Florida Regulations 69O-188.021: Definitions
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As used herein and for purposes of Forms OIR-EX and OIR-IA, the following definitions shall apply. For purposes of reporting on a calendar-accident year basis, references to “”policy year”” in the rules in this part shall mean “”calendar-accident year”” as the context may require.
(1) “”Office”” means the Office of Insurance Regulation.
(2) “”Policy Year”” means an aggregate record of all transactions for policies becoming effective during a given twelve (12) month period ending on December 31.
(3) “”Calendar-Accident Year”” means premiums earned during a twelve (12) month period ending December 31 and losses incurred from accidents which occur during the same period.
(4) “”Calendar-Year”” means the twelve (12) month period ending December 31 for which all policies of a particular policy year were effective. This definition is not applicable to funds reporting on a calendar-accident year basis.
(5) “”Earned Premium”” means:
(a) For a policy year, all earned premiums collected or due for each policy year including endorsement premiums, post-year audit adjustments, and retro rating plan adjustments less reinsurance expenses associated with such policies and less contributions to aggregate excess funds.
(b) For a calendar-accident year, all earned premiums collected or due for each calendar-accident year less reinsurance expenses associated with such premiums and less contributions to aggregate excess funds. Endorsement premiums, post-year audit adjustments, and retro rating plan adjustments shall be included in the calendar-accident year in which such adjustments are made.
(6) “”Collected Premium”” means:
(a) For a policy year, all premiums collected for each policy year including endorsement premiums, post-year audit adjustments, and retro rating plan adjustments less reinsurance expenses associated with such policies and less contributions to aggregate excess funds.
(b) For a calendar-accident year, all premiums collected or due for each calendar-accident year less reinsurance expenses associated with such premiums and less contributions to aggregate excess funds. Endorsement premiums, post-year audit adjustments, and retro rating plan adjustments shall be included in the calendar-accident year in which such adjustments are made.
(7) “”Investment Income”” means net investment gain or loss reported on the fund’s most recent annual statement filed with the Office prorated proportionately among all policy years excluding closed policy years as follows:
a x b/c
=
Investment Income for a specific policy year.
a
=
Net Investment gain or loss as reported on the fund’s most recent annual statement (page 4, column (1), line 9A. of the fund’s 1989 annual statement and equivalent item reported on prior and subsequent annual statements if page, column, or line number is different).
b
=
Current fund balance from line 3., Form OIR-IA, Schedule “”A,”” if positive, of the specific policy year to which investment income is to be allocated. If line 3., Form OIR-IA, Schedule “”A,”” is negative for a specific policy year, b equals zero.
c
=
Total of current positive fund balances of all policy years from line 3., Form OIR-IA, Schedule “”A.””
(8) “”Allocated Funds”” means the annual allocations of positive net fund balances, line 6., Form OIR-EX, among policy years. Funds allocated from a policy year cannot exceed the lesser of 25% of earned premium for that policy year or the net fund balance on Form OIR-EX, line 6., for that policy year. All allocations must be formally approved by the trustees of the fund.
(9) “”Other Income and Contributions”” means:
(a) Any miscellaneous income resulting from the operations of the fund during each calendar year; and,
(b) Any cash or equivalent voluntary contributions received from trustees, members, or others designated for a specific policy year.
(10) “”Losses and Allocated Loss Adjustment Expenses Paid”” means amounts paid for losses and allocated expenses necessary for the adjustment of such losses for each policy year less any amounts received or due from reinsurance, salvage, subrogation, and if applicable, from the second injury fund associated with such paid losses and loss adjustment expenses.
(11) “”Losses and Allocated Loss Adjustment Expense Reserves”” means the value of reserves prior to any discounting, calculated in accordance with sound actuarial principles, for losses and allocated expenses necessary for the adjustment of such losses for reported and unreported occurrences not yet paid for each policy year less any applicable reinsurance, salvage, subrogation, and second injury fund recoverable for such losses and loss adjustment expenses.
