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Statutory Reserves

Definition of "Statutory reserves"

Norman "John" Johnson
  Coldwell Banker Anderson Realtors

Reserves required by state regulators. Because regulators must assure that an insurance company remains solvent and that it can pay future claims, they set conservative standards for insurer reserves. Regulators have various formulas for valuing reserves, such as the loss frequency method and the Commissioners Reserve Valuation Method.

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