Summaries of cancellations and non-renewals of product liability insurance.

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Waiver of inspection required by Regulation 79 for new automobile physical damage obtained from applicants previously insured with Safeco.


Guidelines for approval of retirement plans of domestic life insurance companies. (See also Addendum to CL 12 (1980) on this listing).


Chapter 250 of the Laws of 1979, in relation to failure to file annual statements or to reply to inquiries and relating to penalties in connection therewith.


Standard claim forms for accident & health insurance. (See also CL 4 (1978) on this listing).


Applicability of Section 4228(g)(7).


Credit for retrospective debits developed pursuant to the provisions of reinsurance agreements. (See also CL 8 (1982) on the Current listing).


Expenses of officers’ spouses on business trips.


National Flood Insurance Program-Homeowners Policies.


Liens against the proceeds of fire insurance policies. (Information Bulletin # 5) (See also CL 9 (1978) on this listing).


Reports of claims for product liability (See also CL 26 (1979) on this listing).


Amended reporting requirements product liability insurance (See also Addendum to CL 7 (1980) and CL 22 (1979) both on this listing).


Guarantee Issue Life Insurance Advertising (Substantive)

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No Automatic Policy Renewals (Substantive)


Payments by Secondary Plan Under Coordination of Benefits (Substantive)


Reimbursement of Nurse Mid-Wives (Substantive)


Group Administrative Expense Reimbursement (Substantive)


Section 3737.71 of the Ohio Revised Code --- State Fire Marshal's Tax (Substantive)


Rescission of Bulletin 93-7 (Major Modification Filing as to Dividends) (Rescission)


Rescinding Bulletin 90-3 (Insurance Fraud Warning Requirement) (Supersedes Bulletin 90-3; also appears on list of Rescission Bulletins) (Substantive)


Premium or Franchise Tax Offsets for Guaranty Fund Contributions Under ORC 3901.47 and 3956.20 (Substantive)


Prospective Loss Costs Filing Procedure (Substantive)


Rescission of Bulletin 88-2 (Medicare Supplement Advertising Requirements; superseded by Rule 3901-1-41, effective 10/19/1990) (Rescission)


Policy Cancellations (Substantive)


Additional Information

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(a) When reviewing each filing under this division, TDI may request additional information specific to the filing. This information may include:

(1) related forms or information needed for the review;

(2) a summary of all policy provisions, including a detailed description and explanation of the coverages, limitations, exclusions, and conditions;

(3) a coverage comparison to a similar policy form or endorsement that the Commissioner has approved or adopted containing a detailed explanation of all the differences including any restrictions in coverage, enhancements in coverage, or clarifications to the previously approved policy forms or endorsements.

(4) a coverage evaluation that contains a detailed explanation of the proposed changes including any restrictions in coverage, enhancements in coverage, or clarifications to approved or adopted policy forms or endorsements. The coverage evaluation may be provided in a side-by-side comparison showing any differences between the previously approved or adopted policy forms or endorsements and the proposed policy forms or endorsements.

(b) Filers must provide information requested by TDI under this section.

Source Note: The provisions of this §5.9322 adopted to be effective July 28, 2019, 44 TexReg 3640.


Filing Format Requirements

(a) Documents included in filings may not be encrypted or password protected. TDI staff must be able to fully process and review the documents without a password or other decryption process.

(b) The policy forms, endorsements, and form usage tables submitted in a filing under Division 5 of this subchapter (relating to Filings Made Easy - Requirements for Property and Casualty Policy Form and Endorsement Filings) must:

(1) not be scanned documents;

(2) not include any scanned text, or scanned images with text, that will be part of the insurance contract;

(3) be in a format that is selectable and searchable; and

(4) be in portrait, not landscape, orientation.

Source Note: The provisions of this §5.9313 adopted to be effective January 8, 2024, 49 TexReg 41.


General Filing Requirements

(a) Filings must be submitted for one line of insurance only, except for multi-peril and interline filings.

(b) Filings submitted under this division may not be combined with any other filing types submitted under this subchapter.

(c) Filings must contain the following:

(1) the transmittal information required in §5.9310 of this title (relating to Property and Casualty Transmittal Information and General Filing Requirements);

(2) a copy of the proposed policy forms or endorsements;

(3) a form number for each proposed form;

(4) an edition date for each proposed form, if applicable;

(5) the TDI file number or SERFF tracking number for the previously approved policy to which the proposed form will be attached, if applicable;

(6) a form usage table that includes:

(A) the form name and form number for each proposed form;

(B) information indicating whether each proposed form is optional, mandatory, or conditional mandatory; and

(C) for conditional mandatory forms, an addendum to the form usage table that describes the conditions that make each form mandatory. For filings other than personal automobile, residential property, or personal multi-peril, the filer may describe the conditions elsewhere in the filing;

(7) a memorandum that:

(A) explains in detail the reasons for the filing;

(B) describes each proposed policy form or endorsement; and

(C) details each policy form or endorsement's use, including the type of risk or risks for which the forms or endorsements will be used.

(d) Filings must also meet the following requirements.

(1) Filings must include all provisions required by statute, administrative rule, or Commissioner's order. Filers may add the required provisions to a policy form by including a Texas amendatory endorsement. The filing must include the amendatory endorsement, or the filing may reference an approved amendatory endorsement that applies to the policy forms in the filing.

(2) For amended policy forms or endorsements, copies of the previously approved or adopted policy forms or endorsements indicating the differences between the approved or adopted policy forms or endorsements and the filed policy forms or endorsements must be included. New text must be underlined, and deleted text must be in brackets with a strikethrough. Alternatively, the changes can be indicated by other clearly identified or highlighted editorial notations referencing new and replaced text. The marked changes must be in a separate single document for each filed form.

(e) Unless requested by TDI, filings made by advisory organizations do not need to include:

(1) the proposed effective date specified in §5.9310(c)(9) of this title; or

(2) the form usage table specified in subsection (c)(6) of this section.

Source Note: The provisions of this §5.9321 adopted to be effective July 28, 2019, 44 TexReg 3640; amended to be effective January 8, 2024, 49 TexReg 41.


Commercial Risks Shared by Two or More Insurers

(a) This section applies in the event that the total limit of liability for a single commercial risk or account must be shared by two or more insurers as a result of either a single insurer not having the capacity to provide the total limit of liability for the single risk or account to be shared or as a result of a single insurer being unwilling to accept the total limit of liability for the single risk or account to be shared because it produces a more hazardous exposure.

(b) For purposes of this section, "lead insurer" shall mean the insurer providing coverage for the largest percentage of liability for a single commercial risk or account or the insurer designated by the insured as the lead insurer.

(c) The policy forms and endorsements issued to provide coverage on a single commercial risk or account which is shared by two or more insurers must be filed and approved for the lead insurer. Other insurers sharing such coverage on a single commercial risk or account with the lead insurer must use the filed and approved policy forms and endorsements of the lead insurer. These approved policy forms and endorsements may be used by such other insurers sharing such coverage without making a separate filing to the Texas Department of Insurance for approval.

(d) A notice indicating the name of the lead insurer must be placed on each policy of insurance issued to provide coverage on a single commercial risk or account which is shared by two or more insurers. The notice must contain the following or similar language: "The insurance provided for this (risk or account) is shared by two or more companies. The lead insurer is ___________."

Source Note: The provisions of this §5.9301 adopted to be effective September 29, 1993, 18 TexReg 6323; amended to be effective April 26, 1998, 23 TexReg 3835.


Copyright, Public Inspection, and Confidential Filings

(a) Copyright. Information included in filings that is marked "copyright" may be made available for public disclosure in the same manner as information that is not marked "copyright." Public disclosure methods may include posting filings on TDI's website or making them available for viewing through SERFF.

(b) Public inspection. Each filing submitted under Insurance Code Chapter 2301 or 3502, including any supporting information filed, will be open for public inspection as of the date of the filing. This subsection does not apply to a commercial property insurance filing submitted by a Lloyd's plan or a reciprocal or interinsurance exchange under Chapter 2301. Each filing submitted under Insurance Code Chapter 2053 and 2251, including any supporting information filed, is public information subject to Government Code Chapter 552, including any applicable exception from required disclosure under that chapter.

(c) Confidential filings. If a filer marks its entire filing as confidential, TDI will reject the filing.

Source Note: The provisions of this §5.9311 adopted to be effective July 28, 2019, 44 TexReg 3640.


