Section 132G. ''Contract on a variable basis'' for the purpose of this section shall mean any life policy or contract, annuity contract or any other policy or contract, whether on the group or individual basis, and any supplementary agreements relating thereto, issued by a life company providing for the amount of benefits or other contractual payments or values thereunder to vary, in whole or in part, so as to reflect the investment results of a separate investment account or accounts established under this section in which amounts received in connection with any such contract have been placed or, with the approval of the commissioner, to vary, in whole or in part, on some other basis fixed by the contract. No ''pension contract'' as defined in section one hundred and thirty-two F shall be subject to this section unless assigned by the life company to a separate investment account established under this section.

Any life company may issue contracts on a variable basis and, in connection with such contracts or in connection with contracts payable in whole or in part in fixed amounts or variable amounts, or a combination thereof, or for which the accumulation in whole or in part is guaranteed as to principal amount or stated rate of interest, may establish one or more separate investment accounts, hereinafter called ''separate accounts,'' independent of its general investment account. All amounts received by the life company which are required by a contract on a variable basis to be applied to provide variable benefits, payments or values thereunder shall be placed in the appropriate separate account or accounts. If, and to the extent so provided under the applicable, variable, fixed or guaranteed contracts, that portion of the assets of the separate account equal to the reserves and other contract liabilities with respect to the account shall not be chargeable with liabilities arising out of any other business the life company may conduct. The income, if any, and gains or losses, realized or unrealized, on each such separate account shall be credited to or charged against the amounts placed in such account without regard to the other income, gains or losses of the company. Amounts payable to the life company under any such variable, fixed or guaranteed contract may, with the consent of the life company, be paid by transferring investments to the life company.

Except as otherwise provided in clause (i) of following paragraph, assets in any separate account shall be valued at their market value at the date as of which valued in accordance with the terms of the applicable contracts, or if there is no readily available market, then in accordance with the terms of such contracts. Separate account assets and liabilities shall be included in the annual statement required by section twenty-five.

The life company's reserve liability for contracts on a variable basis shall be in accordance with actuarial procedures which recognize the variable nature of the benefits, payments or values to be provided. A contract on a variable basis may provide for benefits payable in fixed amounts and for values or funds guaranteed as to principal amount or stated rate of interest; provided, that to the extent, that the life company's reserve liability with respect to guaranteed benefits, values or funds is maintained in any separate account, either (i) a portion of the assets of such separate account at least equal to such reserve liability shall be invested in accordance with the requirements applicable to the life company's general investment account; provided, however, that such guaranteed separate account need not comply with the requirement of paragraph 14A of section sixty-three to the effect that not more than one-half of the reserve of any domestic stock or mutual life company shall be invested in corporate obligations authorized under said paragraph 14A, and shall be valued and computed as provided in section twenty-five or (ii) the insurer shall annually prepare an actuarial opinion that, after taking into account any risk charge payable from the assets of such separate account with respect to such guarantee, the assets in such separate account make good and sufficient provision for the fixed and guaranteed obligations of the insurer under any contract funded by such separate account, and such opinion shall be accompanied by a memorandum of the actuary providing the opinion describing the calculations made in support of such opinion and the assumptions used in the calculations. Such actuarial opinion and accompanying memorandum shall be maintained in the insurer's home office and be available for examination.

Any contract on a variable basis delivered or issued for delivery in this commonwealth shall contain a statement of the essential features of the procedure to be followed by the life company in determining the amount of variable benefits, payments or values thereunder. Any such contract, including a group contract and any certificate issued thereunder, shall state that the amount of variable benefits, payments or values thereunder may decrease or increase according to such procedure, and shall contain on its first page, in a prominent position, a statement that the benefits, payments or values thereunder are on a variable basis. Any such contract containing such statements shall be deemed to contain a distinct statement of the amount of benefits payable as required by section one hundred and eighteen.

No contract on a variable basis shall be issued or delivered in the commonwealth until a copy of the form thereof, including, in the case of a contract on a group basis, the form of any certificate evidencing variable benefits issued pursuant thereto, and any form of application for such contract, has been on file for thirty days with the commissioner unless before the expiration of such thirty days he shall have approved in writing the form of the contract; nor if the commissioner notifies the company in writing within said thirty days that in his opinion the form of the contract does not comply with the laws of the commonwealth, specifying his reasons therefor; provided that such action of the commissioner shall be subject to review by the supreme judicial court. The provisions of sections one hundred and ninety-three F, one hundred and ninety-three G and one hundred and ninety-three H shall apply to forms of contracts on a variable basis.

Notwithstanding any other provision of law, any domestic life company which establishes one or more separate accounts in connection with contracts on a variable basis may provide to the holders of interests in any such separate account voting rights with respect to the management of such separate account and the investment of assets therein, may establish for such separate account a committee, board or other body the members of which (1) may be elected solely by holders having such voting rights and (2) may or may not be otherwise affiliated with such life company, and may provide for compliance with any applicable state and federal law, in order that contracts on a variable basis may be lawfully sold or offered for sale.

Notwithstanding any other provision of law, any domestic life company may, with respect to any separate account it establishes and registers with the Securities and Exchange Commission as a unit investment trust, exercise voting rights in connection with any securities of a regulated investment company registered under the Federal Investment Company Act of 1940 in accordance with instructions from persons having interests in such account ratably as determined by the company.

No domestic life company, and no other life company admitted to transact business in this commonwealth, shall be authorized to issue or deliver within this commonwealth any contract on a variable basis until such company has satisfied the commissioner that its condition and methods of operation in connection with the issuance of such contracts will not be such as would render its operation hazardous to the public or its policyholders in this commonwealth. In determining the qualification of a company requesting authority to deliver such contracts within this commonwealth, the commissioner shall consider, among other things:

(1) The history and financial condition of the company;

(2) The character, responsibility and general fitness of the officers and directors of the company; and

(3) In the case of a company other than a domestic company, whether the regulation provided by its domiciliary jurisdiction provides a degree of protection to policyholders and the public which is substantially equal to that provided by this section and the rules and regulations issued thereunder.

Notwithstanding any other provisions of law, if the company is a subsidiary of an admitted life insurance company, or affiliated with such company through common management or ownership, it may be deemed by the commissioner to have satisfied the provisions of the preceding paragraph, and that part of section one hundred and fifty-three requiring that the company has been issuing life insurance policies or annuity contracts during each of at least the preceding three years, if either it or such admitted life company satisfies the aforementioned provisions; provided, however, that such admitted life company has a satisfactory record of doing business in this commonwealth for a period of at least three years.

The commissioner may issue such rules and regulations as may be necessary to carry out the provisions of this section. The provisions of chapter thirty A shall not be applicable to such rules and regulations.