Pennsylvania Code › Title 31 - INSURANCE › Part IV - Life Insurance › Chapter 84d - RECOGNITION OF THE 2001 CSO MORTALITY TABLE FOR USE IN DETERMINING MINIMUM RESERVE LIABILITIES AND NONFORFEITURE BENEFITS AND THE 2001 CSO PREFERRED CLASS STRUCTURE MORTALITY TABLE FOR USE IN DETERMINING MINIMUM RESERVE LIABILITIES › Section 84d.4 - Applicability of the 2001 CSO Mortality Table to Chapter 84c (relating to valuation of life insurance policies)

Current through Register Vol. 54, No. 28, July 13, 2024
(a)
				The 2001 CSO Mortality Table shall be used in applying Chapter 84c (relating to
				valuation of life insurance policies) in the following manner, subject to the
				transition dates for use of the 2001 CSO Mortality Table in §
									84d.3(a)
				(relating to 2001 CSO Mortality Table) and § 84d.3(b).
(1) The net level reserve premium referenced
				in §
										84c.2(b)(2)(ii)
				(relating to applicability) shall be based on the ultimate mortality rates in
				the 2001 CSO Mortality Table.
(2)
				All calculations in §
										84c.4(b)(1) 
				(relating to segmented and unitary reserve methods) shall be made using the
				2001 CSO Mortality Table. The value of "qx+k+t-1" is the valuation mortality
				rate for deficiency reserves in policy year k+t, but using the unmodified
				select mortality rates if modified select mortality rates are used in the
				computation of deficiency reserves.
(3) The basic reserves minimum standard in
				§
										84c.5(a)
				(relating to general requirements for basic reserves and premium deficiency
				reserves) shall be the 2001 CSO Mortality Table.
(4) The deficiency reserves minimum standard
				in §
										84c.5(b) shall be
				the 2001 CSO Mortality Table. If select mortality rates are used, they may be
				multiplied by X% for durations in the first segment, subject to the conditions
				specified in §
										84c.5(b)(3)(i)-(ix).
				In demonstrating compliance with those conditions, the demonstrations may not
				combine the results of tests that utilize the 1980 CSO Mortality Table with
				those tests that utilize the 2001 CSO Mortality Table, unless the combination
				is explicitly required by regulation or necessary to be in compliance with
				relevant standards of practice as promulgated by the Actuarial Standards
				Board.
(5) The valuation mortality
				table used in determining the tabular cost of insurance in §
										84c.6(c) 
				(relating to minimum valuation standard for policies with guaranteed nonlevel
				gross premiums or guaranteed nonlevel benefits (other than universal life
				policies)) shall be the ultimate mortality rates in the 2001 CSO Mortality
				Table.
(6) The calculations
				specified in §
										84c.6(e)(4) shall
				use the ultimate mortality rates in the 2001 CSO Mortality Table.
(7) The calculations specified in §
										84c.6(f)(4) shall
				use the ultimate mortality rates in the 2001 CSO Mortality Table.
(8) The net premiums referenced in §
										84c.6(g)(2) shall
				be calculated using the ultimate mortality rates in the 2001 CSO Mortality
				Table.
(9) The 1-year valuation
				premium in §
										84c.7(a)(1)(ii)
				(relating to minimum valuation standard for universal life insurance policies
				that contain provisions resulting in the ability of a policy owner to keep a
				policy in force over a secondary guarantee period) shall be calculated using
				the ultimate mortality rates in the 2001 CSO Mortality
				Table.