Title 5. Assets, Liabilities, Reserves, and Investments of Insurers — Subtitle 3. Standard Valuation Law
Statutes in effect as of October 1, 2026.
Md. Code Ann., Ins. § 5-301 (2026)
Title 5. Assets, Liabilities, Reserves, and Investments of Insurers
Subtitle 3. Standard Valuation Law
§ 5–301LinkCopy Citation
(a)
In this subtitle the following words have the meanings indicated.
(b)
“Accident and health insurance contract” has the meaning stated in § 5–201.1(a) of this title.
(c)
“Appointed actuary” means a qualified actuary who is appointed in accordance with the valuation manual to prepare an opinion required by § 5–201.1 of this title.
(d)
“Company” has the meaning stated in § 5–201.1(a) of this title.
(e)
“Deposit–type contract” has the meaning stated in § 5–201.1(a) of this title.
(f)
“Life insurance policy” has the meaning stated in § 5–201.1(a) of this title.
(g)
“NAIC” means the National Association of Insurance Commissioners.
(h)
“Operative date of the valuation manual” has the meaning stated in § 5–201.1(a) of this title.
(i)
(1)
“Policyholder behavior” means any action a policyholder, contract holder, or any other person with the right to elect options, including a certificate holder, may take under a life insurance policy, an accident and health insurance contract, or a deposit–type contract issued on or after the operative date of the valuation manual.
(2)
“Policyholder behavior” includes behavior relating to lapse, withdrawal, transfer, deposit, premium payment, loan, annuitization, or benefit elections prescribed by a life insurance policy, an accident and health insurance contract, or a deposit–type contract issued on or after the operative date of the valuation manual.
(3)
“Policyholder behavior” does not include an event of mortality or morbidity that results in benefits prescribed in their essential aspects by the terms of a life insurance policy, an accident and health insurance contract, or a deposit–type contract issued on or after the operative date of the valuation manual.
(j)
“Principle–based valuation” means a reserve valuation that:
(1)
uses one or more methods or one or more assumptions determined by a company; and
(2)
meets the requirements of § 5–314 of this subtitle.
(k)
“Qualified actuary” has the meaning stated in § 5–201.1(a) of this title.
(l)
“Tail risk” means a risk that occurs when:
(1)
the frequency of low probability events is higher than expected under a normal probability distribution; or
(2)
events of very significant size or magnitude are observed.
(m)
“Valuation manual” has the meaning stated in § 5–201.1(a) of this title.
Md. Code Ann., Ins. § 5-301.1 (2026)
Title 5. Assets, Liabilities, Reserves, and Investments of Insurers
Subtitle 3. Standard Valuation Law
§ 5–301.1LinkCopy Citation
(a)
(1)
(i)
Subject to subparagraph (ii) of this paragraph, the Commissioner annually shall value or cause to be valued the reserves for all outstanding life insurance policies, annuity contracts, and pure endowment contracts issued by each life insurer doing business in the State before the operative date of the valuation manual.
(ii)
For an alien insurer, the valuation required by this subsection shall be limited to the alien insurer’s United States business.
(2)
To calculate reserves under this subsection, the Commissioner may use group methods and approximate averages for fractions of a year or otherwise.
(3)
For a foreign insurer or alien insurer, instead of the valuation of reserves required by paragraph (1) of this subsection, the Commissioner may accept a valuation made or caused to be made by the insurance supervisory official of another state or other jurisdiction if the valuation complies with the minimum standard under this subtitle.
(4)
Subject to the approval of the Commissioner, an insurer that has adopted a standard of valuation producing greater aggregate reserves than the aggregate reserves calculated under the minimum standard provided in this subtitle may adopt a lower standard of valuation if it is not lower than the minimum standard provided in this subtitle.
(b)
(1)
The Commissioner annually shall value or cause to be valued the reserves for all outstanding life insurance policies, accident and health insurance contracts, and deposit–type contracts issued by a company on or after the operative date of the valuation manual.
(2)
For a foreign company or an alien company, instead of the valuation of reserves required by paragraph (1) of this subsection, the Commissioner may accept a valuation made or caused to be made by the insurance supervisory official of another state if the valuation complies with the minimum standard under this subtitle.
