Statutory Accounting
Definition of "Statutory accounting"
Rules that insurance companies must follow in filing an annual financial statement known as the convention blank, with state insurance departments. The reported financial condition of an insurance company can differ markedly depending on whether statutory accounting rules or generally accepted accounting principles (gaap) are used in preparing financial statements. In general, statutory accounting is more conservative than GAAP because it tends to overstate expenses and liabilities while understating income and assets.
Popular Insurance Terms
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Statutory liabilities minus the interest MAINTENANCE RESERVE minus the ASSET VALUATION RESERVE. ...
Adjustment in property insurance to reflect increased construction costs. ...
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Coverage for an insured who unknowingly accepts forged checks. ...
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