20-884. Valuation

317 words·~1 min read·/az/title-20/20-884

A research copy — for the controlling text, always check the official state or federal source. Not legal advice.

A. The standards of valuation for certificates that are issued before January 1, 1996 are the standards of valuation that were in effect immediately before January 1, 1995.

B. The minimum standards of valuation for certificates that are issued on or after January 1, 1996 shall be based on the following tables:

1. For certificates of life insurance: the commissioner's 1941 standard ordinary mortality table, the commissioner's 1941 standard industrial mortality table, the commissioner's 1958 standard ordinary mortality table, the commissioner's 1980 standard ordinary mortality table or a more recent table that applies to life insurers.

2. For annuity and pure endowment certificates, total and permanent disability benefits, accidental death benefits and noncancellable accident and health benefits: the tables that are authorized for use by like insurers in this state.

C. The tables listed under subsection B of this section shall be under the valuation methods and standards, including interest assumptions, that are in accordance with the laws of this state applicable to life insurers issuing policies containing like benefits.

D. The director may accept other standards for valuation if the director finds that the reserves produced by those standards will not be less in the aggregate than the reserves computed in accordance with the minimum valuation standards prescribed by this section. The director may vary the standards of mortality that apply to all benefit contracts on substandard lives or other extra hazardous lives issued by a society authorized to do business in this state.

E. With the consent of the insurance director in the domiciliary state of the society and under any conditions that the director of the department of insurance and financial institutions in this state may impose, a society may establish and maintain reserves on its certificates in excess of the reserves required by the standards of valuation, except that the contractual rights of a benefit member are not affected by the excess reserves.