Regulation of Charitable Gift Annuities
Degree of Regulation:
Issuance of charitable gift annuities is regulated under Hawaii Revised Statutes Section 431:1-204.
- Minimum assets - $200,000 in cash, cash equivalents or publicly-traded securities in HI.
- In state activity - continuous operation (program services or fundraising activity) in Hawaii for at least 10 years
- Reserve fund – segregated reserve fund required.
Actions Required for Exemption:
Application to the State Insurance Department is to be made prior to the issuance of any annuity in the state. Although there is not required state form, the charity must assert it meets the above qualifications and provide supporting documentation.
Disclosure and Agreement Content Requirements:
A charity is required to prominently include a notice to donor on the first page of the annuity agreement.
Suggested Language for State Disclosure: “A charitable gift annuity is not insurance under the laws of the State of Hawaii, is not subject to regulation by the State’s insurance division, and is not protected by any State guaranty fund.”
The segregated fund must maintain the sum of its reserves for all outstanding gift annuity agreements plus a surplus of the greater of: (i) $100,000; or (ii) 10% of its reserves. The reserves shall be calculated in accordance with mortality tables and discount rates as determined by the Commissioner of Insurance and within accepted actuarial standards. A deduction in reserves may be made for any portion of the annuity risk that is reinsured by an authorized insurer.
Investment Limitations - The segregated fund must be invested under Prudent Investor Rules.
Annual Reporting: Deadline for Submission
Annual filings must be submitted to the Department of the Attorney General. These filings renew the registration annually by providing the charity's most recent annual report and showing that its net worth and reserve requirements are in compliance. Hawaii provides an annual statement form.
Submission Deadline - Annual filing deadline – March 15
Links to State Regulations Pages:
Insurance Department Contact Information:
State of Hawaii Insurance Division
Department of Commerce and
P.O. Box 3614
Honolulu, HI 96811
Phone: (808) 586-2790