Md. Code Ann., Ins. § 5-302 (2026)
Title 5. Assets, Liabilities, Reserves, and Investments of Insurers
Subtitle 3. Standard Valuation Law
§ 5–302LinkCopy Citation
Except as otherwise provided in §§ 5-305 and 5-306 of this subtitle, the minimum standard for the valuation of a policy or contract issued before the operative date of the Maryland Standard Nonforfeiture Law for Life Insurance is the minimum standard provided by former Article 48A, § 83(2) of the Code in effect on September 30, 1997.
Md. Code Ann., Ins. § 5-303 (2026)
Title 5. Assets, Liabilities, Reserves, and Investments of Insurers
Subtitle 3. Standard Valuation Law
§ 5–303LinkCopy Citation
(a)
Except as otherwise provided in §§ 5–305 and 5–306 of this subtitle for group annuity contracts and pure endowment contracts issued before the operative date of the Maryland Standard Nonforfeiture Law for Life Insurance:
(1)
§§ 5–304 through 5–312 of this subtitle apply only to policies and contracts, as appropriate, issued on or after that operative date and before the operative date of the valuation manual; and
(2)
§§ 5–313 and 5–314 of this subtitle do not apply to the policies and contracts.
(b)
Sections 5–313 and 5–314 of this subtitle apply to all life insurance policies, accident and health insurance contracts, and deposit–type contracts issued by a company on or after the operative date of the valuation manual.
Md. Code Ann., Ins. § 5-304 (2026)
Title 5. Assets, Liabilities, Reserves, and Investments of Insurers
Subtitle 3. Standard Valuation Law
§ 5–304LinkCopy Citation
(a)
(1)
Except as otherwise provided in §§ 5–305 and 5–306 of this subtitle, the minimum standard for the valuation of life insurance policies, annuity contracts, and pure endowment contracts is:
(i)
the Commissioners reserve valuation methods specified in §§ 5–307, 5–308, and 5–311 of this subtitle;
(ii)
the applicable tables in subsections (b) through (h) of this section; and
(iii)
except as provided in paragraph (2) of this subsection, interest at 3.5% per year.
(2)
For a policy or contract issued on or after July 1, 1978 other than an annuity contract or pure endowment contract, the interest rate is:
(i)
4% per year if the policy or contract was issued any time from July 1, 1978 to June 30, 1980, both inclusive; or
(ii)
(4)
5% per year if the policy or contract was issued on or after July 1, 1980.
(b)
For an ordinary policy of life insurance issued on the standard basis, excluding any disability and accidental death benefits in the policy, the applicable table for the minimum standard for the valuation of the policy is:
(1)
if the policy was issued before the operative date of § 16–308 of this article, the Commissioners 1941 Standard Ordinary Mortality Table;
(2)
if the policy was issued on or after the operative date of § 16–308 of this article but before the operative date of § 16–309 of this article:
(i)
the Commissioners 1958 Standard Ordinary Mortality Table; or
(ii)
at the election of the insurer, the Commissioners 1958 Standard Ordinary Mortality Table, calculating all modified net premiums and present values referred to in this subtitle for any category of policies issued on female risks according to an age not more than 6 years younger than the actual age of the insured; and
(3)
if the policy was issued on or after the operative date of § 16–309 of this article:
(i)
the Commissioners 1980 Standard Ordinary Mortality Table or, at the election of the insurer for any one or more specified plans of life insurance, the Commissioners 1980 Standard Ordinary Mortality Table with Ten–Year Select Mortality Factors; or
(ii)
any ordinary mortality table, adopted after 1980 by NAIC and approved by a regulation of the Commissioner for use in determining the minimum standard of valuation for the policy.
(c)
For an industrial life insurance policy issued on the standard basis, excluding any disability and accidental death benefits in the policy, the applicable table for the minimum standard for the valuation of the policy is:
(1)
if the policy was issued before the operative date of § 16–308(d) of this article, the 1941 Standard Industrial Mortality Table; and
(2)
if the policy was issued on or after the operative date of § 16–308(d) of this article:
(i)
the Commissioners 1961 Standard Industrial Mortality Table; or
(ii)
any industrial mortality table, adopted after 1980 by NAIC and approved by regulation of the Commissioner for use in determining the minimum standard of valuation for the policy.
(d)
For an individual annuity contract or pure endowment contract, excluding any disability and accidental death benefits in the contract, the applicable table for the minimum standard for the valuation of the contract is, at the option of the insurer:
(1)
the 1937 Standard Annuity Mortality Table;
(2)
the Annuity Mortality Table for 1949, Ultimate; or
(3)
a modification of a table specified by item (1) or (2) of this subsection approved by the Commissioner.
