As used in this rule chapter, the following terms have the following meaning:

1. (1) Annual Claim Cost. The net annual cost per unit of benefit before the addition of expenses, including claim settlement expenses, and a margin for profit or contingencies. For example, the annual claim cost for a $100 monthly disability benefit, for a maximum disability benefit period of one year, with an elimination period of one week, with respect to a male at age 35, in a certain occupation might be $12, while the gross premium for this benefit might be $18. The additional $6 would cover expenses and profit or contingencies.
2. (2) Claims Accrued. That portion of claims incurred on or prior to the valuation date which result in liability of the insurer for the payment of benefits for medical services which have been rendered on or prior to the valuation date, and for the payment of benefits for days of hospitalization and days of disability which have occurred on or prior to the valuation date, which the insurer has not paid as of the valuation date, but for which it is liable, and will have to pay after the valuation date. This liability is sometimes referred to as a liability for accrued benefits.
3. (3) Claims Reported. For annual statement purposes, a reported claim is a claim that has been incurred on or before the valuation date and has been reported on or before the valuation date.
4. (4) Claims Unaccrued. That portion of claims incurred on or prior to the valuation date which result in liability of the insurer for the payment of benefits for medical services expected to be rendered after the valuation date, and for benefits expected to be payable for days of hospitalization and days of disability occurring after the valuation date. This liability is sometimes referred to as a liability for unaccrued benefits.
5. (5) Claims Unreported. For annual statement purposes, an unreported claim is a claim that has been incurred on or before the valuation date but has not been reported on or before the valuation date.
6. (6) Date of Disablement. The earliest date the insured is considered disabled under the definition of disability in the contract, based on a doctor’s evaluation or other evidence. Normally this date will coincide with the start of any elimination period.
7. (7) Elimination Period. A specified number of days, weeks, or months starting at the beginning of each period of loss during which no benefits are payable.
8. (8) Gross Premium. The amount of premium charged by the insurer. It includes the net premium (based on claim-cost) for the risk, together with any loading for expenses, profit, or contingencies.
9. (9) Group Insurance. The term group insurance includes blanket insurance, franchise insurance, and any other forms of group insurance.
10. (10) Group Long-Term Disability Income. The term group long-term disability income includes group contracts providing group disability income coverage with a maximum benefit duration longer than two years. Group long-term disability income contracts are based on a group pricing structure. The term “group long-term disability” does not include group short-term disability (coverage with benefit periods of two years or less in maximum duration). It also does not include voluntary group disability income coverage that is priced on an individual risk structure and generally sold in the workplace.

11. (11) Level Premium. A premium calculated to remain unchanged throughout either the lifetime of the policy or for some shorter projected period of years. The premium need not be guaranteed, in which case, although it is calculated to remain level, it shall be changed if any of the assumptions on which it was based are revised at a later time.

    Generally, the annual claim costs are expected to increase each year and the insurer, instead of charging premiums that correspondingly increase each year, charges a premium calculated to remain level for a period of years or for the lifetime of the contract. In this case the benefit portion of the premium is more than needed to provide for the cost of benefits during the earlier years of the policy and less than the actual cost in the later years. The building of a prospective contract reserve is a natural result of level premiums.

12. (12) Long-Term Care Insurance. Insurance as defined in section 627.9404, F.S.
13. (13) Medicare Supplement Insurance. Insurance as defined in section 627.672, F.S.
14. (14) Modal Premium. Refers to the premium paid on a contract based on a premium term which could be annual, semi-annual, quarterly, monthly, or weekly. Thus if the annual premium is $100, and instead monthly premiums of $9 are paid, then the modal premium is $9.
15. (15) Negative Reserve. Normally the terminal reserve is a positive value. However, if the values of the benefits are decreasing with advancing age or duration it could be a negative value, called a negative reserve.
16. (16) Preliminary Term Reserve Method. Under this method of valuation the valuation net premium for each year falling within the preliminary term period is exactly sufficient to cover the expected incurred claims of that year, so the terminal reserves shall be zero at the end of the year. As of the end of the preliminary term period, a new constant valuation net premium (or stream of changing valuation premiums) becomes applicable so the present value of all such premiums is equal to the present value of all claims expected to be incurred following the end of the preliminary term period.
17. (17) Present Value of Amounts Not Yet Due on Claims. The reserve for claims unaccrued which may at the option of the insurer be discounted at interest.

