38.2-4610.2 - Loss reserves.
§ 38.2-4610.2. Loss reserves.
A. Each title insurance company licensed in this Commonwealth shall annuallyevaluate the adequacy of its total recorded loss reserves. Total recordedloss reserves are the sum of claim reserves held under § 38.2-4609 andunearned premium reserves held under § 38.2-4610.1. The evaluation of reserveadequacy shall be prepared by a qualified actuary and shall be based on acomparison of total recorded reserves to a projection of ultimate losses notyet paid. The actuary shall certify the results of his evaluation in a reportcomplying with such applicable title insurance annual statement instructionsas may be issued by the National Association of Insurance Commissioners.
B. A domestic title insurance company shall record an additional reserve tothe extent the projection of ultimate losses not yet paid set forth in thereport of the qualified actuary exceeds total recorded loss reserves held bythe company. For purposes of calculating any additional reserve required, adomestic title insurance company may discount the projection of ultimatelosses not yet paid to reflect the time value of money. The interest rateused by the actuary to reflect the time value of money shall be based on aportfolio interest rate approach with appropriate provision for risk marginsand subject to published actuarial standards for discounting reserves.
C. A foreign or alien title insurance company licensed in this Commonwealthshall record an additional reserve to the extent the projection of ultimatelosses set forth in the report of the qualified actuary exceeds all recordedreserves held by the company as reported in its most recent statutorystatement filed with the Commission, including reserves held under subsectionC of § 38.2-4610.1 and all reserves held under the laws of the jurisdictionof the domicile of the foreign or alien title insurance company or any otherjurisdiction.
(1996, c. 494.)