Personally Identifiable Information

Filings must not include any policyholders' personally identifiable information. Filings that include this type of information may be rejected. As used in this subchapter, personally identifiable information means information that can be used either alone or in combination to distinguish an individual's identity. Examples of personally identifiable information include:

(1) any individual policyholder identification, including name, address, phone number, or email address;

(2) social security numbers;

(3) insurance policy numbers;

(4) drivers' license, identification card, vehicle identification, and license plate numbers;

(5) debit card, credit card, bank account, and routing numbers; and

(6) health information about a specific individual.

Source Note: The provisions of this §5.9312 adopted to be effective July 28, 2019, 44 TexReg 3640; amended to be effective January 8, 2024, 49 TexReg 41.


Definition of Catastrophe

(a) An individual insurer or a group of insurers may petition the Texas Department of Insurance for a determination that a weather-related event is a catastrophe or major natural disaster in accordance with Insurance Code §542.059. The Texas Department of Insurance will make a determination within three business days of receipt of a petition, and if the event is determined to be a catastrophe, it will notify all companies, by bulletin issued by the Texas Department of Insurance of the designated catastrophe.

(b) An insurer's petition as specified in subsection (a) of this section must include, but is not limited to, the following information:

(1) type of losses: wind, hail, tornado, hurricane, freeze, or other weather-related losses;

(2) specific lines of insurance affected: property, automobile, inland marine (any lines which may involve a first party claim);

(3) location of the loss: towns, cities, or other specified areas;

(4) specific time period of the event which produced the catastrophe;

(5) the insurer's total estimated dollar losses for insured property, by line of business;

(6) the insurer's total estimated number of claims, by line of insurance;

(7) a statement of the reason claims cannot be processed within the time periods specified under the conditions of the property and casualty policies and Insurance Code §§542.055 - 542.057.

(c) For a weather-related event to be considered a catastrophe or major natural disaster by the Texas Department of Insurance:

(1) The area in which the losses occur must be defined by reasonable boundaries.

(2) For the designated area where the losses occur, either the:

(A) estimated total dollar losses must be $50 million or more in the aggregate for all insurers, and the estimated total number of claims must be 5,000 or more in the aggregate for all insurers; or

(B) estimated total number of claims must be 10,000 or more in the aggregate for all insurers.

(3) The estimated dollar losses and number of claims in paragraph (2) of this subsection may include all lines of insurance listed in subsection (b)(2) of this section.

(d) If the Texas Department of Insurance determines a catastrophe exists, the provisions of Insurance Code §542.059 apply for all affected insurers.

(e) Claims processed in accordance with Insurance Code §542.059 must include all losses arising from the event or events identified in subsection (b)(4) of this section.

(f) In addition to subsections (a) - (c) of this section, the Texas Department of Insurance may use any other criteria it deems appropriate for determining if a catastrophe exists in connection with a weather-related event or natural disaster.

Source Note: The provisions of this §5.9303 adopted to be effective June 29, 1992, 17 TexReg 4255; amended to be effective September 20, 2017, 42 TexReg 4817.


Purpose and Definitions

(a) Purpose. The purpose of this division is to specify the filing requirements for property and casualty policy form and endorsement filings submitted under Insurance Code Chapters 2052, 2301, or 3502. All insurer and advisory organization filings must comply with the filing requirements of this division and any other applicable rules.

(b) Definitions. The definitions in §5.9310 of this title (relating to Property and Casualty Transmittal Information and General Filing Requirements) apply to this division.

Source Note: The provisions of this §5.9320 adopted to be effective July 28, 2019, 44 TexReg 3640.


Rescindment of Cancellation or Non-Renewal

(a) An insurer or other entity that rescinds a cancellation or non-renewal noticed to the TCEQ pursuant to the Water Code §26.352(e-1) and §5.9104 of this subchapter (relating to Content of Notice) must send written notice to the TCEQ of such rescindment in accordance with §5.9105(b) of this subchapter (relating to Submission of Notice) not later than the 10th day after the cancellation or non-renewal is rescinded.

(b) The notice of rescindment required in subsection (a) of this section must include:

(1) a copy of the notice under §5.9104 of this subchapter that is being rescinded; or

(2) both of the following:

(A) the policy number or other financial assurance identification number, and

(B) the facility identification number(s) assigned by the TCEQ for the underground storage tank(s) insured or otherwise financially assured.

(c) The notice required by subsection (a) of this section must be accurate and contain all the information required under subsection (b) of this section. It is the sole responsibility of the insurer or other entity providing, holding, or maintaining financial assurance to obtain and maintain the information necessary to complete the required notice.

Source Note: The provisions of this §5.9106 adopted to be effective April 9, 2008, 33 TexReg 2820.


Disciplinary Actions by the Commissioner of Insurance

The Commissioner of Insurance may, after notice and an opportunity for a hearing, discipline an insurer under the Insurance Code Chapters 82, 83, 84, and 2201 for violations of the requirements of this subchapter and any other applicable law the Commissioner determines the insurer to be in violation of, or with which the insurer has failed to comply.

Source Note: The provisions of this §5.9107 adopted to be effective April 9, 2008, 33 TexReg 2820.


Property and Casualty Transmittal Information and General Filing Requirements

(a) Purpose. The purpose of this division is to specify the transmittal information and general filing requirements for property and casualty form, rate, rule, underwriting guideline, and credit scoring model filings.

(b) Definitions. Terms not defined in this division may be defined in Insurance Code Chapters 2053, concerning Rates for Workers' Compensation Insurance; 2251, concerning Rates; and 2301, concerning Policy Forms and have the same meaning when used in this division. The following terms when used in this division have the following meanings unless the context indicates otherwise:

(1) Interline filing--A filing that may be used for more than one line of insurance submitted for:

(A) a policy jacket, declarations page, signature page, notice of cancellation, disclosure, schedule, general change form, company name change, or policyholder notice filed under Division 5 of this subchapter, relating to Filings Made Easy - Requirements for Property and Casualty Policy Form and Endorsement Filings; or

(B) policy fees, service fees, and other fees that are charged or collected by the insurer under Insurance Code §550.001, concerning Solicitation or Collection of Certain Payments, or §4005.003, concerning Fees, filed under Division 6 of this subchapter (relating to Filings Made Easy - Requirements for Rate and Rule Filings).

(2) Multi-peril insurance--Policies and rates for two or more lines of insurance that are subject to regulation under Insurance Code Chapters 2251 and 2301. This definition does not include a combination of coverages described in:

(A) Insurance Code §2251.002, concerning Definitions, and §2301.002, concerning Definitions, and filed as commercial property insurance; or

(B) Insurance Code §2251.0031, concerning Exceptions for Certain Lines, and §2301.0031, concerning Exceptions for Certain Lines.

(3) NAIC--The National Association of Insurance Commissioners.

(4) Reference filing--A filing that references the use of policy forms, endorsements, rules, loss costs, rating manuals, other supplementary rating information, or credit scoring models that TDI has adopted, approved, or accepted.

(5) SERFF--The NAIC System for Electronic Rate and Form Filing.

(6) TDI--Texas Department of Insurance.

(7) TDI file number--The number TDI assigns to a filing.

(c) Transmittal information. Each filing must contain the following transmittal information:

(1) company name as used for financial reporting to the NAIC and company number assigned by the NAIC;

(2) company group name and group NAIC number;

(3) whether the filing is new, or revises or replaces an existing filing;

(4) TDI file number or SERFF tracking number of the revised or replaced filing;

(5) TDI file number or SERFF tracking number for the previously approved policy that the proposed form will be attached to;

(6) TDI file number or SERFF tracking number of associated or companion filings of other filing types;

(7) line of insurance:

(A) all filings must specify the line of insurance; and

(B) interline filings must specify all lines of insurance to which the filing applies.

(8) type of filing;

(9) proposed effective date; and

(10) contact person, including name, telephone number, and mailing address.

(d) Multi-peril use. A filing submitted for a line of insurance that is subject to regulation under Insurance Code Chapters 2251 and 2301 may also be used in multi-peril insurance.

(e) Filings Made Easy Guide. TDI maintains the Filings Made Easy Guide to help insurers submit filings and comply with statutory requirements. Insurers may obtain this guide from TDI's website at www.tdi.texas.gov.

(f) Letter of authorization. A third party representing an insurer on a filing must provide a letter of authorization signed by the insurer on the insurer's letterhead. A letter of authorization applies only to the filing with which it is submitted.