18. (18) Reserve. Includes all items of benefit liability, whether in the nature of incurred claim liability or of contract liability relating to future periods of coverage, and whether the liability is accrued or unaccrued. An insurer under its contracts promises benefits which result in:

    1. (a) Claims which have been incurred; that is, for which the insurer has become obligated to make payment, on or prior to the valuation date. On these claims, payments expected to be made after the valuation date for accrued and unaccrued benefits are liabilities of the insurer which shall be provided for by establishing claim reserves; or
    2. (b) Claims which are expected to be incurred after the valuation date. Any present liability of the insurer for these future claims shall be provided for by the establishment of contract reserves and unearned premium reserves.
19. (19) Terminal Reserve. The reserve at the end of a contract year, defined as the present value of benefits expected to be incurred after that contract year, minus the present value of future valuation net premiums.

20. (20) Unearned Premium Reserve.

    1. (a) This reserve values that portion of the premium paid or due to the insurer which is applicable to the period of coverage extending beyond the valuation date. Thus if an annual premium of $120 was paid on November 1, $20 would be earned as of December 31 and the remaining $100 would be unearned. The unearned premium reserve shall be on a gross basis as in this example, or on a valuation net premium basis. The reserve for a policy which provides for the return of unearned premium in the event of termination shall be on a gross basis.
    2. (b) Single premium credit disability insurance, both individual and group, is excluded from this definition of unearned premium reserve.
21. (21) Valuation Net Modal Premium. The modal fraction of the valuation net annual premium that corresponds to the gross modal premium in effect on any contract to which contract reserves apply. Thus if the mode of payment in effect is quarterly, the valuation net modal premium is the quarterly equivalent of the valuation net annual premium.
22. (22) Credible Experience. For experience to be considered credible for purposes of sub-sub-subparagraph 69O-154.203(1)(b)1.b.(I), F.A.C., the company shall be able to provide claim termination patterns over no more than six (6) years reflecting at least 5,000 claims terminations during the third through fifth claims durations on reasonably similar applicable policy forms.
23. (23) Best Estimate Assumptions. Assumptions designed to produce results which on average will prove to have been too high half of the time and too low half of the time. Alternatively, assumptions which have the greatest likelihood of being correct.
24. (24) Sound Values. To place a sound value on a claim liability means to estimate the amount of future payments in such a way as to reduce the likelihood that the estimate will be less than the amounts ultimately paid. Placing a sound value requires that as uncertainty of the amounts ultimately paid increases, the amount by which the estimated claim liability exceeds the estimated future amount of payments also increases. When past experience exists, it can be used, subject to emerging trends in recovery rates, inflation, and other factors which can be used to make reasonable estimates. In the absence of prior experience, the actuary shall rely on commonly accepted estimations such as fixed number of months of premium or paid claims, or an amount such that the paid claims plus change in the liability equal a percentage of premium. (Unless past experience is not credible the preceding method can be used only in the first two years after a benefit without prior experience has been sold.)
25. (25) Reasonable Margins. Adjustments (to most likely assumptions) necessary to produce contract or claim reserves which reflect sound values. The use of margins results in reserves which exceed an estimate of most likely future benefit payments. The margin for adverse experience is equal to this excess.
26. (26) Adequate Reserves. Reserves calculated based on best estimate assumptions adjusted to include reasonable margins. For purposes of this rule, reserves must equal or exceed reserves determined using the minimum standards provided herein.
27. (27) Adequate Provision for Accrued and Unaccrued Benefits. Amounts deemed necessary to comply with the requirements of Section 625.041, F.S.

28. (28) Commonly Accepted Actuarial Practice.

    1. (a) Practices consistent with standards of practice established by the Actuarial Standards Board.

    2. (b) The following standards of practice are hereby adopted and incorporated by reference:

       1. Actuarial Standard of Practice No. 1 Introductory Actuarial Standard of Practice, effective 03/13, available at HYPERLINK "http://www.flrules.org/Gateway/reference.asp?No=Ref-10519" http://www.flrules.org/Gateway/reference.asp?No=Ref-10519;

       2. Actuarial Standard of Practice No. 2 Nonguaranteed Charges or Benefits for Life Insurance Policies and Annuity Contracts, effective 05/11 available at HYPERLINK "http://www.flrules.org/Gateway/reference.asp?No=Ref-10520" http://www.flrules.org/Gateway/reference.asp?No=Ref-10520;

