Statutes, codes, and regulations
Rhode Island Administrative Code
Title 230 - Department of Business RegulationChapter 20 - InsuranceSubchapter 45 - Financial Standards and Corporate Operations
Part 8 - Life and Health Reinsurance Agreements (230-RICR-20-45-8)
Section 230-RICR-20-45-8.5 - Reserve Interest Rate Adjustment Formula

230 R.I. Code R. 230-RICR-20-45-8.5

Download
PDF
Current through November 7, 2024
Section 230-RICR-20-45-8.5 - Reserve Interest Rate Adjustment Formula
A. Pursuant to R.I. Gen. Laws § 27-4.2-3(a)(7)(ii), the associated formula for determining the reserve interest rate adjustment must use a formula which reflects the ceding company's investment earnings and incorporates all realized and unrealized gains and losses reflected in the statutory settlement. The following is an acceptable formula:

Rate = 2 (I + CG) / (X + Y - I - CG)

Where:

I is the net investment income (Exhibit 2 of the annual statement).

CG is the Capital Gains less Capital Losses (Exhibit 4 of the annual statement).

X is the current year cash and invested assets plus investment income due and accrued less borrowed money.

Y is the same as X but for the prior year.

230 R.I. Code R. 230-RICR-20-45-8.5