(g) Submission of filing. Filings under Divisions 5, 6, 7, 8, and 9 of this subchapter (relating to Filings Made Easy - Requirements for Property and Casualty Policy Form and Endorsement Filings; Filings Made Easy - Requirements for Rate and Rule Filings; Filings Made Easy - Requirements for Underwriting Guideline Filings; Filings Made Easy - Requirements for Credit Scoring Model Filings for Personal Insurance; and Filings Made Easy - Reduced Filing Requirements for Certain Insurers) must be submitted through SERFF.

(h) Public disclosure of contact information. To the extent that a filing includes company contact information, by submitting a filing the company affirmatively consents to the release and disclosure of its company contact information, including any email addresses. The filer also certifies that each person associated with an email address that appears in the filing has affirmatively consented to the release and disclosure of that email address.

Source Note: The provisions of this §5.9310 adopted to be effective February 10, 2005, 30 TexReg 548; amended to be effective August 13, 2006, 31 TexReg 6221; amended to be effective November 16, 2014, 39 TexReg 8694; amended to be effective July 28, 2019, 44 TexReg 3640; amended to be effective January 8, 2024, 49 TexReg 41.


Requirements for Reference Filings

(a) Reference filings for policy forms and endorsements should not include a copy of the referenced material.

(b) In addition to the transmittal information, a reference filing must include:

(1) the name of the insurance company or advisory organization whose filing is being referenced; and

(2) the TDI file number or SERFF tracking number of the filing being referenced.

(c) For personal automobile, residential property, and personal multi-peril insurance, the filing must also include:

(1) a list of each form and endorsement that the insurer will use from each referenced filing; and

(2) a form usage table, as described in §5.9321(c)(6) of this title (relating to General Filing Requirements), that includes each form and endorsement that the insurer will use from each referenced filing.

(d) If a filer wants to change a form or endorsement approved for another insurer or an advisory organization, the filer may not submit the form as a reference filing. The filer must submit the amended form for approval with the information required by §5.9321 and §5.9322 of this title (relating to Additional Information).

Source Note: The provisions of this §5.9323 adopted to be effective July 28, 2019, 44 TexReg 3640; amended to be effective January 8, 2024, 49 TexReg 41.


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                   Table of Contents   »  Title 14. Insurance  »  Agency 5. State Corporation Commission, Bureau of Insurance  »  Chapter 322. Use of the 2001 CSO Preferred Class Structure Mortality Table in Determining Reserve Liabilities

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                      Virginia Administrative Code

                      Chapter 322. Use of the 2001 CSO Preferred Class Structure Mortality Table in Determining Reserve Liabilities  14VAC5-322-10. Authority.  This chapter is promulgated by the commission, pursuant to §  38.2-223  of the Code of Virginia and in accordance with §   38.2-1369  of the Code of Virginia and  14VAC5-319-40 , to approve, recognize, permit, and prescribe the use of the 2001 Commissioners Standard Ordinary (CSO) Preferred Class Structure Mortality Table by and for insurers transacting the business of insurance in this Commonwealth.   Statutory Authority  §§  12.1-13  and  38.2-223  of the Code of Virginia.  Historical Notes  Derived from Virginia Register  Volume 23, Issue 10 , eff. January 1, 2007; amended, Virginia Register  Volume 31, Issue 9 , eff. January 1, 2015.    14VAC5-322-20. Definitions.  The following words and terms when used in this chapter shall have the following meanings unless the context clearly indicates otherwise:
 "2001 CSO Mortality Table" means that mortality table, consisting of separate rates of mortality for male and female lives, developed by the American Academy of Actuaries CSO Task Force from the Valuation Basic Mortality Table developed by the Society of Actuaries Individual Life Insurance Valuation Mortality Task Force, and adopted by the NAIC in December 2002. The 2001 CSO Mortality Table is included in the Proceedings of the NAIC (2nd Quarter 2002) and supplemented by the 2001 CSO Preferred Class Structure Mortality Table. Unless the context indicates otherwise, the "2001 CSO Mortality Table" includes both the ultimate form of that table and the select and ultimate form of that table and includes both the smoker and nonsmoker mortality tables and the composite mortality tables. It also includes both the age-nearest-birthday and age-last-birthday bases of the mortality tables. The 2001 CSO Mortality Table may be accessed via the  Society of Actuaries' website,   https://mort.soa.org/ . Mortality tables in the 2001 CSO Mortality Table include the following:
 1. "2001 CSO Mortality Table (F)" means that mortality table consisting of the rates of mortality for female lives from the 2001 CSO Mortality Table.
 2. "2001 CSO Mortality Table (M)" means that mortality table consisting of the rates of mortality for male lives from the 2001 CSO Mortality Table.
 3. "Composite mortality tables" means mortality tables with rates of mortality that do not distinguish between smokers and nonsmokers.
 4. "Smoker and nonsmoker mortality tables" means mortality tables with separate rates of mortality for smokers and nonsmokers.
 "2001 CSO Preferred Class Structure Mortality Table" means mortality tables with separate rates of mortality for Super Preferred Nonsmokers, Preferred Nonsmokers, Residual Standard Nonsmokers, Preferred Smokers, and Residual Standard Smoker splits of the 2001 CSO Nonsmoker and Smoker tables adopted by the NAIC in September 2006. The 2001 CSO Preferred Class Structure Mortality Table is included in the Proceedings of the NAIC (3rd Quarter 2006). Unless the context indicates otherwise, the "2001 CSO Preferred Class Structure Mortality Table" includes both the ultimate form of that table and the select and ultimate form of that table. It includes both the smoker and nonsmoker mortality tables. It includes both the male and female mortality tables and the gender composite mortality tables. It also includes both the age-nearest-birthday and age-last-birthday bases of the mortality table. The 2001 CSO Preferred Class Structure Mortality Table may be accessed via the Society of Actuaries website,   https://www.soa.org/globalassets/assets/files/xls/2001-cso-preferred-class-structure-mortality-tables.xls .
 "Commission" means the State Corporation Commission.
 "Commissioner" means the Commissioner of Insurance in Virginia unless specific reference is made to another state, in which case "commissioner" means the insurance commissioner, director, superintendent or other supervising regulatory official of a given state who is responsible for administering the insurance laws of that state.
 "NAIC" means the National Association of Insurance Commissioners.
 "Statistical agent" means an entity with proven systems for protecting the confidentiality of individual insured and insurer information; demonstrated resources for and history of ongoing electronic communications and data transfer ensuring data integrity with insurers, which are its members or subscribers; and a history of and means for aggregation of data and accurate promulgation of the experience modifications in a timely manner.  Statutory Authority  §§  12.1-13  and  38.2-223  of the Code of Virginia.  Historical Notes  Derived from Virginia Register  Volume 23, Issue 10 , eff. January 1, 2007; amended, Virginia Register  Volume 26, Issue 4 , eff. September 30, 2009;  Volume 37, Issue 4 , eff. October 12, 2020.    14VAC5-322-30. 2001 CSO Preferred Class Structure Mortality Table.  At the election of the insurer, for each calendar year of issue, for any one or more specified plans of insurance and subject to satisfying the conditions stated in this chapter, the 2001 CSO Preferred Class Structure Mortality Table may be substituted in place of the 2001 CSO Smoker or Nonsmoker Mortality Table as the minimum valuation standard for policies issued on or after January 1, 2007, or, with the consent of the commissioner and subject to the conditions set forth in  14VAC5-322-40  D,  January 1, 2004. In determining such consent, the commissioner may rely on the consent of the commissioner of the company's state of domicile. No such election shall be made until the insurer demonstrates at least 20% of the business to be valued on this table is in one or more of the preferred classes. A table from the 2001 CSO Preferred Class Structure Mortality Table used in place of a 2001 CSO Mortality Table, pursuant to the requirements of this chapter, will be treated as part of the 2001 CSO Mortality Table only for purposes of reserve valuation pursuant to the requirements of the rules entitled "Use of the 2001 CSO Mortality Table In Determining Minimum Reserve Liabilities And Nonforfeiture Benefits" ( 14VAC5-321 ).   Statutory Authority  §§  12.1-13  and  38.2-223  of the Code of Virginia.  Historical Notes  Derived from Virginia Register  Volume 23, Issue 10 , eff. January 1, 2007; amended, Virginia Register  Volume 26, Issue 4 , eff. September 30, 2009.    14VAC5-322-40. 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 10 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 10 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 exempted by the commission, every authorized insurer having elected to substitute the 2001 CSO Preferred Class Structure Mortality Table pursuant to this chapter shall file annually with a statistical agent designated by the NAIC and acceptable to the commission, statistical reports showing mortality and such other information as the commission may deem necessary or expedient for the administration of the provisions of this chapter. The commission shall require the use of a statistical report form established by the NAIC or by a statistical agent designated by the NAIC and acceptable to the commission.

