(1) For purposes of carrying out a multiple employer welfare arrangement, a trust shall maintain adequate reserves. Reserves must be held in cash or obligations guaranteed by the United States or invested in a registered investment company and invested exclusively in cash or obligations guaranteed by the United States. Reserves must be calculated with proper actuarial calculations of all of the following:

(a) Known claims, paid and outstanding.

(b) A history of incurred but not reported claims.

(c) Claims handling expenses.

(d) Unearned contributions.

(e) An estimate for bad debts.

(f) A trend factor.

(2) Each multiple employer welfare arrangement shall submit annually to the Director of the Department of Consumer and Business Services an opinion of a qualified actuary as provided in this subsection. The opinion shall determine the adequacy of reserves of the multiple employer welfare arrangement. The director by rule shall adopt requirements for the actuarial opinion and standards on which the opinion must be based. In adopting the standards, the director shall consider standards established by the National Association of Insurance Commissioners in its instructions for annual statements. The director by rule shall also define ‘qualified actuary’ for purposes of this subsection by establishing qualifications required of an actuary for the purpose of giving the opinion. In establishing the definition, the director shall consider standards established from time to time by the American Academy of Actuaries. [1993 c.615 § 9; 1995 c.166 § 1]

See note under 750.301.