{"data":{"id":"us-ky/krs-304.6-171","jurisdiction":"us-ky","citation":"KRS 304.6-171","heading":"Requirement for actuarial opinion as to appropriate computation of","body":"reserves and related items and compliance with state law -- Opinions to be\nsubmitted annually -- Form and substance of opinions -- Administrative\nregulations.\n(1) Subsections (2) t o (5) of this section shall become operative at the end of the first\nfull calendar year following the year of enactment and shall be applicable prior to\nthe operative date of the valuation manual.\n(2) Every life insurance company doing business in this sta te shall annually submit the\nopinion of a qualified actuary as to whether the reserves and related actuarial items\nheld in support of the policies and contracts specified by the commissioner by\nadministrative regulation are computed appropriately, are base d on assumptions\nwhich satisfy contractual provisions, are consistent with prior reported amounts, and\ncomply with applicable laws of this state. The commissioner by administrative\nregulation shall define the specifics of this opinion and add any other ite ms deemed\nto be necessary to its scope.\n(3) (a) Every life insurance company, except as exempted by or pursuant to\nadministrative regulation, shall also annually include in the opinion required\nby subsection (2) of this section, an opinion of the same qualified actuary as to\nwhether the reserves and related actuarial items held in support of the policies\nand contracts specified by the commissioner by administrative regulation,\nwhen considered in light of the assets held by the company with respect to the\nreserves and related actuarial items, including but not limited to the\ninvestment earnings on the assets and the considerations anticipated to be\nreceived and retained under the policies and contracts, make adequate\nprovision for the company's obligations un der the policies and contracts,\nincluding but not limited to the benefits under and expenses associated with\nthe policies and contracts.\n(b) The commissioner may provide by administrative regulation for a transition\nperiod for establishing any higher reser ves which the qualified actuary may\ndeem necessary in order to render the opinion required by this section.\n(4) Each opinion required by subsection (2) of this section shall be governed by the\nfollowing provisions:\n(a) A memorandum, in form and substance a cceptable to the commissioner as\nspecified by administrative regulation, shall be prepared to support each\nactuarial opinion; and\n(b) If the insurance company fails to provide a supporting memorandum at the\nrequest of the commissioner within a period speci fied by administrative\nregulation or the commissioner determines that the supporting memorandum\nprovided by the insurance company fails to meet the standards prescribed by\nthe administrative regulations or is otherwise unacceptable to the\ncommissioner, the  commissioner may engage a qualified actuary at the\nexpense of the company to review the opinion and the basis for the opinion\nand prepare the supporting memorandum as is required by the commissioner.\n(5) Every opinion shall be governed by the following provisions:\n(a) The opinion shall be submitted with the annual statement reflecting the\nvaluation of reserve liabilities for each year ending on or after December 31,\n1996;\n(b) The opinion shall apply to business in force including individual and group\nhealth insurance plans, in form and substance acceptable to the commissioner\nas specified by administrative regulation;\n(c) The opinion shall be based on standards adopted from time to time by the\nActuarial Standards Board and on such additional standards as th e\ncommissioner may by administrative regulation prescribe;\n(d) In the case of an opinion required to be submitted by a foreign or alien\ncompany, the commissioner may accept the opinion filed by that company\nwith the insurance supervisory official of anothe r state if the commissioner\ndetermines that the opinion reasonably meets the requirements applicable to a\ncompany domiciled in this state;\n(e) For the purposes of this section, \"qualified actuary\" means a member in good\nstanding of the American Academy of Actuaries who meets the requirements\nset forth in administrative regulations;\n(f) Except in cases of fraud or willful misconduct, the qualified  actuary shall not\nbe liable for damages to any person, other than the insurance company and the\ncommissioner, for any act, error, omission, decision, or conduct with respect\nto the actuary's opinion;\n(g) Disciplinary action by the commissioner against the  company or the qualified\nactuary shall be defined in administrative regulations by the commissioner;\nand\n(h) Any memorandum in support of the opinion, and any other material provided\nby the company to the commissioner in connection therewith, shall be kep t\nconfidential by the commissioner and shall not be made public and shall not\nbe subject to subpoena, other than for the purpose of defending an action\nseeking damages from any person by reason of any action required by this\nsection or by administrative re gulations promulgated hereunder. The\nmemorandum or other material may otherwise be released by the\ncommissioner with the written consent of the company or to the American\nAcademy of Actuaries upon request stating that the memorandum or other\nmaterial is re quired for the purpose of professional disciplinary proceedings\nand setting forth procedures satisfactory to the commissioner for preserving\nthe confidentiality of the memorandum or other material. Once any portion of\nthe confidential memorandum is cited b y the company in its marketing, or is\ncited before any governmental agency other than a state insurance department\nor office, or is released by the company to the news media, all portions of the\nconfidential memorandum shall be no longer confidential.