 D. The use of the 2001 CSO Preferred Class Structure Mortality Table for the valuation of policies issued prior to January 1, 2007, shall not be permitted in any statutory financial statement in which a company reports, with respect to any policy or portion of a policy coinsured, either of the following:
 1. In cases where the mode of payment of the reinsurance premium is less frequent than the mode of payment of the policy premium, a reserve credit that exceeds, by more than the amount specified in this subdivision as Y, the gross reserve calculated before reinsurance. Y is the amount of the gross reinsurance premium that (i) provides coverage for the period from the next policy premium due date to the earlier of the end of the policy year and the next reinsurance premium due date, and (ii) would be refunded to the ceding entity upon the termination of the policy.
 2. In cases where the mode of payment of the reinsurance premium is more frequent than the mode of payment of the policy premium, a reserve credit that is less than the gross reserve, calculated before reinsurance, by an amount that is less than the amount specified in this subdivision as Z. Z is the amount of the gross reinsurance premium that the ceding entity would need to pay the assuming company to provide reinsurance coverage from the period of the next reinsurance premium due date to the next policy premium due date minus any liability established for the proportionate amount not remitted to the reinsurer.
 For purposes of this condition, both the reserve credit and the gross reserve before reinsurance (i) for the mean reserve method shall be defined as the mean reserve minus the deferred premium asset, and (ii) for the mid-terminal reserve method shall include the unearned premium reserve. A company may estimate and adjust its accounting on an aggregate basis in order to meet the conditions to use the 2001 CSO Preferred Class Structure Mortality Table.
 E. This section is effective for valuations on and after December 31, 2008.   Statutory Authority  §§  12.1-13  and  38.2-223  of the Code of Virginia.  Historical Notes  Derived from Virginia Register  Volume 23, Issue 10 , eff. January 1, 2007; amended, Virginia Register  Volume 26, Issue 4 , eff. September 30, 2009.    14VAC5-322-50. Severability clause.    If any provision of this chapter or the application thereof to any person or circumstance is for any reason held to be invalid, the remainder of the chapter and the application of the provision to other persons or circumstances shall not be affected thereby.   Statutory Authority  §§  12.1-13  and  38.2-223  of the Code of Virginia.  Historical Notes  Derived from Virginia Register  Volume 23, Issue 10 , eff. January 1, 2007.    Documents Incorporated by Reference (14VAC5-322)  2001 CSO Mortality Table, American Academy of Actuaries, June 2002.
 Preferred Class Structure Mortality Table, Society of Actuaries, January 30, 2006 report, as adopted by NAIC September 2006.
                     Website addresses provided in the Virginia Administrative Code to documents incorporated by reference are for the reader's convenience only, may not necessarily be active or current, and should not be relied upon. To ensure the information incorporated by reference is accurate, the reader is encouraged to use the source document described in the regulation.
                     As a service to the public, the Virginia Administrative Code is provided online by the Virginia General Assembly. We are unable to answer legal questions or respond to requests for legal advice, including application of law to specific fact. To understand and protect your legal rights, you should consult an attorney.

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14VAC5-340-150:9. (Repealed.)

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                   Table of Contents   »  Title 14. Insurance  »  Agency 5. State Corporation Commission, Bureau of Insurance  »  Chapter 340. Rules Governing Standards for the Content of Fire Insurance or Fire Insurance in Combination with Other Coverages

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                      Chapter 340. Rules Governing Standards for the Content of Fire Insurance or Fire Insurance in Combination with Other Coverages  14VAC5-340-10. (Repealed.)  Historical Notes  Derived from Regulation 17, Case No. INS800067, § 2, eff. February 1, 1982; repealed, Virginia Register  Volume 38, Issue 11 , eff. January 1, 2022.    14VAC5-340-20. (Repealed.)  Historical Notes  Derived from Regulation 17, Case No. INS800067, § 3, eff. February 1, 1982.    14VAC5-340-30. (Repealed.)  Historical Notes  Derived from Regulation 17, Case No. INS800067, § 4, eff. February 1, 1982.    14VAC5-340-40. (Repealed.)  Historical Notes  Derived from Regulation 17, Case No. INS800067, § 5, eff. February 1, 1982.    14VAC5-340-50. (Repealed.)  Historical Notes  Derived from Regulation 17, Case No. INS800067, § 6, eff. February 1, 1982.    14VAC5-340-60. (Repealed.)  Historical Notes  Derived from Regulation 17, Case No. INS800067, § 7, eff. February 1, 1982.    14VAC5-340-70. (Repealed.)  Historical Notes  Derived from Regulation 17, Case No. INS800067, § 8, eff. February 1, 1982.    14VAC5-340-80. (Repealed.)  Historical Notes  Derived from Regulation 17, Case No. INS800067, § 9, eff. February 1, 1982.    14VAC5-340-90. (Repealed.)  Historical Notes  Derived from Regulation 17, Case No. INS800067, § 10, eff. February 1, 1982.    14VAC5-340-100. (Repealed.)  Historical Notes  Derived from Regulation 17, Case No. INS800067, § 11, eff. February 1, 1982. 1982; repealed, Virginia Register  Volume 38, Issue 11 , eff. January 1, 2022.    14VAC5-340-110. (Repealed.)  Historical Notes  Derived from Regulation 17, Case No. INS800067, § 12, eff. February 1, 1982; repealed, Virginia Register  Volume 38, Issue 11 , eff. January 1, 2022.    14VAC5-340-120. (Repealed.)  Historical Notes  Derived from Regulation 17, Case No. INS800067, § 13, eff. February 1, 1982; repealed, Virginia Register  Volume 38, Issue 11 , eff. January 1, 2022.    14VAC5-340-130. (Repealed.)  Historical Notes  Derived from Regulation 17, Case No. INS800067, § 14, eff. February 1, 1982; repealed, Virginia Register  Volume 38, Issue 11 , eff. January 1, 2022.    14VAC5-340-140. (Repealed.)  Historical Notes  Derived from Regulation 17, Case No. INS800067, § 15, eff. February 1, 1982.    14VAC5-340-150. (Repealed.)  Historical Notes  Derived from Regulation 17, Case No. INS800067, § 16, eff. February 1, 1982.    14VAC5-340-150:1. (Repealed.)    14VAC5-340-150:2. (Repealed.)    14VAC5-340-150:3. (Repealed.)    14VAC5-340-150:4. (Repealed.)    14VAC5-340-150:5. (Repealed.)    14VAC5-340-150:6. (Repealed.)    14VAC5-340-150:7. (Repealed.)    14VAC5-340-150:8. (Repealed.)    14VAC5-340-150:9. (Repealed.)
                     Website addresses provided in the Virginia Administrative Code to documents incorporated by reference are for the reader's convenience only, may not necessarily be active or current, and should not be relied upon. To ensure the information incorporated by reference is accurate, the reader is encouraged to use the source document described in the regulation.
                     As a service to the public, the Virginia Administrative Code is provided online by the Virginia General Assembly. We are unable to answer legal questions or respond to requests for legal advice, including application of law to specific fact. To understand and protect your legal rights, you should consult an attorney.

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14VAC5-318-80. Severability.

