Or. Admin. Code § 836-052-0656

Current through Register Vol. 63, No. 12, December 1, 2024

Section 836-052-0656 - Reserve Standards

(1)

(a) Each insurer shall use the following standards for determining policy reserves for long-term care insurance: When long-term care benefits are provided through the acceleration of benefits under a group or individual life insurance policy or a rider to such a policy, policy reserves for the benefits shall be determined in accordance with ORS 733.322. Claim reserves shall also be established in the case when the policy or rider is in claim status.

(b) Reserves for policies and riders subject to this section shall be based on the multiple decrement model using all relevant decrements except for voluntary termination rates. Single decrement approximations are acceptable if the calculation produces essentially similar reserves, if the reserve is clearly more conservative or if the reserve is immaterial. The calculations may take into account the reduction in life insurance benefits due to the payment of long-term care benefits. However, in no event shall the reserves for the long-term care benefit and the life insurance benefit be less than the reserves for the life insurance benefit assuming no long-term care benefit.

(c) In the development and calculation of reserves for long-term care insurance policies and riders subject to this section, an insurer shall consider the applicable policy and rider provisions, marketing methods, administrative procedures and all other considerations that affect projected claim costs, including but not limited to the following:

(A) Definition of insured events;

(B) Covered long-term care facilities;

(C) Existence of home care and home care coverage. For purposes of this paragraph, "home" has the meaning provided in OAR 836-052-0606;

(D) Definition of facilities;

(E) Existence or absence of barriers to eligibility;

(F) Premium waiver provisions;

(G) Renewability;

(H) Ability to raise premiums;

(I) Marketing methods;

(J) Underwriting procedures;

(K) Claims adjustment procedures;

(L) Waiting periods;

(M) Maximum benefits;

(N) Availability of eligible facilities;

(O) Margins in claim costs;

(P) Optional nature of benefit;

(Q) Delay in eligibility for benefit;

(R) Inflation protection provisions; and

(S) Guaranteed insurability option.

(2) For purposes of section (1) of this rule, an applicable valuation morbidity table shall be certified as appropriate as a statutory valuation table by a qualified actuary.

(3) When long term care benefits are provided other than as in section (1) of this rule, reserves shall be determined in accordance with OAR 836-031-0200 to 836-031-0300.

Or. Admin. Code § 836-052-0656

ID 20-1990, f. 12-13-90, cert. ef. 1-1-91; ID 1-1996, f. & cert. ef. 1-12-96; Renumbered from 836-052-0545, ID 3-2005, f. & cert. ef. 3-1-05; ID 10-2007, f. 12-3-07, cert. ef. 1-1-08

Stat. Auth.: ORS 731.244, 742.023, 743.013, 743.655, 743.656 & 746.240

Stats. Implemented: ORS 742.003, 742.005, 743.650, 743.655 & 743.656