(e)
For a group annuity contract or pure endowment contract, excluding any disability and accidental death benefits in the contract, the applicable table for the minimum standard for the valuation of the contract is:
(1)
the Group Annuity Mortality Table for 1951;
(2)
a modification of the Group Annuity Mortality Table for 1951 approved by the Commissioner; or
(3)
at the option of the insurer, any of the tables or modifications of tables specified by subsection (d) of this section for individual annuity contracts and pure endowment contracts.
(f)
(1)
For total and permanent disability benefits in or supplementary to an ordinary policy or contract, the applicable table for the minimum standard for the valuation of the policy or contract is:
(i)
if the policy or contract was issued on or before December 31, 1960, the Class (3) Disability Table (1926);
(ii)
if the policy or contract was issued any time from January 1, 1961 to December 31, 1965, both inclusive:
(1)
the tables specified by item (i) of this paragraph; or
(2)
at the option of the insurer, the Class (3) Disability Table (1926); and
(iii)
if the policy or contract was issued on or after January 1, 1966:
(1)
the tables of Period 2 disablement rates and the 1930 to 1950 termination rates of the 1952 Disability Study of the Society of Actuaries, with due regard to the type of benefit; or
(2)
any tables of disablement rates and termination rates adopted after 1980 by NAIC and approved by regulation of the Commissioner for use in determining the minimum standard of valuation for the policy or contract.
(2)
For active lives, the table used under this subsection shall be combined with a mortality table allowed for calculating the reserves for life insurance policies.
(g)
(1)
For accidental death benefits in or supplementary to a policy, the applicable table for the minimum standard for the valuation of the policy is:
(i)
if the policy was issued on or before December 31, 1960, the Intercompany Double Indemnity Mortality Table;
(ii)
if the policy was issued any time from January 1, 1961 to December 31, 1965, both inclusive:
(1)
a table specified by item (i) of this paragraph; or
(2)
at the option of the insurer, the Intercompany Double Indemnity Mortality Table; and
(iii)
if the policy was issued on or after January 1, 1966:
(1)
the 1959 Accidental Death Benefits Table; or
(2)
an accidental death benefits table adopted after 1980 by NAIC and approved by regulation of the Commissioner for use in determining the minimum standard of valuation for the policy.
(2)
The table used under this subsection shall be combined with a mortality table allowed for calculating the reserves for life insurance policies.
(h)
For group life insurance, life insurance issued on the substandard basis, long–term home health care and long–term care in a nursing home or other related institution, or any other special benefit, the applicable table for the minimum standard for the valuation of the policy or benefit is any table approved by the Commissioner for use in determining the minimum standard of valuation of the policy.
Md. Code Ann., Ins. § 5-305 (2026)
Title 5. Assets, Liabilities, Reserves, and Investments of Insurers
Subtitle 3. Standard Valuation Law
§ 5–305LinkCopy Citation
(a)
(1)
Except as provided in § 5–306 of this subtitle and subject to paragraph (3) of this subsection, this section applies to:
(i)
all individual annuity contracts and pure endowment contracts issued on or after the operative date of this section; and
(ii)
all annuities and pure endowments purchased on or after the operative date under group annuity contracts and pure endowment contracts.
(2)
This section does not apply to any disability or accidental death benefit in a contract.
(3)
The operative date of this section is:
(i)
January 1, 1979; or
(ii)
the date or dates before January 1, 1979, specified by the insurer in a written notice filed with the Commissioner before January 1, 1979, of the insurer’s election of an earlier date or dates.
(b)
For an individual annuity contract or pure endowment contract issued on or before June 30, 1980, the applicable table and interest rate for the minimum standard for the valuation of the contract are:
(1)
the 1971 Individual Annuity Mortality Table or a modification of that table approved by the Commissioner; and
(2)
interest at:
(i)
6% per year for a single premium immediate annuity contract; and
(ii)
4% per year for any other individual annuity contract or pure endowment contract.
