Fund Transfers Use Cases – updated June 19, 2007

See track changes for what has changed since last version dated 3/9/07

Use Cases (yellow highlight indicates completed)

1 – Successful Scenario Cases

1A – Fund Transfer only and no arrangement updateon the contract

1B – Fund Transfer and a single arrangement update

  • A single arrangement update can comprise of the following activity types:
  • Dollar Cost Averaging
  • Asset Rebalancing
  • Asset Allocation
  • Systematic Withdrawal
  • Automatic Investment
  • Interest Credit
  • Standing Allocation
  • Special Dollar Cost Averaging update

1C – Fund Transfer and multiple arrangement updates

  • Examples of multiple arrangement updates can included (but not limited to) the following:
  • Standing Allocation and Dollar Cost Averaging
  • Asset Rebalancing and Systematic Withdrawal
  • Standing Allocations, Interest Credit and Automatic Investment

2 – Cancellations

2A – Fund Transfer submitted and then successfully cancelled prior to market close (same day cancel).

2B - Fund Transfer submitted before market close and cancel attempted after market close.

3 – Early Market Close (scheduled or unscheduled)

3A - Fund Transfer submitted after early market close.

3B - Fund Transfer submitted before early market close and cancel attempted after early market close.

4 – Fund Transfer rejected by Insurance Carrier on Day 1

4A – Rejected due to Fund Transfer not in good order, no arrangementupdate on contract

4B – Rejected due to Fund Transfer not in good order, Arrangement was in good order

4C – Rejected due to Fund Transfer in good order, Arrangement not in good order

4D – Rejected due to both Fund Transfer and Arrangement not in Good Order.

5 – Fund Transfer Day 2 confirm

5A – Day1 pending success, day 2 success(same as 1A)

5B – Day 1 pending success, day 2 failure

6 – Fund Transfer rejected by DTCC

6A – Distributor submitted – Rejected by DTCC due to edit rejects connectivity issues)

6B - Distributor submitted – Connectivity failure at the Carrier

6C – Carrier submitted – Rejected by DTCC due to edit rejects

6D – Carrier submitted – Connectivity failure at the Distributor

7 – Values Inquiry

7A – Carrier responds with successful values inquiry response.

7B – Carrier responds with a fail status and reject code

Assumptions

These apply to all uses cases. Additional assumptions that are applicable to a specific use case would be listed in that specific use case.

  1. Connectivity between carrier (distributor) and DTCC is available
  2. DTCC Participant Number and NAIC Numbers are available
  3. Product Profile (PPfA) and Positions and Values(POV) are up to date.
  4. Values Inquiry message will be used so agent gets most updated contract information prior to submitting fund transfer.
  5. Values Inquiry real-time is sent/received prior submission of fund transfer.
  6. Agent has ability to select contract and enter fund transfer transaction in Distributor system.
  7. Distributor operations / compliance will conduct either front-end or back end review of fund transfer.
  8. All data information is in good order.
  9. Selling Agreement Addendums are in place.
  10. Contract is active and available for fund transfer transactions.
  11. Distributor has time stamp procedures in place
  12. B/D vetted all internal rules in front-end
  13. Day 2 confirm is a batch file
  14. Any fail within messages will result in the entire transaction rejecting.

Use Case Definitions:

Fund Transfer process will use the ACORD TXLife XML standard model for messaging. Each message within the ACORD model has a message number. The use case will refer to the message number being transmitted.

ACORD TXLife 102 Message = Fund Transfer message

Use Case Diagram (based on Use Case 1A)


Item / Content
Use Case ID: / 1A
Description: / Success Scenario - Fund Transfer only and no arrangement update on the contract
Actors: /
  1. Distributor operations staff
  2. Distributor systems
  3. Carrier operations staff
  4. Carrier system
  5. DTCC systems (IPS validation)

Additional
Assumptions: / No Additional Assumptions Identified
Steps: /
  1. Distributor back office system transmits fund transfer TXLife 102message to DTCC.
  2. DTCC systems receivesmessage
  3. DTCC performs validation, finds no error in message and sends message to Carrier.
  4. Carrier receives fund transfer TXLife 102 message.
  5. Carrier performs pre-batch validations,
  6. Carrier finds no errors and responds with a Day 1 response pending success status.
  7. DTCC systems receives message,
  8. DTCC performs validation, finds no error in message and sends message to the Distributor.
  9. Distributor receives pending success status.
  10. Carrier processes fund transfer in its nightly batch cycle successfully.
  11. Carrier, next business day, sends a batch fund transfer TXLife 102message “success” confirmation to DTCC.
  12. DTCC system receives message.
  13. DTCC performs validation, finds no error in message and sends to Distributor.
  14. DTCC system sends TXLife 102message confirmation to Distributor.

