New York Codes, Rules and Regulations
Title 11 - INSURANCE
Chapter XIII - Life Care Communities
Part 350 - Continuing Care Retirement Communities
Section 350.5 - Adjustments to reserves
Current through Register Vol. 46, No. 12, March 20, 2024
If the retrospective reserve liability calculated according to section 350.3(a)(1) of this Part is greater than the prospective reserve liability calculated according to section 350.3(a)(2) of this Part, then annually, upon a demonstration satisfactory to the superintendent, the retrospective reserve may be reduced in accordance with the priorities and conditions set forth in subdivisions (a), (b) and (c) of this section. The demonstration shall show that after such actions have been taken, the continuing care retirement community will continue to be in satisfactory actuarial balance, and the continuing care retirement community's projected invested assets will be at least equal to the requirements of section 350.6(a) of this Part for each of the next 10 projection years.
(a) If the earned surplus is negative, the retrospective reserve may be reduced by an amount not to exceed the lesser of:
(b) If earned surplus is positive and class 4 assets are not fully amortized, the retrospective reserve may be reduced by an amount not to exceed the lesser of:
(c) If earned surplus is positive and class 4 assets are fully amortized, the retrospective reserve may be reduced by an amount not to exceed one half of the excess of the retrospective reserve over the sum of the prospective reserve plus five percent of the portion of the prospective reserve calculated pursuant to section 350.3(a)(2)(iv) of this Part. There must be a reduction of scheduled fees, and/or additional services must be provided so that the sum of fee reductions plus the value of the additional services is at least as great as the reduction in the retrospective reserve under this paragraph.