       3. Actuarial Standard of Practice No. 3 Continuing Care Retirement Communities, effective 01/11, available at HYPERLINK "http://www.flrules.org/Gateway/reference.asp?No=Ref-10521" http://www.flrules.org/Gateway/reference.asp?No=Ref-10521;

       4. Actuarial Standard of Practice No. 4 Measuring Pension Obligations and Determining Pension Plan Costs or Contributions, effective 12/13, available at HYPERLINK "http://www.flrules.org/Gateway/reference.asp?No=Ref-10522" http://www.flrules.org/Gateway/reference.asp?No=Ref-10522;

       5. Actuarial Standard of Practice No. 5 Incurred Health and Disability Claims, effective 03/17, available at HYPERLINK "http://www.flrules.org/Gateway/reference.asp?No=Ref-10523" http://www.flrules.org/Gateway/reference.asp?No=Ref-10523;

       6. Actuarial Standard of Practice No. 6 Measuring Retiree Group Benefits Obligations and Determining Retiree Group Benefits Program Periodic Costs or Actuarially Determined Contributions, effective 05/14, available at HYPERLINK "http://www.flrules.org/Gateway/reference.asp?No=Ref-10525" http://www.flrules.org/Gateway/reference.asp?No=Ref-10525;

       7. Actuarial Standard of Practice No. 7 Analysis of Life, Health, or Property/Casualty Insurer Cash Flows, effective 05/11, available at HYPERLINK "http://www.flrules.org/Gateway/reference.asp?No=Ref-10526" http://www.flrules.org/Gateway/reference.asp?No=Ref-10526;

       8. Actuarial Standard of Practice No. 8 Regulatory Filings for Health Benefits, Accident and Health Insurance, and Entities Providing Health Benefits, effective 03/14, available at HYPERLINK "http://www.flrules.org/Gateway/reference.asp?No=Ref-10547" http://www.flrules.org/Gateway/reference.asp?No=Ref-10547;

       9. Actuarial Standard of Practice No. 9 Documentation and Disclosure in Property and Casualty Insurance Ratemaking, Loss Reserving, and Valuations, effective 03/13, available at HYPERLINK "http://www.flrules.org/Gateway/reference.asp?No=Ref-10528" http://www.flrules.org/Gateway/reference.asp?No=Ref-10528;

       10. Actuarial Standard of Practice No. 10 Methods and Assumptions for Use in Life Insurance Company Financial Statements Prepared in Accordance with U.S. GAAP, effective 01/11, available at HYPERLINK "http://www.flrules.org/Gateway/reference.asp?No=Ref-10529" http://www.flrules.org/Gateway/reference.asp?No=Ref-10529;

       11. Actuarial Standard of Practice No. 11 Financial Statement Treatment of Reinsurance Transactions Involving Life or Health Insurance, effective 01/11, available at HYPERLINK "http://www.flrules.org/Gateway/reference.asp?No=Ref-10530" http://www.flrules.org/Gateway/reference.asp?No=Ref-10530;

       12. Actuarial Standard of Practice No. 12 Risk Classification (for All Practice Areas), effective 01/11, available at HYPERLINK "http://www.flrules.org/Gateway/reference.asp?No=Ref-10531" http://www.flrules.org/Gateway/reference.asp?No=Ref-10531;

       13. Actuarial Standard of Practice No. 13 Trending Procedures in Property/Casualty Insurance, effective 05/11, available at HYPERLINK "http://www.flrules.org/Gateway/reference.asp?No=Ref-10532" http://www.flrules.org/Gateway/reference.asp?No=Ref-10532;

       14. Actuarial Standard of Practice No. 14 When to Do Cash Flow Testing for Life and Health Insurance Companies, effective 03/13, available at HYPERLINK "http://www.flrules.org/Gateway/reference.asp?No=Ref-10533" http://www.flrules.org/Gateway/reference.asp?No=Ref-10533;

       15. Actuarial Standard of Practice No. 15 Dividends for Individual Participating Life Insurance, Annuities, and Disability Insurance, effective 05/11, available at HYPERLINK "http://www.flrules.org/Gateway/reference.asp?No=Ref-10534" http://www.flrules.org/Gateway/reference.asp?No=Ref-10534;

       16. Actuarial Standard of Practice No. 16 Actuarial Practice Concerning Health Maintenance Organizations and Other Managed-Care Health Plans, effective 04/07, available at HYPERLINK "http://www.flrules.org/Gateway/reference.asp?No=Ref-10535" http://www.flrules.org/Gateway/reference.asp?No=Ref-10535;