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                   Table of Contents   »  Title 14. Insurance  »  Agency 5. State Corporation Commission, Bureau of Insurance  »  Chapter 318. Rules Governing Term and Universal Life Insurance Reserve Financing

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                      Chapter 318. Rules Governing Term and Universal Life Insurance Reserve Financing  14VAC5-318-10. Purpose and scope.  The purpose of this chapter is to set forth rules and procedural requirements to establish uniform, national standards governing reserve financing arrangements pertaining to life insurance policies containing guaranteed nonlevel gross premiums or guaranteed nonlevel benefits and universal life insurance policies with secondary guarantees and to ensure that, with respect to each such financing arrangement, funds consisting of primary security and other security, as defined in  14VAC5-318-30 , are held by or on behalf of ceding insurers in the forms and amounts required in this chapter. In general, reinsurance ceded for reserve financing purposes has one or more of the following characteristics: some or all of the assets used to secure the reinsurance treaty or to capitalize the reinsurer (i) are issued by the ceding insurer or its affiliates; (ii) are not unconditionally available to satisfy the general account obligations of the ceding insurer; or (iii) create a reimbursement, indemnification, or other similar obligation on the part of the ceding insurer or any if its affiliates (other than a payment obligation under a derivative contract acquired in the normal course and used to support and hedge liabilities pertaining to the actual risks in the policies ceded pursuant to the reinsurance treaty).   Statutory Authority  §§  12.1-13 ,  38.2-223 , and  38.2-1316.7  of the Code of Virginia.  Historical Notes  Derived from Virginia Register  Volume 34, Issue 9 , eff. January 1, 2018.    14VAC5-318-20. Applicability.  This chapter shall apply to reinsurance treaties that cede liabilities pertaining to covered policies, as that term is defined in  14VAC5-318-30 , issued by any life insurance company domiciled in this Commonwealth. The requirements of this chapter shall pertain to all covered policies in force as of and after January 1, 2018. This chapter and  14VAC5-300  shall both apply to such reinsurance treaties, provided that in the event of a direct conflict between the provisions of this chapter and  14VAC5-300 , the provisions of this chapter shall apply, but only to the extent of the conflict.   Statutory Authority  §§  12.1-13 ,  38.2-223 , and  38.2-1316.7  of the Code of Virginia.  Historical Notes  Derived from Virginia Register  Volume 34, Issue 9 , eff. January 1, 2018.    14VAC5-318-30. Definitions.  The following words and terms when used in this chapter shall have the following meanings, unless the context clearly indicates otherwise:
 "Actuarial method" means the methodology used to determine the required level of primary security, as described in  14VAC5-318-50 .
 "Commission" means the State Corporation Commission when acting pursuant to or in accordance with Title 38.2 of the Code of Virginia.
 "Covered policy" means, subject to the exemptions described in  14VAC5-318-40 , those policies, other than grandfathered policies, of the following policy types:
 1. Life insurance policies with guaranteed nonlevel gross premiums or guaranteed nonlevel benefits, except for flexible premium universal life insurance policies; or
 2. Flexible premium universal life insurance policies with provisions resulting in the ability of a policyholder to keep a policy in force over a secondary guarantee period.
 "Grandfathered policies" means policies of the types described in the "covered policy" definition that were:
 1. Issued prior to January 1, 2015; and
 2. Ceded, as of December 31, 2014, as part of a reinsurance treaty that would not have met one of the exemptions set forth in  14VAC5-318-40  had that section then been in effect.
 "NAIC" means the National Association of Insurance Commissioners.
 "Noncovered policy" means any policy that does not meet the definition of covered policy, including grandfathered policies.
 "Required level of primary security" means the dollar amount determined by applying the actuarial method to the risks ceded with respect to covered policies, but not more than the total reserve ceded.
 "Primary security" means the following forms of security:
 1. Cash meeting the requirements of subdivision 2 a of §  38.2-1316.4  of the Code of Virginia;
 2. Securities listed by the Securities Valuation Office meeting the requirements of subdivision 2 b of §  38.2-1316.4  of the Code of Virginia, but excluding any synthetic letter of credit, contingent note, credit-linked note, or other similar security that operates in a manner similar to a letter of credit, and excluding any securities issued by the ceding insurer or any of its affiliates; and
 3. For security held in connection with funds-withheld and modified coinsurance reinsurance treaties:
 a. Commercial loans in good standing of CM3 quality and higher as calculated for the life risk-based capital report;
 b. Policy loans; and
 c. Derivatives acquired in the normal course and used to support and hedge liabilities pertaining to the actual risks in the policies ceded pursuant to the reinsurance treaty.
 "Other security" means any security acceptable to the commission other than security meeting the definition of primary security.
 "Valuation manual" means the valuation manual adopted by the NAIC as described in subdivision B 1 of §  38.2-1379  of the Code of Virginia, with all amendments adopted by the NAIC that are effective for the financial statement date on which credit for reinsurance is claimed.
 "VM-20" means "requirements for principle-based reserves for life products," including all relevant definitions, from the valuation manual.  Statutory Authority  §§  12.1-13 ,  38.2-223 , and  38.2-1316.7  of the Code of Virginia.  Historical Notes  Derived from Virginia Register  Volume 34, Issue 9 , eff. January 1, 2018.    14VAC5-318-40. Exemptions from this chapter.  This chapter does not apply to the situations described in subdivisions 1 through 6 of this section.
 1. Reinsurance of:
 a. Policies that satisfy the criteria for exemption set forth in  14VAC5-319-50  F or G and that are issued before the later of:
 (1) January 1, 2018; and
 (2) The date on which the ceding insurer begins to apply the provisions of VM-20 to establish the ceded policies' statutory reserves, but in no event later than January 1, 2020;
 b. Portions of policies that satisfy the criteria for exemption set forth in  14VAC5-319-50  E and that are issued before the later of:
 (1) January 1, 2018; and
 (2) The date on which the ceding insurer begins to apply the provisions of VM-20 to establish the ceded policies' statutory reserves, but in no event later than January 1, 2020;
 c. Any universal life policy that meets all of the following requirements:
 (1) Secondary guarantee period, if any, is five years or less;
 (2) Specified premium for the secondary guarantee period is equal to or greater than the net level reserve premium for the secondary guarantee period based on the Commissioners Standard Ordinary (CSO) valuation tables and valuation interest rate applicable to the issue year of the policy; and
 (3) The initial surrender charge is equal to or greater than 100% of the first year annualized specified premium for the secondary guarantee period;
 d. Credit life insurance;
 e. Any variable life insurance policy that provides for life insurance, the amount or duration of which varies according to the investment experience of any separate account or accounts; or
 f. Any group life insurance certificate unless the certificate provides for a stated or implied schedule of maximum gross premiums required in order to continue coverage in force for a period in excess of one year;
 2. Reinsurance ceded to an assuming insurer that meets the applicable requirements of subdivision C 4 of §  38.2-1316.2  of the Code of Virginia and  14VAC5-300-90  C 1;
 3. Reinsurance ceded to an assuming insurer that meets the applicable requirements of subdivision C 1, C 2, or C 3 of §  38.2-1316.2  of the Code of Virginia and that in addition:
 a. Prepares statutory financial statements in compliance with §  38.2-1300  of the Code of Virginia, without any departures from NAIC statutory accounting practices and procedures pertaining to the admissibility or valuation of assets or liabilities that increase the assuming insurer's reported surplus and are material enough that they need to be disclosed in the financial statement of the assuming insurer pursuant to Statement of Statutory Accounting Principles No. 1 ("SSAP 1"); and
