Ohio Dept. Issues Bulletins for Insurer Changes

The Ohio Department of Insurance has issued bulletins permitting Ohio domiciled life insurance companies to request making changes to their minimum reserve liabilities for certain life and annuity products.

Another bulletin addresses the instructions for permitting how all Ohio-based life and property and casualty insurers may calculate and report deferred income tax assets on their financial statements. The three bulletins require companies to receive approval before implementing changes.

The bulletins are as follows:

• 2009-02 – Interpretation of the Calculation of the Segment Length with respect to the Life Insurance Model Regulation and use of the 2001 CSO Preferred Class Structure Table to Determine Basic and Minimum Reserve Liabilities

The bulletin provides guidance when a company elects to use the 2001 CSO Preferred Class Structure Table to determine minimum valuation requirements that it is permissible to use distinct versions of the table for determination of contract segments as defined in the Valuation of Life Insurance Policies Regulation.

• 2009-03 – Calculation of the Reserves of Variable Annuities that provide Guaranteed Living Benefits (“VAGLBs”) in the Preparation of Statutory Financial Statements

The bulletin modifies an actuarial guideline to interpret the standards for the valuation of reserves for guaranteed living benefits included in variable deferred and immediate annuity contracts (VAGLBs).

• 2009-04 – Calculation of the Amount of Deferred Income Tax Admitted in the Preparation of Statutory Financial Statements

The bulletin provides guidance on how life and property and casualty insurance companies can determine the admitted amount of deferred income tax assets.

The Department will monitor use of the additional capital released to the insurers through its risk assessment process to assure that it is utilized as permitted under Ohio law. These permitted practice instructions do not require that a company implement them but merely provide the option for the company to apply to do so should they have the desire and ability.

Company representatives with questions about the bulletins can call Dale Bruggeman at (614) 728-1071.