(12) “”Unallocated Loss Adjustment Expenses Paid”” means the amounts paid for such expenses that cannot be allocated to a particular claim and are necessary for the adjustment of losses for each policy year less any amounts received or due from any applicable reinsurance, salvage, subrogation and the second injury fund related to or associated with such paid unallocated loss adjustment expenses.
(13) “”Unallocated Loss Adjustment Expense Reserves”” means the value of reserves prior to any discounting, calculated in accordance with sound actuarial principles, for expenses that cannot be allocated to a particular claim and are necessary for the adjustment of losses for reported and unreported occurrences not yet paid for each policy year less any applicable reinsurance, salvage, subrogation and second injury fund recoverable for such unallocated adjustment reserves.
(14) “”Excess of Statutory Reserves Over Statement Reserves”” means the reserves calculated in accordance with the instructions shown on Schedule P of the annual statement. The total of such reserves for all years is shown on the balance sheet on page 3 of the annual statement.
(15) “”Present Value of Unallocated Loss Adjustment Expense Reserves,”” “”Present Value of Loss and Allocated Loss Adjustment Expense Reserves,”” or “”Present Value of Excess of Statutory Reserves over Statement Reserves”” means reserves discounted to present value using the most recent United States Internal Revenue Service present value factors. All present value calculations shall be done by annual statement line of business.
(16) “”Other Underwriting Expenses”” means the amount incurred during each calendar year for all expenses not reported elsewhere. Initial organizational costs incurred by the fund may be amortized by the straight line method over sixty (60) months.
(17) “”Dividends”” means dividends paid for a policy year.
(18) “”Trustees”” means the Board of Trustees of the fund.
(19) “”Aggregate Excess Funds”” means the aggregate amounts accumulated by the fund in lieu of or in addition to purchasing aggregate excess insurance coverage, and shall be expended only with Department approval.
(20) “”Closed Policy Year”” means a policy year in which all expenses for such policy year have been paid, there are no reserves for losses or loss adjustment expenses, there are no open or anticipated claims and there are no unpaid declared dividends.
Rulemaking Authority 624.308 FS. Law Implemented 624.307(1), 624.470, 624.474, 624.488 FS. History-New 12-17-90, Formerly 4-78.021, 4-188.021.
(1) “”Office”” means the Office of Insurance Regulation.
(2) “”Policy Year”” means an aggregate record of all transactions for policies becoming effective during a given twelve (12) month period ending on December 31.
(3) “”Calendar-Accident Year”” means premiums earned during a twelve (12) month period ending December 31 and losses incurred from accidents which occur during the same period.
(4) “”Calendar-Year”” means the twelve (12) month period ending December 31 for which all policies of a particular policy year were effective. This definition is not applicable to funds reporting on a calendar-accident year basis.
(5) “”Earned Premium”” means:
(a) For a policy year, all earned premiums collected or due for each policy year including endorsement premiums, post-year audit adjustments, and retro rating plan adjustments less reinsurance expenses associated with such policies and less contributions to aggregate excess funds.
(b) For a calendar-accident year, all earned premiums collected or due for each calendar-accident year less reinsurance expenses associated with such premiums and less contributions to aggregate excess funds. Endorsement premiums, post-year audit adjustments, and retro rating plan adjustments shall be included in the calendar-accident year in which such adjustments are made.
(6) “”Collected Premium”” means:
(a) For a policy year, all premiums collected for each policy year including endorsement premiums, post-year audit adjustments, and retro rating plan adjustments less reinsurance expenses associated with such policies and less contributions to aggregate excess funds.
(b) For a calendar-accident year, all premiums collected or due for each calendar-accident year less reinsurance expenses associated with such premiums and less contributions to aggregate excess funds. Endorsement premiums, post-year audit adjustments, and retro rating plan adjustments shall be included in the calendar-accident year in which such adjustments are made.