(c)
For an individual single premium immediate annuity contract issued on or after July 1, 1980, the applicable table and interest rate for the minimum standard for the valuation of the contract are:
(1)
(i)
the 1971 Individual Annuity Mortality Table;
(ii)
an individual annuity mortality table adopted after 1980 by NAIC and approved by regulation of the Commissioner for use in determining the minimum standard of valuation for the contract; or
(iii)
a modification of a table specified by subitem (i) or (ii) of this item approved by the Commissioner; and
(2)
interest at 7.5% per year.
(d)
For an individual annuity contract or pure endowment contract issued on or after July 1, 1980, other than a single premium immediate annuity contract, the applicable table and interest rate for the minimum standard for the valuation of the contract are:
(1)
(i)
the 1971 Individual Annuity Mortality Table;
(ii)
an individual annuity mortality table adopted after 1980 by NAIC and approved by regulation of the Commissioner for use in determining the minimum standard of valuation for the contract; or
(iii)
a modification of a table specified in subitem (i) or (ii) of this item approved by the Commissioner; and
(2)
interest at:
(i)
(5)
5% per year for a single premium deferred annuity contract or pure endowment contract; and
(ii)
(4)
5% per year for any other individual annuity contract or pure endowment contract.
(e)
For an annuity or pure endowment purchased on or before June 30, 1980, under a group annuity contract or pure endowment contract, the applicable table and interest rate for the minimum standard for the valuation of the contract are:
(1)
the 1971 Group Annuity Mortality Table or a modification of that table approved by the Commissioner; and
(2)
interest at 6% per year.
(f)
For an annuity or pure endowment purchased on or after July 1, 1980, under a group annuity contract or pure endowment contract, the applicable table and interest rate for the minimum standard for the valuation of the contract are:
(1)
(i)
the 1971 Group Annuity Mortality Table;
(ii)
a group annuity mortality table adopted after 1980 by NAIC and approved by regulation of the Commissioner for use in determining the minimum standard of valuation for the annuity or pure endowment; or
(iii)
a modification of a table specified in subitem (i) or (ii) of this item approved by the Commissioner; and
(2)
interest at 7.5% per year.
Md. Code Ann., Ins. § 5-306 (2026)
Title 5. Assets, Liabilities, Reserves, and Investments of Insurers
Subtitle 3. Standard Valuation Law
§ 5–306LinkCopy Citation
(a)
(1)
In this section the following words have the meanings indicated.
(2)
“Change in fund basis” means a valuation basis under which the interest rate used to determine the minimum valuation standard applicable to each change in a fund held under an annuity or under a guaranteed interest contract is the calendar year statutory valuation interest rate for the year of the change in the fund.
(3)
“Guarantee duration” means:
(i)
for life insurance, the maximum number of years the life insurance can remain in force on a basis guaranteed in the policy or under options to convert to plans of life insurance with premium rates, nonforfeiture values, or both, that are guaranteed in the original policy; and
(ii)
for an annuity or for a guaranteed interest contract:
(1)
if the annuity or the guaranteed interest contract has a cash settlement option, the number of years for which the contract guarantees interest rates in excess of the calendar year statutory valuation interest rate for life insurance policies with guarantee duration in excess of 20 years; and
(2)
if the annuity or the guaranteed interest contract does not have a cash settlement option, the number of years from the date of issue or date of purchase to the date annuity benefits are scheduled to commence.
(4)
“Issue year basis” means a valuation basis under which the interest rate used to determine the minimum valuation standard for the entire duration of the annuity or of the guaranteed interest contract is the calendar year statutory valuation interest rate for the year of issue or year of purchase of the annuity or guaranteed interest contract.
(b)
This section applies to:
(1)
all life insurance policies issued on or after the operative date of § 16–309 of this article;
(2)
all individual annuity contracts and pure endowment contracts issued on or after January 1, 1983;
(3)
all annuities and pure endowments purchased on or after January 1, 1983, under group annuity contracts or pure endowment contracts; and
(4)
the net increase, on or after January 1, 1983, in amounts held under guaranteed interest contracts.
(c)
Instead of the interest rates specified in §§ 5–304 and 5–305 of this subtitle, the interest rates used to determine the minimum standard for the valuation of a policy, contract, annuity, or pure endowment, or net increase described in subsection (b) of this section shall be:
(1)
for a life insurance policy or an individual annuity contract or pure endowment contract, the calendar year statutory valuation interest rate as determined under this section for the calendar year in which the policy or contract was issued;
(2)
for an annuity or pure endowment purchased under a group annuity contract or pure endowment contract, the calendar year statutory valuation interest rate as determined under this section for the calendar year in which the annuity or pure endowment was purchased; or
(3)
for a net increase in an amount held under a guaranteed interest contract, the calendar year statutory valuation interest rate as determined under this section for the calendar year in which the net increase occurred.