Issues: / None Identified
Item / Content
Use Case ID: / 1B
Description: / Success Scenario - Fund Transfer and a single arrangement update
Actors: /
  1. Distributor operationsstaff
  2. Distributor systems
  3. Carrier operations staff
  4. Carrier system
  5. DTCC systems (IPS validation)

Assumptions: / No Additional Assumptions Identified
Steps: /
  1. Distributor back office system transmits fund transfer TXLife 102 message to DTCC.
  2. DTCC systems receives message, performs validation & finds no error in message
  3. DTCC system sends TXLife 102 message to Carrier.
  4. Carrier receives TXLife 102 message, performs pre-batch validations on bothfund transfer and arrangement update information, and finds no errors.
  5. Carrier responds with a Day 1 response pending success status on both TXLife 102 message.
  6. Carrier updates arrangement according to its internal process and processes the fund transfer in its nightly batch cycle successfully.
  7. Carrier, next business day, sends TXLife 102 message“success” confirmations to DTCC.
  8. DTCC systems receives message, performs validation & finds no error in message.
  9. DTCC system sends TXLife 102 message “success” confirmation to Distributor.

Issues: / None Identified
Item / Content
Use Case ID: / 1C
Description: / Success Scenario - Fund Transfer and multiple arrangementupdates
Actors: /
  1. Distributor operations staff
  2. Distributor systems
  3. Carrier operations staff
  4. Carrier system
  5. DTCC systems (IPS validation)

Assumptions: /
  1. Arrangement is allowed to be updated per the rules of the contract.

Steps: /
  1. Distributor back office system transmits fund transfer TXLife 102 which includes multiple arrangement updates to DTCC.
  2. DTCC systems receives message, performs validation & finds no error in message
  3. DTCC system sends TXLife 102 message to Carrier.
  4. Carrier receives TXLife 102 message, performs pre-batch validations on fund transfer and multiple arrangement updates and finds no errors.
  5. Carrier responds with a Day 1 response pending success status on TXLife 102 message.
  6. Carrier updates arrangementsaccording to its internal process and processes the fund transfer in its nightly batch cycle successfully.
  7. Carrier, next business day, sends TXLife 102 message “success” confirmations to DTCC.
  8. DTCC systems receives message, performs validation & finds no error in message.
  9. DTCC system sends TXLife 102 message “success” confirmations to Distributor.

Issues: / None Identified
Item / Content
Use Case ID: / 2A
Description: / Fund Transfer submitted and then successfully cancelled prior to market close (same day cancel).
Actors: /
  1. Agent of Distributor
  2. Distributor operations/suitability staff
  3. Distributor systems
  4. Carrier operations staff
  5. Carrier systems
  6. DTCC systems (IPS validation)

Assumptions: /
  1. Cancellation Transaction is time stamped prior to Market Close the same day that the original request is received.
  2. The transaction is received by the Carrier prior to the beginning of the Carrier’s batch cycle.

Steps: /
  1. Distributor back office system transmits fund transfer TXLife 102 message to DTCC.
  2. DTCC systems receives message, performs validation & finds no error in message.
  3. DTCC system sends fund transfer TXLife 102 message to Carrier.
  4. Carrier receives fund transfer TXLife 102 message, performs pre-batch validations, and finds no errors.
  5. Carrier responds with a Day 1 response pending success status.
  6. Carrier will pend fund transfer for nightly batch cycle processing.
  7. Agent or Distributor operations/suitability staff determines that there is need to cancel the Fund Transfer request
  8. Distributor systems sends fund transfer TXLife 102 message to DTCC, with a cancellation instruction.
  9. DTCC systems receives message, performs validation & finds no error in message.
  10. DTCC system sends fund transfer TXLife 102 cancel message to Carrier.
  11. Carrier receives fund transfer TXLife 102 cancel message, performs validations and finds no errors and cancels pending fund transfer.
  12. Carrier responds with a response cancel message success status to DTCC
  13. DTCC systems receives message, performs validation & finds no error in message
  14. DTCC transmits TXLife 102 Cancel message Distributor.

Notes: /
  1. If the transaction is delivered after the Carrier’s batch cycle then it will not be cancelled.
  2. Note: Carrier will not include this transaction in its next day batch confirmation file.

