(a) A domestic life insurance company, including for the purposes of this section all domestic fraternal benefit societies that operate on a legal reserve basis, may establish one or more separate accounts and may allocate thereto amounts, including without limitation proceeds applied under optional modes of settlement or under dividend options, to provide for life insurance or life or period-certain annuities, and benefits incidental thereto, payable in fixed or variable amounts or both, or to accumulate funds that are paid to or held by such company pursuant to § 38a-459, subject to the following: (1) The income, gains and losses, realized or unrealized, from assets allocated to a separate account shall be credited to or charged against the account, without regard to other income, gains or losses of the company; (2) except as may be provided with respect to reserves for guaranteed benefits and funds referred to in subdivision (3) of this subsection, amounts allocated to any separate account and accumulations thereon may be invested and reinvested in any class of loans and investments, and such loans and investments shall not be included in applying the limitations provided in sections 38a-102 to 38a-102h, inclusive; (3) except with the approval of the commissioner and under such conditions as to investments and other matters as the commissioner may prescribe, which shall recognize the guaranteed nature of the benefits provided, reserves for (A) benefits guaranteed as to dollar amount and duration, and (B) funds guaranteed as to principal amount or stated rate of interest shall not be maintained in a separate account; (4) unless otherwise approved by the commissioner, assets allocated to a separate account shall be valued at their market value on the date of valuation, or if there is no readily available market, then as provided under the terms of the contract or the rules or other written agreement applicable to such separate account, provided, that unless otherwise approved by the commissioner, the portion, if any, of the assets of such separate account equal to the company’s reserve liability with regard to the guaranteed benefits and funds referred to in subdivision (3) of this subsection shall be valued in accordance with the rules otherwise applicable to the company’s assets; (5) amounts allocated to a separate account in the exercise of the power granted by this section shall be owned by the company and the company shall not be, nor hold itself out to be, a trustee with respect to such amounts. If, and to the extent so provided under the applicable contracts, that portion of the assets of any such separate account equal to the reserves and other contract liabilities with respect to such account shall not be chargeable with liabilities arising out of any other business the company may conduct; (6) no sale, exchange or other transfer of assets may be made by a company between any of its separate accounts or between any other investment account and one or more of its separate accounts unless, in case of a transfer into a separate account, such transfer is made solely to establish the account or to support the operation of the contracts with respect to the separate account to which the transfer is made, and unless such transfer, whether into or from a separate account, is made (A) by a transfer of cash, or (B) by a transfer of securities having a readily determinable market value, provided such transfer of securities is approved by the commissioner. The commissioner may approve other transfers among such accounts if, in the commissioner’s opinion, such transfers would not be inequitable; (7) to the extent such company deems it necessary to comply with any applicable federal or state laws, such company, with respect to any separate account, including without limitation any separate account that is a management investment account or a unit investment trust, may provide for persons having an interest therein appropriate voting and other rights and special procedures for the conduct or the business of such account, including without limitation special rights and procedures relating to investment policy, investment advisory services, selection of independent public accountants and the selection of a committee, the members of which need not be otherwise affiliated with such company, to manage the business of such account. The provisions of this subsection shall apply notwithstanding any inconsistent provision in the charter of any such domestic life insurance company or in the general statutes.

(b) Any contract providing benefits payable in variable amounts delivered or issued for delivery in this state shall contain a statement of the essential features of the procedures to be followed by the insurance company in determining the dollar amount of such variable benefits. Any such contract under which the benefits vary to reflect investment experience, including a group contract and any certificate in evidence of variable benefits issued thereunder, shall state that such dollar amount will so vary and shall contain on its first page a statement to the effect that the benefits thereunder are on a variable basis.

(c) Except to the extent permitted under § 38a-459, no domestic, foreign or alien insurance company or fraternal benefit society shall deliver or issue for delivery in this state any such contracts or annuities until the Insurance Commissioner licenses it to do so. Such annuities or other contracts and the sale thereof, and such insurance companies, shall be subject to the exclusive regulatory authority of the Insurance Commissioner and shall not be subject to The Connecticut Securities Act.

(d) Except for sections 38a-78 and 38a-440 in the case of a variable annuity contract and § 38a-78 in the case of a variable life insurance policy and except as otherwise provided herein, all pertinent provisions of sections 38a-61, 38a-77, 38a-78, 38a-81, 38a-82, 38a-284, 38a-287, 38a-430 to 38a-454, inclusive, and 38a-458 and, with respect to fraternal benefit societies, sections 38a-595 to 38a-626, inclusive, 38a-631 to 38a-640, inclusive, and 38a-800, shall apply to separate accounts and contracts relating thereto. The reserve liability for variable contracts shall be established in accordance with actuarial procedures that recognize the variable nature of the benefits provided and any mortality guarantees.

(e) The commissioner shall have power to enforce the provisions of this section, and may adopt, in accordance with the provisions of chapter 54, such regulations as he deems necessary for that purpose, covering, but not limited to, the form of life insurance or annuity contracts providing for benefits payable in fixed or variable amounts by domestic life insurance companies or domestic fraternal benefit societies operating on a legal reserve basis; separation of the assets of contract accounts; accounting of the income, gains and losses of contract accounts; distribution of the proceeds of accounts; sale, exchange or transfer of assets between accounts; guaranteed benefits; investment and reinvestment of contract or account assets, loans or investments; reserve liabilities; valuation of account assets; voting and other rights and special procedures affecting accounts, including investment policy, advisory services and the management, generally, of accounts.

(f) This section shall apply to policies issued by a company before the date of its election to comply with § 38-130e of the general statutes, revision of 1958, revised to 1981, or January 1, 1981, whichever occurred first.