuities and guaranteed interest contracts that are contracts with cash settlement options and that are valued on a change in fund basis:

Cash Future Valuation Interest Rate Settlement Interest Guarantee Duration For Plan Type Options? Guarantee? (years) A B C

Yes Yes 5 or fewer 7.50 7.00 5.50* More than 5, but not more than 10 7.25 7.00 5.50* More than 10, but not more than 20 6.75 6.50 5.25* More than 20 5.75* 5.75* 5.00* Yes No 5 or fewer 7.75 7.25 5.75* More than 5, but not more than 10 7.50 7.25 5.75* More than 10, but not more than 20 7.00 6.75 5.50* More than 20 6.00* 6.00* 5.25*

Source: Rates calculated from the monthly averages, ending June 30, 1997, of Moody’s Corporate Bond Yield Average—Monthly Average Corporates.

*As the applicable federal interest rate for 1997 of 6.33 percent exceeds this prevailing state assumed interest rate, the interest rate to be used for this product under § 807 is 6.33 percent.

1998–2 I.R.B 17 January 12, 1998