       17. Actuarial Standard of Practice No. 17 Expert Testimony by Actuaries, effective 06/18, available at HYPERLINK "http://www.flrules.org/Gateway/reference.asp?No=Ref-10538" http://www.flrules.org/Gateway/reference.asp?No=Ref-10538;

       18. Actuarial Standard of Practice No. 18 Long-Term Care Insurance, effective 05/11, available at HYPERLINK "http://www.flrules.org/Gateway/reference.asp?No=Ref-10539" http://www.flrules.org/Gateway/reference.asp?No=Ref-10539;

       19. Actuarial Standard of Practice No. 19 Appraisals of Casualty, Health, and Life Insurance Businesses, effective 05/11, available at HYPERLINK "http://www.flrules.org/Gateway/reference.asp?No=Ref-10540" http://www.flrules.org/Gateway/reference.asp?No=Ref-10540;

       20. Actuarial Standard of Practice No. 20 Discounting of Property/Casualty Unpaid Claim Estimates, effective 09/11, available at HYPERLINK "http://www.flrules.org/Gateway/reference.asp?No=Ref-10541" http://www.flrules.org/Gateway/reference.asp?No=Ref-10541;

       21. Actuarial Standard of Practice No. 21 Responding to or Assisting Auditors or Examiners in Connection with Financial Audits, Financial Reviews, and Financial Examination, effective 09/16, available at HYPERLINK "http://www.flrules.org/Gateway/reference.asp?No=Ref-10542" http://www.flrules.org/Gateway/reference.asp?No=Ref-10542;

       22. Actuarial Standard of Practice No. 22 Statement of Opinion Based on Asset Adequacy Analysis by Actuaries for Life or Health Insurers, effective 12/12, available at HYPERLINK "http://www.flrules.org/Gateway/reference.asp?No=Ref-10543" http://www.flrules.org/Gateway/reference.asp?No=Ref-10543;

       23. Actuarial Standard of Practice No. 23 Data Quality, effective 12/16, available at HYPERLINK "http://www.flrules.org/Gateway/reference.asp?No=Ref-10544" http://www.flrules.org/Gateway/reference.asp?No=Ref-10544;

       24. Actuarial Standard of Practice No. 24 Compliance with the NAIC Life Insurance Illustrations Model Regulation, effective 12/16, available at HYPERLINK "http://www.flrules.org/Gateway/reference.asp?No=Ref-10545" http://www.flrules.org/Gateway/reference.asp?No=Ref-10545;

       25. Actuarial Standard of Practice No. 25 Credibility Procedures, effective 12/13, available at HYPERLINK "http://www.flrules.org/Gateway/reference.asp?No=Ref-10546" http://www.flrules.org/Gateway/reference.asp?No=Ref-10546;

       26. Actuarial Standard of Practice No. 26 Compliance with Statutory and Regulatory Requirements for the Actuarial Certification of Small Employer Health Benefit Plans, effective 05/11, available at HYPERLINK "http://www.flrules.org/Gateway/reference.asp?No=Ref-10548" http://www.flrules.org/Gateway/reference.asp?No=Ref-10548;

       27. Actuarial Standard of Practice No. 27 Selection of Economic Assumptions for Measuring Pension Obligations, effective 09/13, available at HYPERLINK "http://www.flrules.org/Gateway/reference.asp?No=Ref-10554" http://www.flrules.org/Gateway/reference.asp?No=Ref-10554;

       28. Actuarial Standard of Practice No. 28 Statements of Actuarial Opinion Regarding Health Insurance Liabilities and Assets, effective 12/12, available at HYPERLINK "http://www.flrules.org/Gateway/reference.asp?No=Ref-10550" http://www.flrules.org/Gateway/reference.asp?No=Ref-10550;

       29. Actuarial Standard of Practice No. 29 Expense Provisions in Property/Casualty Insurance Ratemaking, effective 05/11, available at HYPERLINK "http://www.flrules.org/Gateway/reference.asp?No=Ref-10551" http://www.flrules.org/Gateway/reference.asp?No=Ref-10551;

       30. Actuarial Standard of Practice No. 30 Treatment of Profit and Contingency Provisions and the Cost of Capital in Property/Casualty Insurance Ratemaking, effective 05/11, available at HYPERLINK "http://www.flrules.org/Gateway/reference.asp?No=Ref-10552" http://www.flrules.org/Gateway/reference.asp?No=Ref-10552;

