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
Contract sold by insurance companies that pays a monthly (quarterly, semiannual, or annual) income benefit for the life of a person (the annuitant). The annuitant can never outlive the ...
method of determining the worth of property to be insured, or of property that has been lost or damaged; method of setting insurance company reserves to pay future claims ...
Rules of conduct and commissions paid to agents. For example, under the rules of conduct agents may be required to submit all of their business to only that agency. The contract also lists ...
Method of comparing the costs of a set of cash value life insurance policies that takes into account the time value of money. The true costs of alternative cash value policies with the same ...
Term describing illness, sickness, or disability incurred by the insured such that the insured is restricted to his or her home, a hospital, or a nursing home. Many health insurance ...
Detail showing distribution of property coverages written by an insurance company. Illustrates a potential danger of concentration of insured risks. ...
Period of time of insurance coverage. If a loss occurs during this time, insurance benefits are paid. If a loss occurs after this time period has expired, no insurance benefits are paid. ...
Statistical procedure applied to the data that comprises a mortality table. It is designed to smooth out the irregularities in that data believed to not be truly indicative of the ...
Act that requires the Department of Labor (DOL) to have a formal program to educate the public about the importance of saving for retirement. The DOL is also required to educate the public ...
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