 b. Is not in a Company Action Level Event, Regulatory Action Level Event, Authorized Control Level Event, or Mandatory Control Level Event as those terms are defined in Chapter 55 (§  38.2-5500  et seq.) of Title 38.2 of the Code of Virginia when its risk-based capital (RBC) is calculated in accordance with §  38.2-5502  of the Code of Virginia;
 4. Reinsurance ceded to an assuming insurer that meets the applicable requirements of subdivision C 1, C 2, or C 3 of §  38.2-1316.2  of the Code of Virginia and that in addition:
 a. Is not an affiliate, as that term is defined in §  38.2-1322  of the Code of Virginia, of:
 (1) The insurer ceding the business to the assuming insurer; or
 (2) Any insurer that directly or indirectly ceded the business to that ceding insurer;
 b. Prepares statutory financial statements in compliance with the NAIC Accounting Practices and Procedures Manual;
 c. Is both:
 (1) Licensed or accredited in at least 10 states (including its state of domicile); and
 (2) Not licensed in any state as a captive, special purpose vehicle, special purpose financial captive, special purpose life reinsurance company, limited purpose subsidiary, or any other similar licensing regime; and
 d. Is not, or would not be, below 500% of the Authorized Control Level RBC as that term is defined in §  38.2-5501  of the Code of Virginia when its RBC is calculated in accordance with §  38.2-5502  of the Code of Virginia and without recognition of any departures from NAIC statutory accounting practices and procedures pertaining to the admission or valuation of assets or liabilities that increase the assuming insurer's reported surplus;
 5. Reinsurance ceded to an assuming insurer that meets the requirements of either subdivision B 4 a or B 4 b of §  38.2-1316.7  of the Code of Virginia; or
 6. Reinsurance not otherwise exempt under subdivisions 1 through 5 of this section if the commission, after consulting with the NAIC Financial Analysis Working Group or other group of regulators designated by the NAIC, as applicable, determines under all the facts and circumstances that all of the following apply:
 a. The risks are clearly outside of the intent and purpose of this chapter, as described in  14VAC5-318-10 ;
 b. The risks are included within the scope of this chapter only as a technicality; and
 c. The application of this chapter to those risks is not necessary to provide appropriate protection to policyholders. The commission shall publicly disclose any decision made pursuant to this subdivision to exempt a reinsurance treaty from this chapter, as well as the general basis therefor (including a summary description of the treaty).   Statutory Authority  §§  12.1-13 ,  38.2-223 , and  38.2-1316.7  of the Code of Virginia.  Historical Notes  Derived from Virginia Register  Volume 34, Issue 9 , eff. January 1, 2018.    14VAC5-318-50. The actuarial method.  A. The actuarial method to establish the required level of primary security for each reinsurance treaty subject to this chapter shall be VM-20, applied on a treaty-by-treaty basis, including all relevant definitions, from the Valuation Manual as then in effect, applied as follows:
 1. For covered policies as provided in subdivision 1 of the definition of "covered policy" in  14VAC5-318-30 , the actuarial method is the greater of the deterministic reserve or the net premium reserve (NPR) regardless of whether the criteria for exemption testing can be met. However, if the covered policies do not meet the requirements of the stochastic reserve exclusion test in the valuation manual, then the actuarial method is the greatest of the deterministic reserve, the stochastic reserve, or the NPR. In addition, if such covered policies are reinsured in a reinsurance treaty that also contains covered policies as provided in subdivision 2 of the definition of "covered policy" in  14VAC5-318-30 , the ceding insurer may elect to instead use subdivision 2 of this subsection as the actuarial method for the entire reinsurance agreement. Whether subdivision 1 or 2 of this subsection is used, the actuarial method must comply with any requirements or restrictions that the valuation manual imposes when aggregating these policy types for purposes of principle-based reserve calculations.
 2. For covered policies, as that term is defined in subdivision 2 of the definition of "covered policy" of  14VAC5-318-30 , the actuarial method is the greatest of the deterministic reserve, the stochastic reserve, or the NPR regardless of whether the criteria for exemption testing can be met.
 3. Except as provided in subdivision 4 of this subsection, the actuarial method is to be applied on a gross basis to all risks with respect to the covered policies as originally issued or assumed by the ceding insurer.
 4. If the reinsurance treaty cedes less than 100% of the risk with respect to the covered policies then the required level of primary security may be reduced as follows:
 a. If a reinsurance treaty cedes only a quota share of some or all of the risks pertaining to the covered policies, the required level of primary security, as well as any adjustment under subdivision A 4 c of this section, may be reduced to a pro rata portion in accordance with the percentage of the risk ceded;
 b. If the reinsurance treaty in a nonexempt arrangement cedes only the risks pertaining to a secondary guarantee, the required level of primary security may be reduced by an amount determined by applying the actuarial method on a gross basis to all risks, other than risks related to the secondary guarantee, pertaining to the covered policies, except that for covered policies for which the ceding insurer did not elect to apply the provisions of VM-20 to establish statutory reserves, the required level of primary security may be reduced by the statutory reserve retained by the ceding insurer on those covered policies, where the retained reserve of those covered policies should be reflective of any reduction pursuant to the cession of mortality risk on a yearly renewable term basis in an exempt arrangement;
 c. If a portion of the covered policy risk is ceded to another reinsurer on a yearly renewable term basis in an exempt arrangement, the required level of primary security may be reduced by the amount resulting by applying the actuarial method including the reinsurance section of VM-20 to the portion of the covered policy risks ceded in the exempt arrangement, except that for covered policies issued prior to January 1, 2017, this adjustment is not to exceed:                        c x                            2(number of reinsurance premiums per year)            where c x  is calculated using the same assumptions used in calculating the NPR; and
 d. For any other treaty ceding a portion of risk to a different reinsurer, including stop loss, excess of loss, and other nonproportional reinsurance treaties, there will be no reduction in the required level of primary security.
 It is possible for any combination of subdivisions A 4 a, b, c, and d of this section to apply. Such adjustments to the required level of primary security will be done in the sequence that accurately reflects the portion of the risk ceded via the treaty. The ceding insurer should document the rationale and steps taken to accomplish the adjustments to the required level of primary security due to the cession of less than 100% of the risk.
 The adjustments for other reinsurance will be made only with respect to reinsurance treaties entered into directly by the ceding insurer. The ceding insurer will make no adjustment as a result of a retrocession treaty entered into by the assuming insurers.
 5. In no event will the required level of primary security resulting from application of the actuarial method exceed the amount of statutory reserves ceded.
 6. If the ceding insurer cedes risks with respect to covered policies, including any riders, in more than one reinsurance treaty subject to this chapter, in no event will the aggregate required level of primary security for those reinsurance treaties be less than the required level of primary security calculated using the actuarial method as if all risks ceded in those treaties were ceded in a single treaty subject to this chapter.
 7. If a reinsurance treaty subject to this chapter cedes risk on both covered and noncovered policies, credit for the ceded reserves shall be determined as follows:
 a. The actuarial method shall be used to determine the required level of primary security for the covered policies, and  14VAC5-318-60  shall be used to determine the reinsurance credit for the covered policy reserves; and
 b. Credit for the noncovered policy reserves shall be granted only to the extent that security, in addition to the security held to satisfy the requirements of subdivision A 7 a of this section, is held by or on behalf of the ceding insurer in accordance with §§  38.2-1316.2  and  38.2-1316.4  of the Code of Virginia,  14VAC5-300-90  C,  14VAC5-300-100 , and  14VAC5-300-150  B and C. Any primary security used to meet the requirements of this subdivision may not be used to satisfy the required level of primary security for the covered policies.