(7) “”Investment Income”” means net investment gain or loss reported on the fund’s most recent annual statement filed with the Office prorated proportionately among all policy years excluding closed policy years as follows:
a x b/c
=
Investment Income for a specific policy year.
a
=
Net Investment gain or loss as reported on the fund’s most recent annual statement (page 4, column (1), line 9A. of the fund’s 1989 annual statement and equivalent item reported on prior and subsequent annual statements if page, column, or line number is different).
b
=
Current fund balance from line 3., Form OIR-IA, Schedule “”A,”” if positive, of the specific policy year to which investment income is to be allocated. If line 3., Form OIR-IA, Schedule “”A,”” is negative for a specific policy year, b equals zero.
c
=
Total of current positive fund balances of all policy years from line 3., Form OIR-IA, Schedule “”A.””
(8) “”Allocated Funds”” means the annual allocations of positive net fund balances, line 6., Form OIR-EX, among policy years. Funds allocated from a policy year cannot exceed the lesser of 25% of earned premium for that policy year or the net fund balance on Form OIR-EX, line 6., for that policy year. All allocations must be formally approved by the trustees of the fund.
(9) “”Other Income and Contributions”” means:
(a) Any miscellaneous income resulting from the operations of the fund during each calendar year; and,
(b) Any cash or equivalent voluntary contributions received from trustees, members, or others designated for a specific policy year.
(10) “”Losses and Allocated Loss Adjustment Expenses Paid”” means amounts paid for losses and allocated expenses necessary for the adjustment of such losses for each policy year less any amounts received or due from reinsurance, salvage, subrogation, and if applicable, from the second injury fund associated with such paid losses and loss adjustment expenses.
(11) “”Losses and Allocated Loss Adjustment Expense Reserves”” means the value of reserves prior to any discounting, calculated in accordance with sound actuarial principles, for losses and allocated expenses necessary for the adjustment of such losses for reported and unreported occurrences not yet paid for each policy year less any applicable reinsurance, salvage, subrogation, and second injury fund recoverable for such losses and loss adjustment expenses.
(12) “”Unallocated Loss Adjustment Expenses Paid”” means the amounts paid for such expenses that cannot be allocated to a particular claim and are necessary for the adjustment of losses for each policy year less any amounts received or due from any applicable reinsurance, salvage, subrogation and the second injury fund related to or associated with such paid unallocated loss adjustment expenses.
(13) “”Unallocated Loss Adjustment Expense Reserves”” means the value of reserves prior to any discounting, calculated in accordance with sound actuarial principles, for expenses that cannot be allocated to a particular claim and are necessary for the adjustment of losses for reported and unreported occurrences not yet paid for each policy year less any applicable reinsurance, salvage, subrogation and second injury fund recoverable for such unallocated adjustment reserves.
(14) “”Excess of Statutory Reserves Over Statement Reserves”” means the reserves calculated in accordance with the instructions shown on Schedule P of the annual statement. The total of such reserves for all years is shown on the balance sheet on page 3 of the annual statement.
(15) “”Present Value of Unallocated Loss Adjustment Expense Reserves,”” “”Present Value of Loss and Allocated Loss Adjustment Expense Reserves,”” or “”Present Value of Excess of Statutory Reserves over Statement Reserves”” means reserves discounted to present value using the most recent United States Internal Revenue Service present value factors. All present value calculations shall be done by annual statement line of business.
(16) “”Other Underwriting Expenses”” means the amount incurred during each calendar year for all expenses not reported elsewhere. Initial organizational costs incurred by the fund may be amortized by the straight line method over sixty (60) months.
(17) “”Dividends”” means dividends paid for a policy year.
(18) “”Trustees”” means the Board of Trustees of the fund.
(19) “”Aggregate Excess Funds”” means the aggregate amounts accumulated by the fund in lieu of or in addition to purchasing aggregate excess insurance coverage, and shall be expended only with Department approval.
(20) “”Closed Policy Year”” means a policy year in which all expenses for such policy year have been paid, there are no reserves for losses or loss adjustment expenses, there are no open or anticipated claims and there are no unpaid declared dividends.
Rulemaking Authority 624.308 FS. Law Implemented 624.307(1), 624.470, 624.474, 624.488 FS. History-New 12-17-90, Formerly 4-78.021, 4-188.021.