Section 2582.3 - Conditions(a) For each plan of insurance with separate rates for preferred and standard nonsmoker lives, an insurer may use the Super Preferred Nonsmoker, Preferred Nonsmoker, and Residual Standard Nonsmoker tables to substitute for the nonsmoker mortality table found in the 2001 CSO Mortality Table to determine minimum reserves. At the time of election and annually thereafter, except for business valued under the Residual Standard Nonsmoker Table, the appointed actuary shall certify that: (1) The present value of death benefits over the next ten years after the valuation date, using the anticipated mortality experience without recognition of mortality improvement beyond the valuation date for each class, is less than the present value of death benefits using the valuation basic table corresponding to the valuation table being used for that class.(2) The present value of death benefits over the future life of the contracts, using anticipated mortality experience without recognition of mortality improvement beyond the valuation date for each class, is less than the present value of death benefits using the valuation basic table corresponding to the valuation table being used for that class.(b) For each plan of insurance with separate rates for preferred and standard smoker lives, an insurer may use the Preferred Smoker and Residual Standard Smoker tables to substitute for the smoker mortality table found in the 2001 CSO Mortality Table to determine minimum reserves. At the time of election and annually thereafter, for business valued under the Preferred Smoker Table, the appointed actuary shall certify that: (1) The present value of death benefits over the next ten years after the valuation date, using the anticipated mortality experience without recognition of mortality improvement beyond the valuation date for each class, is less than the present value of death benefits using the preferred smoker valuation basic table corresponding to the valuation table being used for that class.(2) The present value of death benefits over the future life of the contracts, using anticipated mortality experience without recognition of mortality improvement beyond the valuation date for each class, is less than the present value of death benefits using the preferred smoker valuation basic table.(c) Unless specific approval is given by the commissioner of this state, the use of the 2001 CSO Preferred Class Structure Mortality Table shall not be permitted for the valuation of reserves in any statutory financial statement in which a company reports either of the following:(1) a deferred premium asset that is based on the valuation net premium, even when greater than the policy gross premium, and the reduction in the deferred premium asset resulting from reinsurance is based on the modal premium payments to the reinsurer, or(2) a reserve credit that exceeds the gross reserve, prior to the reduction for reinsurance, on the proportion of the policies reinsured.Cal. Code Regs. Tit. 10, § 2582.3
1. New section filed 12-31-2010; operative 12-31-2010 pursuant to Government Code section 11343.4 (Register 2010, No. 53). Note: Authority cited: Sections 10489.2 and 11136, Insurance Code. Reference: Sections 10489.2 and 11136, Insurance Code.
1. New section filed 12-31-2010; operative 12-31-2010 pursuant to Government Code section 11343.4 (Register 2010, No. 53).