 B. For the purposes of both calculating the required level of primary security pursuant to the actuarial method and determining the amount of primary security and other security, as applicable, held by or on behalf of the ceding insurer, the following shall apply:
 1. For assets, including any such assets held in trust, that would be admitted under the NAIC Accounting Practices and Procedures Manual if they were held by the ceding insurer, the valuations are to be determined according to statutory accounting procedures as if such assets were held in the ceding insurer's general account and without taking into consideration the effect of any prescribed or permitted practices; and
 2. For all other assets, the valuations are to be those that were assigned to the assets for the purpose of determining the amount of reserve credit taken. In addition, the asset spread tables and asset default cost tables required by VM-20 shall be included in the actuarial method if adopted by the NAIC Life Actuarial (A) Task Force no later than the December 31st on or immediately preceding the valuation date for which the required level of primary security is being calculated. The tables of asset spreads and asset default costs shall be incorporated into the actuarial method in the manner specified in VM-20.  Statutory Authority  §§  12.1-13 ,  38.2-223 , and  38.2-1316.7  of the Code of Virginia.  Historical Notes  Derived from Virginia Register  Volume 34, Issue 9 , eff. January 1, 2018.    14VAC5-318-60. Requirements applicable to covered policies to obtain credit for reinsurance; opportunity for remediation.  A. Subject to the exemptions described in  14VAC5-318-40  and the provisions of subsection B of this section, credit for reinsurance shall be allowed with respect to ceded liabilities pertaining to covered policies pursuant to §  38.2-1316.2  of the Code of Virginia,  14VAC5-300-90  C,  14VAC5-300-100 , and  14VAC5-300-150  B and C, or §  38.2-1316.4  of the Code of Virginia if, and only if, in addition to all other requirements imposed by law or regulation, the following requirements are met on a treaty-by-treaty basis:
 1. The ceding insurer's statutory policy reserves with respect to the covered policies are established in full and in accordance with the applicable requirements of Article 10 (§  38.2-1365  et seq.) of Chapter 13 of Title 38.2 of the Code of Virginia and related regulations and actuarial guidelines, and credit claimed for any reinsurance treaty subject to this chapter does not exceed the proportionate share of those reserves ceded under the contract;
 2. The ceding insurer determines the required level of primary security with respect to each reinsurance treaty subject to this chapter and provides support for its calculation as determined to be acceptable to the commission;
 3. Funds consisting of primary security, in an amount at least equal to the required level of primary security, are held by or on behalf of the ceding insurer, as security under the reinsurance treaty within the meaning of §  38.2-1316.4  of the Code of Virginia, on a funds withheld, trust, or modified coinsurance basis;
 4. Funds consisting of other security, in an amount at least equal to any portion of the statutory reserves as to which primary security is not held pursuant to subdivision 3 of this subsection, are held by or on behalf of the ceding insurer as security under the reinsurance treaty within the meaning of §  38.2-1316.4  of the Code of Virginia;
 5. Any trust used to satisfy the requirements of this section shall comply with all of the conditions and qualifications of  14VAC5-300-120 , except that:
 a. Funds consisting of primary security or other security held in trust shall for the purposes identified in  14VAC5-318-50  B be valued according to the valuation rules set forth in  14VAC5-318-50  B, as applicable;
 b. There are no affiliate investment limitations with respect to any security held in such trust if such security is not needed to satisfy the requirements of subdivision 3 of this subsection;
 c. The reinsurance treaty must prohibit withdrawals or substitutions of trust assets that would leave the fair market value of the primary security within the trust when aggregated with primary security outside the trust that is held by or on behalf of the ceding insurer in the manner required by subdivision 3 of this subsection below 102% of the level required by subdivision 3 of this subsection at the time of the withdrawal or substitution; and
 d. The determination of reserve credit under  14VAC5-300-120  D shall be determined according to the valuation rules set forth in  14VAC5-318-50  B, as applicable; and
 6. The reinsurance treaty has been approved by the commission.
 B. Requirements at inception date and on an on-going basis; remediation.
 1. The requirements of subsection A of this section must be satisfied as of the date that risks under covered policies are ceded if such date is on or after January 1, 2018, and on an ongoing basis thereafter. Under no circumstances shall a ceding insurer take or consent to any action or series of actions that would result in a deficiency under subdivision A 3 or A 4 of this section with respect to any reinsurance treaty under which covered policies have been ceded, and in the event that a ceding insurer becomes aware at any time that such a deficiency exists, it shall use its best efforts to arrange for the deficiency to be eliminated as expeditiously as possible.
 2. Prior to the due date of each quarterly or annual statement, each life insurance company that has ceded reinsurance within the scope of  14VAC5-318-20  shall perform an analysis, on a treaty-by-treaty basis, to determine, as to each reinsurance treaty under which covered policies have been ceded, whether as of the end of the immediately preceding calendar quarter (the valuation date) the requirements of subdivision A 3 or A 4 of this section were satisfied. The ceding insurer shall establish a liability equal to the excess of the credit for reinsurance taken over the amount of primary security actually held pursuant to subdivision A 3 of this section, unless either:
 a. The requirements of subdivision A 3 or A 4 of this section were fully satisfied as of the valuation date as to such reinsurance treaty; or
 b. Any deficiency has been eliminated before the due date of the quarterly or annual statement to which the valuation date relates through the addition of primary security or other security, as the case may be, in such amount and in such form as would have caused the requirements of subdivision A 3 or A 4 of this section to be fully satisfied as of the valuation date.
 3. Nothing in subdivision 2 of this subsection shall be construed to allow a ceding company to maintain any deficiency under subdivision A 3 or A 4 of this section for any period of time longer than is reasonably necessary to eliminate it.   Statutory Authority  §§  12.1-13 ,  38.2-223 , and  38.2-1316.7  of the Code of Virginia.  Historical Notes  Derived from Virginia Register  Volume 34, Issue 9 , eff. January 1, 2018.    14VAC5-318-70. Prohibition against avoidance.  No insurer that has covered policies to which this chapter applies, as set forth in  14VAC5-318-20 , shall take any action or series of actions or enter into any transaction, arrangement, or series of transactions or arrangements if the purpose of such action, transaction, arrangement, or series thereof is to avoid the requirements of this chapter or to circumvent its purpose and intent, as set forth in  14VAC5-318-10 .   Statutory Authority  §§  12.1-13 ,  38.2-223 , and  38.2-1316.7  of the Code of Virginia.  Historical Notes  Derived from Virginia Register  Volume 34, Issue 9 , eff. January 1, 2018.    14VAC5-318-80. Severability.  If any provision of this chapter or the application thereof to any person or circumstance is for any reason held to be invalid, the remainder of the chapter and the application of the provision to other persons or circumstances shall not be affected thereby.   Statutory Authority  §§  12.1-13 ,  38.2-223 , and  38.2-1316.7  of the Code of Virginia.  Historical Notes  Derived from Virginia Register  Volume 34, Issue 9 , eff. January 1, 2018.
                     Website addresses provided in the Virginia Administrative Code to documents incorporated by reference are for the reader's convenience only, may not necessarily be active or current, and should not be relied upon. To ensure the information incorporated by reference is accurate, the reader is encouraged to use the source document described in the regulation.
                     As a service to the public, the Virginia Administrative Code is provided online by the Virginia General Assembly. We are unable to answer legal questions or respond to requests for legal advice, including application of law to specific fact. To understand and protect your legal rights, you should consult an attorney.

