58-26-94. Specifications required for adoption of valuation manual. The director may adopt the NAIC valuation manual of instruction if the valuation manual specifies the following:

(1) Minimum valuation standards for, and definitions of, the policies or contracts subject to § 58-26-45.1. The minimum valuation standards are:

(a) The commissioner's reserve valuation method for life insurance contracts, other than annuity contracts, subject to § 58-26-45.1;

(b) The commissioners annuity reserve valuation method for annuity contracts subject to § 58-26-45.1; and

(c) Minimum reserves for all other policies or contracts subject to § 58-26-45.1;

(2) Which policies or contracts or types of policies or contracts that are subject to the requirements of a principle-based valuation in § 58-26-98 and the minimum valuation standards consistent with those requirements;

(3) For policies and contracts subject to a principle-based valuation pursuant to §§ 58-26-98 to 58-26-100, inclusive:

(a) Requirements for the format of reports to the director pursuant to subdivision 58-26-99(3), and which shall include information necessary to determine if the valuation is appropriate and in compliance with this chapter;

(b) Assumptions are prescribed for risks over which the company does not have significant control or influence; and

(c) Procedures for corporate governance and oversight of the actuarial function, and a process for appropriate waiver or modification of such procedures;

(4) For policies not subject to a principle-based valuation pursuant to §§ 58-26-98 to 58-26-100, inclusive, the minimum valuation standard shall:

(a) Be consistent with the minimum standard of valuation prior to the operative date of the valuation manual; or

(b) Develop reserves that quantify the benefits and guarantees, and the funding, associated with the contracts and their risks at a level of conservatism that reflects conditions that include unfavorable events that have a reasonable probability of occurring;

(5) Other requirements, including those relating to reserve methods, models for measuring risk, generation of economic scenarios, assumptions, margins, use of company experience, risk measurement, disclosure, certifications, reports, actuarial opinions and memorandums, transition rules, and internal controls; and

(6) The data and form of the data required pursuant to § 58-26-101, with whom the data must be submitted, and may specify other requirements including data analyses and reporting of analyses.Source: SL 2015, ch 254, § 28.