Item / Content
Use Case ID: / 2B
Description: / Fund Transfer submitted before market close and cancel attempted after market close.
Actors: /
  1. Agent of Distributor
  2. Distributor operations/suitability staff
  3. Distributor systems
  4. Carrier operations staff
  5. Carrier systems
  6. DTCC systems (IPS validation)

Assumptions: /
  1. Distributor did not block cancel from being sent after early market close.

Steps: /
  1. Distributor back office system transmits fund transfer TXLife 102 message to DTCC.
  2. DTCC systems receives message, performs validation & finds no error in message.
  3. DTCC system sends fund transfer TXLife 102 message to Carrier.
  4. Carrier receives fund transfer TXLife 102 message, performs pre-batch validations, and finds no errors.
  5. Carrier responds with a Day 1 response pending success status.
  6. Carrier will pend fund transfer for nightly batch cycle processing.
  7. Agent or Distributor operations/suitability staff determines that there is need to cancel the Fund Transfer request.
  8. Distributor systems sends fund transfer TXLife 102 message to DTCC, with a cancellation instruction after market close.
  9. DTCC systems receives message, performs validation & finds that time field is after 4 pm ET.
  10. DTCC system rejects TXLife 102 cancel message back to Distributor.

Notes: / Assuming no outside of system intervention, Carrier will process fund transfer in its nightly batch cycle and include transaction in its next day confirmation file.
Item / Content
Use Case ID: / 3A
Description: / Fund Transfer submitted after early market close.
Actors: /
  1. Distributor operations staff
  2. Distributor systems
  3. Carrier operations staff
  4. Carrier systems
  5. DTCC systems (IPS validation)

Assumptions: /
  1. Market is closing prior to 4 pm ET.
  2. DTCC’s normal processing procedures will stay in effect.
  3. Distributor did not block cancel from being sent after early market close.
  4. Carrier has integrated early market procedures into its process.

Steps: /
  1. Distributor back office system transmits fund transfer TXLife 102 message to DTCC after early market close.
  2. DTCC systems receives message, performs validation & finds no error in message.
  3. DTCC system sends fund transfer TXLife 102 message to Carrier.
  4. Carrier receives fund transfer TXLife 102 message, performs pre-batch validations, and finds that time submitted is after market close.
  5. Carrier responds with a Day 1 response failure status to DTCC.
  6. DTCC systems receives message, performs validation & finds no error in message.
  7. DTCC system sends fund transfer TXLife 102 response message to Distributor.

Notes: / None
Item / Content
Use Case ID: / 3B
Description: / Fund Transfer submitted before early market close and cancel attempted after early market close.
Actors: /
  1. Agent of Distributor
  2. Distributor operations/suitability staff
  3. Distributor systems
  4. Carrier operations staff
  5. Carrier systems
  6. DTCC systems (IPS validation)

Assumptions: /
  1. Distributor did not block cancel from being sent after early market close.

Steps: /
  1. Distributor back office system transmits fund transfer TXLife 102 message to DTCC.
  2. DTCC systems receives message, performs validation & finds no error in message.
  3. DTCC system sends fund transfer TXLife 102 message to Carrier.
  4. Carrier receives fund transfer TXLife 102 message, performs pre-batch validations, and finds no errors.
  5. Carrier responds with a Day 1 response pending success status.
  6. Carrier will pend fund transfer for nightly batch cycle processing.
  7. Agent or Distributor operations/suitability staff determines that there is need to cancel the Fund Transfer request.
  8. Distributor systems sends fund transfer TXLife 102 message to DTCC, with a cancellation instruction after early market close.
  9. DTCC systems receives message, performs validation & finds no errors.
  10. DTCC system sends TXLife 102 cancel message back to Carrier.
  11. Carrier receives fund transfer TXLife 102 cancel message, performs pre-batch validations, and finds that time submitted is after early market close.
  12. Carrier responds with a cancel message response failure status to DTCC.
  13. DTCC systems receives message, performs validation & finds no error in message.
  14. DTCC system sends fund transfer TXLife cancel 102 response message to Distributor.

