Ala. Admin. Code r. 482-1-060-.01
The purpose and intent of this chapter is to prevent certain companies from reflecting values in their annual statements in a manner which produces a less conservative approach than reflected in their last report of examination. Companies will not be allowed to overstate assets or underestimate liabilities in the future by reflecting assets on a higher valuation basis or listing liabilities at amounts smaller than calculated by examiners unless the basis of calculation used by the examiners in the report of examination now produces these different values. For example, the market value of a security as valued under requirements stated in Regulation 98 may later reflect a higher valuation. Nothing in this chapter shall prevent the company from using this higher market value. Any reserve computations which produce different reserve figures may be used if these figures are calculated in accordance with Alabama law, certified by the company's qualified actuary and if an actuary employed by this department has not disallowed this particular basis of computation on a prior examination. No increase in the market value of real estate may be allowed. Nothing in this chapter shall prevent any company from reflecting values on a more conservative basis which produces a smaller surplus as regards policyholders. At any time subsequent to an examination any asset which becomes ineligible for admission through default or any other action must then be reflected on the basis then allowed under applicable statutes.
Author: Commissioner of Insurance
Ala. Admin. Code r. 482-1-060-.01
Statutory Authority:Code of Ala. 1975, § 27-37-7.