(d)
(1)
For purposes of the formulas under paragraph (2) of this subsection:
(i)
“I” is the calendar year statutory valuation interest rate;
(ii)
“R1” is the lesser of R and .09;
(iii)
“R2” is the greater of R and .09;
(iv)
“R” is the reference interest rate determined under subsection (f) of this section; and
(v)
“W” is the weighting factor determined under subsection (e) of this section.
(2)
(i)
Except as provided in paragraph (3) of this subsection, the calendar year statutory valuation interest rates shall be determined as provided in this paragraph, rounding the results to the nearest 1/4 percent.
(ii)
The calendar year statutory valuation interest rate for life insurance is:
I = .03 + W(R1 – .03) + W/2(R2 – .09).
(iii)
The calendar year statutory valuation interest rate for a single premium immediate annuity or for an annuity benefit involving a life contingency arising from another annuity or guaranteed interest contract that has a cash settlement option is:
I = .03 + W(R – .03).
(iv)
Except as provided in subparagraph (iii) of this paragraph, for an annuity or guaranteed interest contract that has a cash settlement option and is valued on an issue year basis:
(1)
the formula for life insurance under subparagraph (ii) of this paragraph applies if the annuity or guaranteed interest contract has a guarantee duration greater than 10 years; and
(2)
the formula for single premium annuities under subparagraph (iii) of this paragraph applies if the annuity or guaranteed interest contract has a guarantee duration of 10 years or less.
(v)
The formula for single premium annuities under subparagraph (iii) of this paragraph applies to any other annuity or guaranteed interest contract that does not have a cash settlement option.
(vi)
The formula for single premium annuities under subparagraph (iii) of this paragraph applies to any other annuity or guaranteed interest contract that has a cash settlement option and is valued on a change in fund basis.
(3)
(i)
If the calendar year statutory valuation interest rate for a life insurance policy issued in any calendar year determined without reference to this paragraph differs from the corresponding actual rate for a similar policy issued in the immediately preceding calendar year by less than 0.5%, the calendar year statutory valuation interest rate for that life insurance policy shall equal the corresponding actual rate for the immediately preceding calendar year.
(ii)
For purposes of this paragraph, the calendar year statutory valuation interest rate for a life insurance policy issued in a calendar year shall be:
(1)
determined for 1980 using the reference interest rate determined for 1979; and
(2)
determined for each calendar year since 1980 regardless of when § 16–309 of this article became operative.
(e)
(1)
(i)
In this subsection the following words have the meanings indicated.
(ii)
“Plan Type A” means a plan type under which:
(1)
at any time the policyholder may withdraw funds only:
(A)
with an adjustment to reflect changes in interest rates or asset values since receipt of the funds by the insurer;
(B)
without the adjustment required by item A of this item but in installments over 5 years or more; or
(C)
as an immediate life annuity; or
(2)
no withdrawal is allowed at any time.
(iii)
“Plan Type B” means a plan type under which:
(1)
before the expiration of the interest rate guarantee:
(A)
the policyholder may withdraw funds only with an adjustment to reflect changes in interest rates or asset values since receipt of the funds by the insurer;
(B)
the policyholder may withdraw funds without the adjustment required by item A of this item but in installments over 5 years or more; or
(C)
no withdrawal of funds is allowed; and
(2)
at the end of the interest rate guarantee, the policyholder may withdraw funds without the adjustment required by item 1A of this subparagraph in a single sum or installments over less than 5 years.
(iv)
“Plan Type C” means a plan type under which a policyholder may withdraw funds before the expiration of the interest rate guarantee in a single sum or in installments over less than 5 years:
(1)
without adjustment to reflect changes in interest rates or asset values since receipt of the funds by the insurer; or
(2)
subject only to a fixed surrender charge stipulated in the contract as a percentage of the fund.
(2)
For the purposes of this subsection, an insurer:
(i)
may elect to value annuities or guaranteed interest contracts that have cash settlement options on an issue year basis or a change in fund basis; and
(ii)
shall value annuities or guaranteed interest contracts that do not have cash settlement options on an issue year basis.
