{"data":{"id":"us-ky/krs-304.6-143","jurisdiction":"us-ky","citation":"KRS 304.6-143","heading":"Policies issued on or after the operative date of the valuation manual --","body":"Application of KRS 304.6-130(2) minimum standard of valuation.\n(1) For policies issued on or after the operative date of the valuation manual, the\nstandard prescribed in the  valuation manual shall be the minimum standard of\nvaluation required under KRS 304.6-130(2), except as provided by subsection (5) or\n(7) of this section.\n(2) The operative date of the valuation manual shall be January 1 of the first calendar\nyear following the first July 1, at which time all of the following have occurred:\n(a) The valuation manual has been adopted by the NAIC by an affirmative vote of\nat least forty-two (42) members, or three -fourths (3/4) of the members voting,\nwhichever is greater;\n(b) The Standard Valuation Law, as amended by the NAIC in 2009, or legislation\nincluding substantially similar terms and provisions, has been enacted by\nstates representing greater than seventy -five percent (75%) of the direct\npremiums written as reported in the following annual statements submitted for\n2008:\n1. Life, accident and health insurance;\n2. Health insurance; or\n3. Fraternal benefit societies, as defined in KRS 304.29 -011, insurance;\nand\n(c) The Standard Valuation Law, as amended by the NAIC in 2009, o r legislation\nincluding substantially similar terms and provisions, has been enacted in by at\nleast forty-two (42) of the fifty-five (55) jurisdictions, including:\n1. The fifty (50) states of the United States;\n2. American Samoa;\n3. The American Virgin Islands;\n4. The District of Columbia;\n5. Guam; and\n6. Puerto Rico.\n(3) (a) Unless a change in the valuation manual specifies a later effective date,\nchanges to the valuation manual shall be effective on January 1 following the\ndate when all of the following have occurred:\n1. The change to the valuation manual has been adopted by the NAIC by an\naffirmative vote representing:\na. At least three -fourths (3/4) of the members of the NAIC voting,\nbut not less than a majority of the total membership; and\nb. Members of the NAIC representing jurisdictions totaling greater\nthan seventy-five percent (75%) of the direct premiums written as\nreported in the following annual statements most recently available\nprior to the vote required by subparagraph 1. of this paragraph:\ni. Life, accident and health insurance;\nii. Health insurance; or\niii. Fraternal benefit societies, as defined in KRS 304.29 -011,\ninsurance; or\n(b) The valuation manual becomes effective pursuant to an order by the\ncommissioner.\n(4) The valuation manual shall specify the following:\n(a) Minimum valuation standards for and definitio ns of the policies or contracts\nsubject to KRS 304.6-130(2). The minimum valuation standards shall be:\n1. The commissioner's reserve valuation method for life insurance\ncontracts, other than annuity contracts;\n2. The commissioner's annuity valuation method for annuity contracts; and\n3. Minimum reserves for all other policies or contracts.\n(b) Which policies or contracts or types of policies or contracts that are subject to\nthe requirements of a principle -based valuation, required by KRS 304.6 -\n151(1), and th e minimum valuation standards consistent with those\nrequirements;\n(c) For policies and contracts subject to a principle -based valuation under KRS\n304.6-151(2)(c):\n1. Requirements for the format of the reports to the commissioner,\nincluding information nece ssary to determine if the valuation is\nappropriate and in compliance with KRS 304.6-130 to 304.6-180;\n2. Assumptions to be prescribed for risks over which the company does not\nhave significant control or influence; and\n3. Procedures for corporate governanc e and oversight of the actuarial\nfunction, and a process for appropriate waiver or modification of the\nprocedures;\n(d) For policies not subject to a principle -based valuation under KRS 304.6 -151,\nthe minimum valuation standard shall either:\n1. Be consisten t with the minimum standard of valuation prior to the\noperative date of the valuation manual; or\n2. Develop reserves that quantify the benefits and guarantees, and the\nfunding associated with the contracts and their risks at a level of\nconservatism that reflects conditions that include unfavorable events that\nhave a reasonable probability of occurring;\n(e) Other requirements, including but not limited to:\n1. Those relating to reserve methods;\n2. Models for measuring risk;\n3. Generation of economic scenarios;\n4. Assumptions;\n5. Margins;\n6. Use of company experience;\n7. Risk measurement;\n8. Disclosure;\n9. Certifications;\n10. Reports;\n11. Actuarial opinions and memorandums;\n12. Transition rules; and\n13. Internal controls; and\n(f) The data and form of the data required by KRS 304.6 -133 and with whom the\ndata shall be submitted, and may specify other requirements including data\nanalyses and reporting of analyses.\n(5) In the absence of a specific valuation requirement or if a specifi c valuation\nrequirement in the valuation manual is not, in the opinion of the commissioner, in\ncompliance with KRS 304.6 -151, the company shall, with respect to the\nrequirements, comply with minimum valuation standards prescribed by the\ncommissioner by administrative regulation.\n(6) The commissioner may engage a qualified actuary, at the expense of the company,\nto perform an actuarial examination of the company and to opine on the\nappropriateness of a reserve assumption or method used by the company, or to\nreview and opine on a company's compliance with any requirement set forth in KRS\n304.6-130 to 304.6-180. The commissioner may rely upon the opinion of a qualified\nactuary, regarding KRS 304.6 -130 to 304.6 -180, who is engaged by the\ncommissioner of another state, district, or territory of the United States. As used in\nthis subsection, the term \"engage\" includes employment or contracting.\n(7) The commissioner may require a company to change any assumption or method that\nin the opinion of the commissioner is n ecessary to comply with the requirement of\nthe valuation manual or KRS 304.6-130 to 304.6-180. The company shall adjust the\nreserves as required by the commissioner. The commissioner may take other\ndisciplinary action as permitted under this subtitle.","path":[],"source_url":"https://apps.legislature.ky.gov/law/statutes/statute.aspx?id=44429","current_through":"Includes enactments through the 2026 Regular Session","vintage":"09/05/2026","retrieved_at":"2026-09-05T20:57:38Z","sha256":"72df1a87486b33d1657301442380da5d98aeeeb3d2ab75af69b1cc34c6b43b4f","source_id":"us-ky","stale":false,"prev":"us-ky/krs-304.6-141","next":"us-ky/krs-304.6-145"},"notice":"GroundRules: Original legal text. Not legal advice."}