Notes: / Assuming no outside of system intervention, Carrier will process fund transfer in its nightly batch cycle and include transaction in its next day confirmation file.
Item / Content
Use Case ID: / 4 A
Description: / Rejected due to Fund Transfer not in good order, no arrangement update on contract
Actors: /
  1. Distributor operations staff
  2. Distributor systems
  3. Carrier operations staff
  4. Carrier system
  5. DTCC systems (IPS validation)

Assumptions: / No Additional Assumptions Identified
Steps: /
  1. Distributor system transmits fund transfer TXLife102 message to DTCC.
  2. DTCC systems receives message, performs validation & finds no error in message
  3. DTCC system sends fund transfer TXLife 102 message to Carrier
  4. Carrier receives TX Life 102, performs pre-batch validations, and finds a pre-batch error condition (see Implementation guide for list of possible reject reasons).
  5. Carrier, same day, sends fund transfer 102 response message with a “reject” statusand reject reason(s)to DTCC.
  6. DTCC systems receives message, performs validation & finds no error in message
  7. DTCC system transmits fund transfer TXLife 102 response message to Distributor.

Issues: / None at this time.
Item / Content
Use Case ID: / 4B
Description: / Rejected due to Fund Transfer not in good order, Arrangement was in good order
Actors: /
  1. Distributor operations staff
  2. Distributor systems
  3. Carrier operations staff
  4. Carrier system
  5. DTCC systems (IPS validation)

Assumptions: / No additional assumptions
Steps: /
  1. Distributor system transmits fund transfer TXLife102, which includes an arrangement update to DTCC.
  2. DTCC systems receives message, performs validation & finds no error in message
  3. DTCC system sends 102 andmessage to Carrier.
  4. Carrier receives 102message, performs pre-batch validations on both fund transfer and arrangement update information, and finds a pre-batch error condition (see Implementation guide for list of possible reject reasons) with the fund transfer. Carrier does not find an error condition with the arrangement update.
  5. Carrier, same day, sends fund transfer 102 message “reject” confirmation to DTCC. The 102 message may have one or morewill have a single reject reasons which points to the fund transfer.
  6. DTCC systems receives message, performs validation & finds no error in message
  7. DTCC system transmits 102 response message to the Distributor.

Notes: / Carriers can will only send one or more reject reasons for the fund transfer info and one or more reject reasons per arrangement update in the 102 message, if applicable. Multiple reasons for the fund transfer information or a single arrangement update are not permitted.
Item / Content
Use Case ID: / 4C
Description: / Rejected due to Fund Transfer in good order, Arrangement not in good order
Actors: /
  1. Distributor operations staff
  2. Distributor systems
  3. Carrier operations staff
  4. Carrier system
  5. DTCC systems (IPS validation)

Assumptions: / No additional assumptions
Steps: /
  1. Distributor system transmits fund transfer TXLife102, which includes arrangement update information, to DTCC.
  2. DTCC systems receives message, performs validation & finds no error in message
  3. DTCC system sends 102 to Carrier.
  4. Carrier receives 102 message, performs pre-batch validations on both fund transfer and arrangement update information, and finds a pre-batch error condition (see Implementation guide for list of possible reject reasons) with the arrangement update. Carrier does not find an error condition with the actual fund transfer message.
  5. Carrier, same day, sends fund transfer 102 message “reject” confirmation to DTCC. The 102 message will have one or morea single reject reasons which points to the arrangement update that was NIGO.
  6. DTCC systems receives message, performs validation & finds no error in message
  7. DTCC system transmits 102 response messages to the Distributor.

Notes: / Carriers can send one or more reject reasons for the fund transfer info and one or more reject reasons per arrangement update in the 102 message, if applicable. Carriers will only send one reject reason for the fund transfer info and one reject reason per arrangement update in the 102 message, if applicable. Multiple reasons for the fund transfer information or a single arrangement update are not permitted.
Item / Content
Use Case ID: / 4D
Description: / Rejected due to both Fund Transfer and Arrangement not in Good Order
Actors: /
  1. Distributor operations staff
  2. Distributor systems
  3. Carrier operations staff
  4. Carrier system
  5. DTCC systems (IPS validation)

Assumptions: / No additional assumptions
Steps: /
  1. Distributor system transmits fund transfer TXLife102, which includes arrangement update information, to DTCC.
  2. DTCC systems receives message, performs validation & finds no error in message
  3. DTCC system sends 102 message to Carrier.
  4. Carrier receives 102 message, performs pre-batch validations in both messages, and finds a pre-batch error condition (see Implementation guide for list of possible reject reasons) with both the fund transfer and the arrangement update.
  5. Carrier, same day, sends fund transfer 102 message “reject” confirmation to DTCC. The Carrier will send a minimum of two reject reasons to the Distributor, at least one occurrence for the fund transfer and at least one occurrence for the arrangement update. Carrier may send multiple rejects reasons if applicable.
  6. DTCC systems receives message, performs validation & finds no error in message
  7. DTCC system transmits 102 response messages to the Distributor.