(3)
The weighting factor in the formulas under subsection (d) of this section shall be determined as provided in this subsection.
(4)
The weighting factor for life insurance is determined based on the guarantee duration of the life insurance as follows:
Guarantee Duration Weighting
(Years) Factor
10 or less .50
More than 10, but not more than 20 .45
More than 20 .35
(5)
The weighting factor for a single premium immediate annuity or for an annuity benefit involving a life contingency arising from another annuity or guaranteed interest contract that has a cash settlement option is .80.
(6)
Except as provided in paragraphs (5) and (8) of this subsection, the weighting factor for an annuity or guaranteed interest contract valued on an issue year basis is determined based on the guarantee duration of the annuity or contract as follows:
Guarantee Weighing Factor
Duration For Plan Type
(Years) A B C
5 or less .80 .60 .50
More than 5, but not more than 10: .75 .60 .50
More than 10 but not more than 20: .65 .50 .45
More than 20: .45 .35 .35
(7)
Except as provided in paragraphs (5) and (8) of this subsection, the weighting factor for an annuity or guaranteed interest contract valued on a change in fund basis is the weighting factor as determined under paragraph (6) of this subsection, increased by:
(i)
for Plan Type A, .15;
(ii)
for Plan Type B, .25; and
(iii)
for Plan Type C, .05.
(8)
The weighting factor as determined under paragraph (6) or (7) of this subsection shall be increased by .05 for:
(i)
an annuity or guaranteed interest contract that is valued on an issue year basis, has a cash settlement option, and does not guarantee interest rates on amounts received more than 12 months after issue or purchase; or
(ii)
an annuity or guaranteed interest contract that is valued on a change in fund basis and does not guarantee interest rates on amounts received more than 12 months beyond the valuation date.
(f)
(1)
(i)
In this subsection the following words have the meanings indicated.
(ii)
“Moody’s corporate bond yield average” means Moody’s corporate bond yield average – monthly average corporates, as published by Moody’s Investors Service, Inc.
(iii)
“12–month Moody’s corporate bond yield average” means the average of Moody’s corporate bond yield average over the 12–month period that ends:
(1)
for life insurance, on June 30 of the calendar year immediately preceding the year of issue;
(2)
for an annuity or guaranteed interest contract other than one described in item 3 of this subparagraph, on June 30 of the calendar year of issue or purchase; and
(3)
for an annuity or guaranteed interest contract that has a cash settlement option, is valued on a change in fund basis, is not a single premium immediate annuity, and is not an annuity benefit involving a life contingency arising from another annuity or guaranteed interest contract that has a cash settlement option, on June 30 of the calendar year of the change in the fund.
(iv)
“36–month Moody’s corporate bond yield average” means the average of Moody’s corporate bond yield average over the 36–month period that ends:
(1)
for life insurance, on June 30 of the calendar year immediately preceding the year of issue; and
(2)
for an annuity or a guaranteed interest contract, on June 30 of the calendar year of issue or purchase.
(2)
The reference interest rate in the formulas under subsection (d) of this section shall be determined as provided in this subsection.
(3)
For life insurance, the reference interest rate is the lesser of:
(i)
the 36–month Moody’s corporate bond yield average; or
(ii)
the 12–month Moody’s corporate bond yield average.
(4)
For a single premium immediate annuity or for an annuity benefit involving a life contingency arising from another annuity or guaranteed interest contract that has a cash settlement option, the reference interest rate is the 12–month Moody’s corporate bond yield average.
(5)
Except as provided in paragraph (4) of this subsection, for an annuity or guaranteed interest contract that has a cash settlement option, is valued on an issue year basis, and has a guarantee duration greater than 10 years, the reference interest rate is the lesser of:
(i)
the 36–month Moody’s corporate bond yield average; or
(ii)
the 12–month Moody’s corporate bond yield average.
(6)
Except as provided in paragraph (4) of this subsection, the reference interest rate is the 12–month Moody’s corporate bond yield average for any other annuity or guaranteed interest contract that:
(i)
has a cash settlement option, is valued on an issue year basis, and has a guarantee duration of 10 years or less;
(ii)
does not have a cash settlement option; or
(iii)
has a cash settlement option and is valued on a change in fund basis.
(7)
If Moody’s corporate bond yield average is no longer published by Moody’s Investors Service, Inc. or if NAIC determines that Moody’s corporate bond yield average is no longer appropriate to determine the reference interest rate, the Commissioner shall approve by regulation an alternative method adopted by NAIC to determine the reference interest rate.