       31. Actuarial Standard of Practice No. 31 Documentation in Health Benefit Plan Ratemaking, effective 06/09, available at HYPERLINK "http://www.flrules.org/Gateway/reference.asp?No=Ref-10553" http://www.flrules.org/Gateway/reference.asp?No=Ref-10553;

       32. Actuarial Standard of Practice No. 32 Social Insurance, effective 05/11, available at HYPERLINK "http://www.flrules.org/Gateway/reference.asp?No=Ref-10555" http://www.flrules.org/Gateway/reference.asp?No=Ref-10555;

       33. Actuarial Standard of Practice No. 33 Actuarial Responsibilities with Respect to Closed Blocks in Mutual Life Insurance Company Conversions, effective 05/11, available at HYPERLINK "http://www.flrules.org/Gateway/reference.asp?No=Ref-10556" http://www.flrules.org/Gateway/reference.asp?No=Ref-10556;

       34. Actuarial Standard of Practice No. 34 Actuarial Practice Concerning Retirement Plan Benefits in Domestic Relations Actions, effective 06/15, available at HYPERLINK "http://www.flrules.org/Gateway/reference.asp?No=Ref-10557" http://www.flrules.org/Gateway/reference.asp?No=Ref-10557;

       35. Actuarial Standard of Practice No. 35 Selection of Demographic and Other Noneconomic Assumptions for Measuring Pension Obligations, effective 09/14, available at HYPERLINK "http://www.flrules.org/Gateway/reference.asp?No=Ref-10558" http://www.flrules.org/Gateway/reference.asp?No=Ref-10558;

       36. Actuarial Standard of Practice No. 36 Statements of Actuarial Opinion Regarding Property/Casualty Loss and Loss Adjustment Expense Reserves, effective 05/11, available at HYPERLINK "http://www.flrules.org/Gateway/reference.asp?No=Ref-10559" http://www.flrules.org/Gateway/reference.asp?No=Ref-10559;

       37. Actuarial Standard of Practice No. 37 Allocation of Policyholder Consideration in Mutual Life Insurance Company Demutualizations, effective 05/11, available at HYPERLINK "http://www.flrules.org/Gateway/reference.asp?No=Ref-10560" http://www.flrules.org/Gateway/reference.asp?No=Ref-10560;

       38. Actuarial Standard of Practice No. 38 Using Models Outside the Actuary’s Area of Expertise (Property and Casualty), effective 05/11, available at HYPERLINK "http://www.flrules.org/Gateway/reference.asp?No=Ref-10561" http://www.flrules.org/Gateway/reference.asp?No=Ref-10561;

       39. Actuarial Standard of Practice No. 39 Treatment of Catastrophe Losses in Property/Casualty Insurance Ratemaking, effective 03/13, available at HYPERLINK "http://www.flrules.org/Gateway/reference.asp?No=Ref-10562" http://www.flrules.org/Gateway/reference.asp?No=Ref-10562;

       40. Actuarial Standard of Practice No. 40 Compliance with the NAIC Valuation of Life Insurance Policies Model Regulation with Respect to Deficiency Reserve Mortality, effective 05/11, available at HYPERLINK "http://www.flrules.org/Gateway/reference.asp?No=Ref-10563" http://www.flrules.org/Gateway/reference.asp?No=Ref-10563;

       41. Actuarial Standard of Practice No. 41 Actuarial Standard of Practice, effective 12/10, available at HYPERLINK "http://www.flrules.org/Gateway/reference.asp?No=Ref-10564" http://www.flrules.org/Gateway/reference.asp?No=Ref-10564;

       42. Actuarial Standard of Practice No. 42 Health and Disability Actuarial Assets and Liabilities Other Than Liabilities for Incurred Claims, effective 03/18, available at HYPERLINK "http://www.flrules.org/Gateway/reference.asp?No=Ref-10565" http://www.flrules.org/Gateway/reference.asp?No=Ref-10565;

       43. Actuarial Standard of Practice No. 43 Property/Casualty Unpaid Claim Estimates, effective 05/11, available at HYPERLINK "http://www.flrules.org/Gateway/reference.asp?No=Ref-10566" http://www.flrules.org/Gateway/reference.asp?No=Ref-10566;

       44. Actuarial Standard of Practice No. 44 Selection of Asset Valuation Methods for Pension Valuations, effective 05/11, available at HYPERLINK "http://www.flrules.org/Gateway/reference.asp?No=Ref-10567" http://www.flrules.org/Gateway/reference.asp?No=Ref-10567;

