PARRIS N. GLENDENING, Governor

Ch. 36

"Life insurer" § 1-101
"Person" § 1-101
"Policy" § 1-101
"State" § 1-101

5-202. INADEQUATE RESERVES OF INSURER.

(A)     UNEARNED PREMIUM RESERVE.

IF THE COMMISSIONER DETERMINES THAT AN INSURER'S UNEARNED
PREMIUM RESERVE IS INADEQUATE, THE COMMISSIONER MAY REQUIRE THE
INSURER TO COMPUTE ALL OR PART OF THE RESERVE BY ANOTHER METHOD THAT
IS REQUIRED UNDER THIS SUBTITLE.

(B)     LOSS RESERVES.

IF THE COMMISSIONER DETERMINES THAT AN INSURER'S LOSS RESERVES ARE
INADEQUATE AS SHOWN BY THE INSURER'S LOSS EXPERIENCE, THE COMMISSIONER
SHALL REQUIRE THE INSURER TO INCREASE THE RESERVES AND MAINTAIN THEM
AT AN ADEQUATE LEVEL.

REVISOR'S NOTE: This section is new language derived without substantive
change from former Art. 48A, § 82.

In subsection (a) of this section, the phrase "however computed", which
formerly modified "unearned premium reserve", is deleted as surplusage.

In subsection (b) of this section, the phrase "[i]f the Commissioner
determines" is new language added to state expressly that which only was
implied in the former law - i.e., the Commissioner determines whether the
loss experience of an insurer shows that loss reserves are inadequate.

Also in subsection (b) of this section, the phrase "however estimated", which
formerly modified "loss reserves", is deleted as surplusage.

Defined terms: "Commissioner" § 1-101
"Insurer" § 1-101
"Premium" § 1-101

5-203. ACTIVE LIFE RESERVES FOR HEALTH INSURANCE.

(A)     REQUIRED.

AN INSURER SHALL MAINTAIN ACTIVE LIFE RESERVES FOR ALL HEALTH
INSURANCE POLICIES.

(B)      CRITERIA.

THE ACTIVE LIFE RESERVES:

(1) SHALL PLACE A SOUND VALUE ON THE INSURER'S LIABILITIES
UNDER THE HEALTH INSURANCE POLICIES;

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