Cal. Code Regs. tit. 10 § 2510.3

Current through Register 2024 Notice Reg. No. 45, November 8, 2024

Section 2510.3 - Computation of Unearned Premium Reserve

Mortgage Guaranty insurers shall compute the unearned premium reserve on a monthly pro rata basis, except in the case of premiums paid in advance for four, five, six, seven, eight, nine, ten, eleven, twelve, thirteen, fourteen, or fifteen-year policies the annual unearned premium factors specified below shall apply (or comparable factors to be applied monthly consistent with the schedule below on the basis that one-twelfth of the earned premium for each contract year is earned during each month therein):

Unearned Premium Factor at Valuation Date*
Contract Year Current at Valuation Date	4 year Policy	5 year Policy	6 year Policy	7 year Policy	8 year Policy	9 year Policy	10 year Policy	11 year Policy	12 year Policy	13 year Policy	14 year Policy	15 year Policy
1	95.7%	96.5%	97.0%	97.3%	97.5%	97.7%	97.7%	97.8%	97.8%	97.8%	97.8%	97.8%
2	76.4	81.0	83.7	85.4	86.5	87.3	87.6	87.9	88.1	88.1	88.2	88.2
3	45.2	56.0	62.2	66.2	68.8	70.4	71.3	71.9	72.3	72.5	72.6	72.6
4	14.5	31.3	41.1	47.4	51.3	53.8	55.3	56.1	56.7	57.1	57.2	57.3
5		9.9	22.7	31.0	36.2	39.4	41.3	42.5	43.2	43.7	43.9	44.0
6			7.1	17.1	23.3	27.2	29.5	30.9	31.8	32.3	32.7	32.8
7				5.4	12.5	16.9	19.6	21.2	22.1	22.8	23.2	23.3
8					3.8	8.6	11.6	13.3	14.4	15.1	15.3	15.7
9						2.5	5.6	7.5	8.6	9.3	9.9	10.1
10							1.6	3.4	4.6	5.4	6.0	6.2
11								0.9	2.1	2.9	3.5	3.7
12									0.6	1.3	1.9	2.1
13										0.4	0.9	1.1
14											0.3	0.5
15												0.1
* Includes 50% of the earned premium applicable to the contract year current at valuation date. This is necessary if it is assumed the average policy is written in the middle of the contract year and these factors are applied annually to groups of policies segregated by policy term and expiration year.

Whenever the laws of any other jurisdiction in which a mortgage guaranty insurer subject to the requirements of this section is also licensed to transact mortgage guaranty insurance require a larger unearned premium reserve in the aggregate than that set forth herein, the establishment of such larger unearned premium reserve shall be deemed to be compliance with this section.

Cal. Code Regs. Tit. 10, § 2510.3

1. Amendment filed 10-25-74; designated effective 1-1-75 (Register 74, No. 43).
2. Renumbering of Section 2513 to Section 2510.3 filed 8-23-78; effective thirtieth day thereafter (Register 78, No. 34).

1. Amendment filed 10-25-74; designated effective 1-1-75 (Register 74, No. 43).
2. Renumbering of Section 2513 to Section 2510.3 filed 8-23-78; effective thirtieth day thereafter (Register 78, No. 34).