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Documents Incorporated by Reference (14VAC5-321)

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                   Table of Contents   »  Title 14. Insurance  »  Agency 5. State Corporation Commission, Bureau of Insurance  »  Chapter 321. Use of the 2001 CSO Mortality Table in Determining Reserve Liabilities and Nonforfeiture Benefits

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                      Chapter 321. Use of the 2001 CSO Mortality Table in Determining Reserve Liabilities and Nonforfeiture Benefits  14VAC5-321-10. Authority.  This chapter is promulgated by the commission, pursuant to §  38.2-223  of the Code of Virginia and in accordance with §§   38.2-1369 ,  38.2-3206  through  38.2-3209 , and  38.2-4120  of the Code of Virginia and  14VAC5-319-40 , to approve, recognize, permit, and prescribe the use of the 2001 Commissioners Standard Ordinary (CSO) Mortality Table by and for insurers transacting the business of insurance in this Commonwealth.   Statutory Authority  §§  12.1-13  and  38.2-223  of the Code of Virginia.  Historical Notes  Derived from Virginia Register  Volume 20, Issue 16 , eff. July 1, 2004; amended, Virginia Register  Volume 23, Issue 10 , eff. January 1, 2007;  Volume 31, Issue 9 , eff. January 1, 2015.    14VAC5-321-20. Definitions.  The following words and terms when used in this chapter shall have the following meanings unless the context clearly indicates otherwise:
 "2001 CSO Mortality Table" means that mortality table, which is included in the Proceedings of the NAIC (2nd Quarter 2002), consisting of separate rates of mortality for male and female lives, developed by the American Academy of Actuaries CSO Task Force from the Valuation Basic Mortality Table developed by the Society of Actuaries Individual Life Insurance Valuation Mortality Task Force, and adopted by the NAIC in December 2002. Unless the context indicates otherwise, the "2001 CSO Mortality Table" includes both the ultimate form of that table and the select and ultimate form of that table and includes both the smoker and nonsmoker mortality tables and the composite mortality tables. It also includes both the age-nearest-birthday and age-last-birthday bases of the mortality tables. The 2001 CSO Mortality Table may be accessed via the  Society of Actuaries' website,   https://mort.soa.org/ .
 "2001 CSO Mortality Table (F)" means that mortality table consisting of the rates of mortality for female lives from the 2001 CSO Mortality Table.
 "2001 CSO Mortality Table (M)" means that mortality table consisting of the rates of mortality for male lives from the 2001 CSO Mortality Table.
 "Commission" means the State Corporation Commission.
 "Composite mortality tables" means mortality tables with rates of mortality that do not distinguish between smokers and nonsmokers.
 "NAIC" means the National Association of Insurance Commissioners.
 "Smoker and nonsmoker mortality tables" means mortality tables with separate rates of mortality for smokers and nonsmokers.   Statutory Authority  §§  12.1-13  and  38.2-223  of the Code of Virginia.  Historical Notes  Derived from Virginia Register  Volume 20, Issue 16 , eff. July 1, 2004; amended, Virginia Register  Volume 23, Issue 10 , eff. January 1, 2007;  Volume 37, Issue 4 , eff. October 12, 2020.    14VAC5-321-30. 2001 CSO Mortality Table.  A. At the election of the insurer for any one or more specified plans of insurance and subject to the conditions stated in this chapter, the 2001 CSO Mortality Table may be used as the minimum standard for policies issued on or after January 1, 2004, and before the date specified in subsection B of this section to which subdivision 1 of §  38.2-1369  and §  38.2-3209  of the Code of Virginia are applicable. If the insurer elects to use the 2001 CSO Mortality Table, it shall do so for both valuation and nonforfeiture purposes.
 B. Subject to the conditions stated in this chapter, the 2001 CSO Mortality Table shall be used in determining minimum standards for policies issued on and after January 1, 2009, to which subdivision 1 of §  38.2-1369  and §  38.2-3209  of the Code of Virginia are applicable.
 C. A table from the 2001 CSO Preferred Class Structure Mortality Table used in place of a 2001 CSO Mortality Table, pursuant to the requirements of  14VAC5-322 , will be treated as part of the 2001 CSO Mortality Table only for purposes of reserve valuation pursuant to the requirements of this chapter.  Statutory Authority  §§  12.1-13  and  38.2-223  of the Code of Virginia.  Historical Notes  Derived from Virginia Register  Volume 20, Issue 16 , eff. July 1, 2004; amended, Virginia Register  Volume 23, Issue 10 , eff. January 1, 2007;  Volume 26, Issue 9 , eff. December 31, 2009;  Volume 31, Issue 9 , eff. January 1, 2015.    14VAC5-321-40. Conditions.  A. For policies issued on or after July 1, 2004, with each plan of insurance with separate rates for smokers and nonsmokers an insurer may use:
 1. Composite mortality tables to determine minimum reserve liabilities and minimum cash surrender values and amounts of paid-up nonforfeiture benefits;
 2. Smoker and nonsmoker mortality tables to determine the valuation net premiums and additional minimum reserves, if any, required by §   38.2-1376  of the Code of Virginia and use composite mortality tables to determine the basic minimum reserves, minimum cash surrender values, and amounts of paid-up nonforfeiture benefits; or
 3. Smoker and nonsmoker mortality tables to determine minimum reserve liabilities and minimum cash surrender values and amounts of paid-up nonforfeiture benefits.
 B. For policies issued on or after July 1, 2004, with plans of insurance without separate rates for smokers and nonsmokers the composite mortality tables shall be used.
 C. For the purpose of determining minimum reserve liabilities and minimum cash surrender values and amounts of paid-up nonforfeiture benefits, the 2001 CSO Mortality Table may, at the option of the insurer for each such plan of insurance, be used in its ultimate or select and ultimate form, subject to the restrictions of  14VAC5-321-50  and  14VAC5-319  relative to use of the select and ultimate form.
 D. When the 2001 CSO Mortality Table is the minimum reserve standard for any plan for an insurer, any actuarial opinion in the annual statement filed with the commission shall be based on an asset adequacy analysis that meets the standards and satisfies requirements for an asset adequacy analysis performed pursuant to subdivision A 2 of §   38.2-1367  of the Code of Virginia and rules governing actuarial opinions and memoranda at  14VAC5-310 .   Statutory Authority  §§  12.1-13  and  38.2-223  of the Code of Virginia.  Historical Notes  Derived from Virginia Register  Volume 20, Issue 16 , eff. July 1, 2004;  amended, Virginia Register  Volume 31, Issue 9 , eff. January 1, 2015.    14VAC5-321-50. Applicability of the 2001 CSO Mortality Table to 14VAC5-319.  A. The 2001 CSO Mortality Table may be used in applying rules at  14VAC5-319 , concerning life insurance reserves, in the following manner, subject to the transition dates for use of the 2001 CSO Mortality Table in  14VAC5-321-30 .
 1. When applying  14VAC5-319-30  B 2, the net level reserve premium is based on the ultimate mortality rates in the 2001 CSO Mortality Table.
 2. When determining "contract segmentation method" as defined by  14VAC5-319-10 , all calculations are made using the 2001 CSO mortality rate, and, if elected, the optional minimum mortality standard for deficiency reserves stipulated in subdivision 4 of this subsection. The value of "q x+k+t-1 " is the valuation mortality rate for deficiency reserves in policy year k+t, but using the unmodified select mortality rates if modified select mortality rates are used in the computation of deficiency reserves.
 3. When applying  14VAC5-319-40  A, the 2001 CSO Mortality Table is the minimum standard for basic reserves.
 4. When applying  14VAC5-319-40  B, the 2001 CSO Mortality Table is the minimum standard for deficiency reserves. If select mortality rates are used, they may be multiplied by X percent for durations in the first segment, subject to the conditions specified in subdivisions 1 c, 1 d, 2, and 3 of  14VAC5-319-40  B. In demonstrating compliance with those conditions, the demonstrations may not combine the results of tests that utilize the 1980 CSO Mortality Table with those tests that utilize the 2001 CSO Mortality Table, unless the combination is explicitly required by regulation or necessary to be in compliance with relevant Actuarial Standards of Practice.
 5. When applying  14VAC5-319-50  C, the valuation mortality table used in determining the tabular cost of insurance shall be the ultimate mortality rates in the 2001 CSO Mortality Table.
 6. When applying  14VAC5-319-50  E 4, the calculations specified in  14VAC5-319-50  E shall use the ultimate mortality rates in the 2001 CSO Mortality Table.
 7. When applying  14VAC5-319-50  F 4, the calculations specified in  14VAC5-319-50  F shall use the ultimate mortality rates in the 2001 CSO Mortality Table.
 8. When applying  14VAC5-319-50  G 2, the calculations specified in  14VAC5-319-50  G shall use the ultimate mortality rates in the 2001 CSO Mortality Table.
 9. When applying  14VAC5-319-60  A 1 b, the one-year valuation premium shall be calculated using the ultimate mortality rates in the 2001 CSO Mortality Table.
 B. Nothing in this section shall be construed to expand the applicability of  14VAC5-319  to include life insurance policies excepted from regulation pursuant to  14VAC5-319-30  B.   Statutory Authority  §§  12.1-13  and  38.2-223  of the Code of Virginia.  Historical Notes  Derived from Virginia Register  Volume 20, Issue 16 , eff. July 1, 2004.    14VAC5-321-60. Gender-blended tables.    A. For any ordinary life insurance policy delivered or issued for delivery in this Commonwealth on and after July 1, 2004, that utilizes the same premium rates and charges for male and female lives or is issued in circumstances where applicable law does not permit distinctions on the basis of gender, a mortality table that is a blend of the 2001 CSO Mortality Table (M) and the 2001 CSO Mortality Table (F) may, at the option of the insurer for each plan of insurance, be substituted for the 2001 CSO Mortality Table for use in determining minimum cash surrender values and amounts of paid-up nonforfeiture benefits.  No change in minimum valuation standards is implied by this subsection.     B. When applying subsection A of this section, the insurer may choose from among the blended tables developed by the American Academy of Actuaries CSO Task Force and adopted by the NAIC in December 2002.     C. It shall not, in and of itself, be a violation of §  38.2-508  or §  38.2-508.2  of the Code of Virginia concerning respectively, unfair discrimination and discrimination prohibited, for an insurer to issue the same kind of policy of life insurance on both a sex-distinct and sex-neutral basis.   Statutory Authority  §§  12.1-13  and  38.2-223  of the Code of Virginia.  Historical Notes  Derived from Virginia Register  Volume 20, Issue 16 , eff. July 1, 2004.    14VAC5-321-70. Severability clause.    If any provision of this chapter or the application thereof to any person or circumstance is for any reason held to be invalid, the remainder of the chapter and the application of the provision to other persons or circumstances shall not be affected thereby.   Statutory Authority  §§  12.1-13  and  38.2-223  of the Code of Virginia.  Historical Notes  Derived from Virginia Register  Volume 23, Issue 10 , eff. January 1, 2007.    Documents Incorporated by Reference (14VAC5-321)   2001 CSO Mortality Table, American Academy of Actuaries, June 2002.
                     Website addresses provided in the Virginia Administrative Code to documents incorporated by reference are for the reader's convenience only, may not necessarily be active or current, and should not be relied upon. To ensure the information incorporated by reference is accurate, the reader is encouraged to use the source document described in the regulation.
                     As a service to the public, the Virginia Administrative Code is provided online by the Virginia General Assembly. We are unable to answer legal questions or respond to requests for legal advice, including application of law to specific fact. To understand and protect your legal rights, you should consult an attorney.

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14VAC5-330-10. (Repealed.)

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                   Table of Contents   »  Title 14. Insurance  »  Agency 5. State Corporation Commission, Bureau of Insurance  »  Chapter 330. Reporting of Salvage and Subrogation Recoveries [Repealed]

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                      Chapter 330. Reporting of Salvage and Subrogation Recoveries [Repealed]  14VAC5-330-10. (Repealed.)    Historical Notes     Derived from Regulation 11, Case No. 19948, eff. February 7, 1978; repealed, Virginia Register Volume 18, Issue 3, eff. December 31, 2001.
                     Website addresses provided in the Virginia Administrative Code to documents incorporated by reference are for the reader's convenience only, may not necessarily be active or current, and should not be relied upon. To ensure the information incorporated by reference is accurate, the reader is encouraged to use the source document described in the regulation.
                     As a service to the public, the Virginia Administrative Code is provided online by the Virginia General Assembly. We are unable to answer legal questions or respond to requests for legal advice, including application of law to specific fact. To understand and protect your legal rights, you should consult an attorney.

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