Statutory Requirements
Standards set by the various state regulatory authorities that determine how financial statements must be prepared for regulators. The states are responsible for making certain that insurers will remain solvent and have enough set aside in reserves to pay future claims. To this end, they have devised statutory accounting principles that govern insurance company reporting. These requirements differ from generally accepted accounting principles (gaap). Among other things, statutory requirements include the setting of statutory reserves, and the immediate expensing of the cost of acquiring new business, rather than allowing insurers to spread the exposure over the life of the policy.
Popular Insurance Terms
Trust instrument that permits the owner of a residence (grantor) to transfer ownership of that residence with the grantor still being allowed to stay in that residence for a stipulated ...
Deleveraging of the insurance company's balance sheet. ...
Wording in life insurance policies to determine the order of deaths when the insured and the beneficiary die in the same accident. For example, if the insured is deemed to have died first, ...
Policy whose premiums, cash value, and face amount are guaranteed (all values are fixed and do not fluctuate according to the loss experience, expenses, and investment returns of the ...
Measurement of how people feel about prevailing economic conditions, employment outlook, and personal finances. This index is based on statistics gathered from questionnaires mailed by the ...
Bond guaranteeing that a contractor will perform under the contract in accordance with all specifications of the bid submitted. ...
Demographic designation used in life insurance to calculate premium rates for life and health insurance and annuity contracts. Since females have a longer life expectancy than males of the ...
Reserve at the beginning of the policy year that is equal to the terminal reserve for the preceding year plus the net level premium for the current year. ...
Same as term Cancellation Provision Clause: provision permitting an insured or an insurance company to cancel a property and casualty or a health insurance policy (circumstances vary; see ...
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