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News & Press: Advocacy

New Bill Update: SB 696, Principle Based Reserving

Monday, January 4, 2016   (0 Comments)
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This law permits life insurers to use the Principle-Based Reserve (PBR) method of calculating reserves required to pay future claims for certain insurance products sold to individuals. Under this reserving method, reserves are more appropriately aligned with the risks actually assumed by an insurer, and in effect, insurance premiums are based on more refined risk analyses. National implementation of PBR requires the approval of 42 of the 55 jurisdictions within the National Association of Insurance Commissioners, representing 75 percent of relevant premium volume.

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