\n(6) Unless a company is exempt under KRS 304.6 -134, subsections (7) to (10) of this\nsection shall become operative after the operative date of the valuation manual.\n(7) Every company with outstanding life insurance, accident and health insurance, or\ndeposit-type contracts in this state, subject to regulation by the commissioner, shall\nannually submit the opinion of the appointed actuary stating whether the reserves\nand related actuarial items held in support of the policies and contracts are\ncomputed appropriat ely, are based on assumptions that satisfy contractual\nprovisions, are consistent with prior reported amounts, and comply with applicable\nlaws of this state. The valuation manual shall prescribe the specifics of this opinion,\nincluding any items deemed necessary to its scope.\n(8) Every company with outstanding life insurance, accident and health insurance, or\ndeposit-type contracts in this state, subject to regulation by the commissioner,\nexcept as exempted in the valuation manual, shall also annually inclu de in the\nopinion required by subsection (7) of this section an opinion of the same appointed\nactuary stating whether the reserves and related actuarial items held in support of\nthe policies and contracts specified in the valuation manual, when considered with\nrespect to the assets held by the company, the reserves, and related actuarial items,\nincluding but not limited to the investment earnings on the assets and the\nconsiderations anticipated to be received and retained under the policies and\ncontracts, m aking adequate provision for the company's obligations under the\npolicies and contracts, including but not limited to the benefits under, and expenses\nassociated with, the policies and contracts.\n(9) Each opinion required by subsection (8) of this section shall be governed by the\nfollowing provisions:\n(a) A memorandum, in the form and substance specified in the valuation manual,\nand acceptable to the commissioner, shall be prepared to support each\nactuarial opinion; and\n(b) If the insurance company fails to  provide a supporting memorandum at the\nrequest of the commissioner within a period specified in the valuation manual,\nor the commissioner determines that the supporting memorandum provided by\nthe insurance company fails to meet the standards prescribed by  the valuation\nmanual, or is otherwise unacceptable to the commissioner, the commissioner\nmay engage a qualified actuary, at the expense of the company, to review the\nopinion and the basis for the opinion, and prepare the supporting\nmemorandum required by the commissioner.\n(10) Every opinion required by subsections (7) and (8) of this section shall be governed\nby the following provisions:\n(a) The opinion shall be in the form and contain the substance specified in the\nvaluation manual and acceptable to the commissioner;\n(b) The opinion shall be submitted with the annual statement reflecting the\nvaluation of the reserve liability for each year ending on or after the operative\ndate of the valuation manual;\n(c) The opinion shall apply to all policies and contrac ts subject to subsection (8)\nof this section, plus other actuarial liabilities as may be specified in the\nvaluation manual;\n(d) The opinion shall be based on standards adopted from time to time by the\nActuarial Standards Board or its successor, and on such  additional standards\nas may be prescribed in the valuation manual;\n(e) In the case of an opinion required to be submitted by a foreign or alien\ncompany, the commissioner may accept the opinion filed by that company\nwith the insurance supervisory official of another state if the commissioner\ndetermines that the opinion reasonably meets the requirements applicable to a\ncompany domiciled in this state;\n(f) Except in cases of fraud or willful misconduct, the appointed actuary shall not\nbe liable for damages to any person, other than the insurance company and the\ncommissioner, for any act, error, omission, decision, or conduct with respect\nto the appointed actuary's opinion; and\n(g) Disciplinary action by the commissioner against the company or the appointed\nactuary shall be established by administrative regulation, promulgated by the\ncommissioner.","path":[],"source_url":"https://apps.legislature.ky.gov/law/statutes/statute.aspx?id=44438","current_through":"Includes enactments through the 2026 Regular Session","vintage":"09/05/2026","retrieved_at":"2026-09-05T20:57:38Z","sha256":"695c7b4bedb55b27017b8b2ec0485b68b1c3b344d84b568026cd86bf3db2f41e","source_id":"us-ky","stale":false,"prev":"us-ky/krs-304.6-170","next":"us-ky/krs-304.6-180"},"notice":"GroundRules: Original legal text. Not legal advice."}