       45. Actuarial Standard of Practice No. 45 The Use of Health Status Based Risk Adjustment Methodologies, effective 01/12, available at HYPERLINK "http://www.flrules.org/Gateway/reference.asp?No=Ref-10568" http://www.flrules.org/Gateway/reference.asp?No=Ref-10568;

       46. Actuarial Standard of Practice No. 46 Risk Evaluation in Enterprise Risk Management, effective 09/12, available at HYPERLINK "http://www.flrules.org/Gateway/reference.asp?No=Ref-10569" http://www.flrules.org/Gateway/reference.asp?No=Ref-10569;

       47. Actuarial Standard of Practice No. 47 Risk Treatment in Enterprise Risk Management, effective 12/12, available at HYPERLINK "http://www.flrules.org/Gateway/reference.asp?No=Ref-10570" http://www.flrules.org/Gateway/reference.asp?No=Ref-10570;

       48. Actuarial Standard of Practice No. 48 Life Settlements Mortality, effective 12/13, available at HYPERLINK "http://www.flrules.org/Gateway/reference.asp?No=Ref-10571" http://www.flrules.org/Gateway/reference.asp?No=Ref-10571;

       49. Actuarial Standard of Practice No. 49 Medicaid Managed Care Citation Rate Development and Certification, effective 03/15, available at HYPERLINK "http://www.flrules.org/Gateway/reference.asp?No=Ref-10582" http://www.flrules.org/Gateway/reference.asp?No=Ref-10582;

       50. Actuarial Standard of Practice No. 50 Determining Minimum Value and Actuarial Value under the Affordable Care Act, effective 09/15, available at HYPERLINK "http://www.flrules.org/Gateway/reference.asp?No=Ref-10583" http://www.flrules.org/Gateway/reference.asp?No=Ref-10583;

       51. Actuarial Standard of Practice No. 51 Assessment and Disclosure of Risk Associated with Measuring Pension Obligations and Determining Pension Plan Contributions, effective 09/17, available at HYPERLINK "http://www.flrules.org/Gateway/reference.asp?No=Ref-10574" http://www.flrules.org/Gateway/reference.asp?No=Ref-10574;

       52. Actuarial Standard of Practice No. 52 Principle-Based Reserves for Life Products under the NAIC Valuation Manual, effective 09/17, available at HYPERLINK "http://www.flrules.org/Gateway/reference.asp?No=Ref-10575" http://www.flrules.org/Gateway/reference.asp?No=Ref-10575;

       53. Actuarial Standard of Practice No. 53 Estimating Future Costs for Prospective Property/Casualty Risk Transfer and Risk Retention, effective 12/17, available at HYPERLINK "http://www.flrules.org/Gateway/reference.asp?No=Ref-10576" http://www.flrules.org/Gateway/reference.asp?No=Ref-10576; and

       54. Actuarial Standard of Practice No. 54 Pricing of Life Insurance and Annuity Products, effective 06/18, available at HYPERLINK "http://www.flrules.org/Gateway/reference.asp?No=Ref-10577" http://www.flrules.org/Gateway/reference.asp?No=Ref-10577.

    3. (c) A copy of the standards of practice may be obtained from the Actuarial Standards Board at http://www.actuarialstandardsboard.org/standards-of-practice/.
29. (29) Gross Premium Valuation. A projection of the present values of gross premiums, benefit payments (including dividends or experience refunds), expenses, and taxes, whose uses include testing reserve adequacy. Gross premium valuations use persistency and other assumptions considered most likely to occur. If significant doubt as to reserve adequacy remains after most likely assumptions are used, the gross premium valuation shall include additional sensitivity testing. Sensitivity testing involves adjusting some or all of the assumptions used in the gross premium valuation to measure the effects of adverse experience.
30. (30) Qualified Actuary. This is defined in Rule 69O-138.043, F.A.C.
31. (31) Reasonable Method. One which can be shown to produce claim reserves which reflect sound values.
32. (32) Reasonable Assumptions for Contract Reserves. A reasonable assumption is one which can be shown to produce adequate contract reserve.
33. (33) Rating Block. A grouping of contracts determined by the valuation actuary based on common characteristics, such as a policy form or forms having similar benefit designs.

Rulemaking Authority 624.308(1), 625.121(14), 625.081 FS. Law Implemented 624.307(1), 625.081, 625.121 FS. History–New 4-14-99, Formerly 4-154.202, Amended 3-1-04, 1-25-16, 8-15-19.