Standard Valuation Law
Kentucky · Insurance Code · §§ 304.6-005 to 304.6-190 · 30 sections
Overview
The Standard Valuation Law governs how insurers value the liabilities carried on their statutory financial statements, setting minimum reserve standards across lines of business — life, annuity and endowment, accident and health, casualty, title, mortgage guaranty, and unearned premium reserves including marine and transportation — and defining which assets may be admitted in that accounting. It prescribes the methods used to compute reserves, including the commissioners reserve valuation method and a principle-based valuation framework operating under a valuation manual, and requires insurers to maintain aggregate, contingency, and deficiency reserves and to file an annual actuarial opinion attesting that reserves are appropriately computed and comply with state law. It also frames the regulator's supporting authority: required data submissions and their confidential treatment, exemptions for particular products or product lines, penalties for transactions that misstate asset positions, and rulemaking to implement the standards.
Editorial summary generated from the text of this act. It is not part of the statute — read the sections below for the operative language.
In the courts
Sections of this act have been cited in 5 court decisions.
Most-cited authority: 294 SW3D 10 - Monumental Life Insurance Co. v. Department of Revenue
Sections covered
- KRS 304.6-005"Accounting practices and procedures manual" and "SSAP" defined
- KRS 304.6-010"Assets" defined1 cite
- KRS 304.6-020Assets not allowed
- KRS 304.6-030Use of "wash" transactions -- Penalty
- KRS 304.6-040Liabilities, in general3 cites
- KRS 304.6-050Unearned premium reserve
- KRS 304.6-060Unearned premium reserve for marine and transportation insurance
- KRS 304.6-070Health insurance policy reserves
- KRS 304.6-080Title insurance reserves
- KRS 304.6-090Mortgage guaranty insurer to maintain statutory contingency reserve -- Release
- KRS 304.6-100Loss reserves -- Casualty insurance1 cite
- KRS 304.6-110Loss reserve -- Mortgage guaranty insurance
- KRS 304.6-120Short title
- KRS 304.6-130Calculation of reserve liabilities -- Application -- Exceptions -- Annual valuation
- KRS 304.6-131Definitions for KRS 304.6-130 to 304.6-180
- KRS 304.6-132Treatment of confidential information
- KRS 304.6-133Submission of required data -- Effective date of changes
- KRS 304.6-134Exemption of specific product forms or product lines
- KRS 304.6-140Minimum standards
- KRS 304.6-141Accident and health insurance contracts issued on or after the operative date of the valuation manual -- Application of KRS 304.6-130(2) minimum standard of valuation
- KRS 304.6-143Policies issued on or after the operative date of the valuation manual -- Application of KRS 304.6-130(2) minimum standard of valuation
- KRS 304.6-145Minimum standards -- Operative dates
- KRS 304.6-150Commissioners reserve valuation method defined
- KRS 304.6-151Principle-based valuation -- Required actions
- KRS 304.6-155Annuity and endowment contracts other than group annuity
- KRS 304.6-160Amount of aggregate reserves
- KRS 304.6-170Calculation of reserves
- KRS 304.6-171Requirement for actuarial opinion as to appropriate computation of reserves and related items and compliance with state law -- Opinions to be submitted annually -- Form and substance of opinions -- Administrative regulations
- KRS 304.6-180Deficiency reserve -- Recognition of premium deficiency reserve
- KRS 304.6-190Appraisals for mortgage loans
Enacted in other states
Alabama, Arkansas, California, Connecticut, Delaware, Florida, Georgia, Iowa, Minnesota, Mississippi, North Carolina, New Hampshire, New Mexico, Rhode Island, Tennessee, Texas, Vermont
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