Alabama Administrative Code
Title 482 - ALABAMA DEPARTMENT OF INSURANCE
Chapter 482-1-113 - ACCELERATED BENEFIT PROVISIONS OF INDIVIDUAL AND GROUP LIFE INSURANCE POLICIES
Section 482-1-113-.12 - Actuarial Disclosure and Reserves
Universal Citation: AL Admin Code R 482-1-113-.12
Current through Register Vol. 42, No. 11, August 30, 2024
(1) Actuarial Memorandum. A qualified actuary should describe the accelerated benefits, the risks, the expected costs and the calculation of statutory reserves in an actuarial memorandum accompanying each state filing. The insurer shall maintain in its files descriptions of the bases and procedures used to calculate benefits payable under these provisions. These descriptions shall be made available for examination by the commissioner upon request.
(2) Reserves
(a) When benefits are provided through the
acceleration of benefits under group or individual life policies or riders to
such policies, policy reserves shall be determined in accordance with the
Standard Valuation Law. All valuation assumptions used in constructing the
reserves shall be determined as appropriate for statutory valuation purposes by
a Member in good standing of the American Academy of Actuaries. Mortality
tables and interest currently recognized for life insurance reserves by the
NAIC may be used as well as appropriate assumptions for the other provisions
incorporated in the policy form. The actuary must follow both actuarial
standards and certification for good and sufficient reserves. Reserves in the
aggregate should be sufficient to cover:
1.
Policies upon which no claim has yet arisen.
2. Policies upon which an accelerated claim
has arisen.
(b) For
policies and certificates which provide actuarially equivalent benefits, no
additional reserves need to be established.
(c) Policy liens and policy loans, including
accrued interest, represent assets of the company for statutory reporting
purposes. For any policy on which the policy lien exceeds the policy's
statutory reserve liability such excess must be held as a non-admitted asset.
Author: Commissioner of Insurance
Statutory Authority: Code of Ala. 1975, § 27-2-17.
Disclaimer: These regulations may not be the most recent version. Alabama may have more current or accurate information. We make no warranties or guarantees about the accuracy, completeness, or adequacy of the information contained on this site or the information linked to on the state site. Please check official sources.
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