Md. Code Ann., Ins. § 5-307 (2026)
Title 5. Assets, Liabilities, Reserves, and Investments of Insurers
Subtitle 3. Standard Valuation Law
§ 5–307LinkCopy Citation
(a)
(1)
In this subsection, “guaranteed benefits” means future guaranteed life insurance and endowment benefits.
(2)
Except as otherwise provided in paragraph (4) of this subsection and in §§ 5–308 and 5–311 of this subtitle, for the life insurance and endowment benefits of a policy that provides for a uniform amount of insurance and requires the payment of uniform premiums, the reserve according to the Commissioners reserve valuation method shall be the amount, if any, that the present value, at the date of valuation, of the guaranteed benefits under the policy exceeds the present value, at the date of valuation, of any future modified net premiums for the policy, as determined under paragraph (3) of this subsection.
(3)
(i)
For purposes of this subsection, the modified net premiums for a policy equal a uniform percentage of the respective contract premiums for the guaranteed benefits under the policy calculated so that the present value, at the date of issue of the policy, of the sum of all the modified net premiums equals the sum of:
(1)
the present value, at the date of issue, of the guaranteed benefits under the policy; and
(2)
the amount by which the net level annual premium determined under subparagraph (ii) of this paragraph exceeds a net 1–year term premium for the guaranteed benefits provided for in the first policy year.
(ii)
(1)
Except as provided in subsubparagraph 2 of this subparagraph, the net level annual premium to be used in the calculation in this paragraph equals a fraction:
(A)
the numerator of which is the present value, at the date of issue, of the guaranteed benefits provided for after the first policy year; and
(B)
the denominator of which is the present value, at the date of issue, of an annuity of one per year payable on the first and each subsequent anniversary of the policy on which a premium falls due.
(2)
The net level annual premium determined under this subparagraph may not exceed the net level annual premium on the 19–year premium whole life plan for insurance of the same amount at an age 1 year higher than the age at issue of the policy for which the reserve is calculated under this subsection.
(4)
(i)
(1)
In this paragraph the following words have the meanings indicated.
(2)
“Assumed ending date” means the first policy anniversary of a policy on which the sum of any endowment benefit under the policy and any cash surrender value available on that policy anniversary is greater than the excess first year premium.
(3)
“Excess first year premium” means the amount by which the contract premium in the first policy year of a policy exceeds the premium in the second policy year.
(ii)
This paragraph applies to a life insurance policy issued on or after January 1, 1986:
(1)
for which the contract premium in the first policy year exceeds the premium in the second year;
(2)
that does not provide a comparable additional benefit in the first year for the excess first year premium; and
(3)
that provides an endowment benefit or a cash surrender value or a combination in an amount greater than the excess first year premium.
(iii)
For a policy described in subparagraph (ii) of this paragraph, except as provided in § 5–311 of this subtitle, the reserve according to the Commissioners reserve valuation method as of any policy anniversary on or before the assumed ending date of the policy shall be the greater of:
(1)
the reserve calculated under paragraph (2) of this subsection; or
(2)
the reserve calculated under paragraph (2) of this subsection modified as follows:
(A)
the net level annual premium determined under paragraph (3)(ii) of this subsection shall be reduced by 15% of the excess first year premium;
(B)
all present values of benefits and premiums shall be determined without reference to premiums or benefits provided under the policy after the assumed ending date;
(C)
the policy shall be assumed to mature on the assumed ending date as an endowment; and
(D)
the cash surrender value provided on the assumed ending date shall be considered as an endowment benefit.
(iv)
In making the calculation under subparagraph (iii) of this paragraph, the mortality and interest bases stated in §§ 5–304 and 5–306 of this subtitle shall be used.
(b)
(1)
This subsection applies to:
(i)
life insurance policies that provide for a varying amount of insurance or require the payment of varying premiums;
(ii)
group annuity contracts and pure endowment contracts purchased under a retirement plan or plan of deferred compensation, established or maintained by an employer, an employee organization, or both, unless the plan provides individual retirement accounts or individual retirement annuities under § 408 of the Internal Revenue Code;
(iii)
disability and accidental death benefits and benefits for long–term home health care and long–term care in a nursing home or other related institution in all policies and contracts; and
(iv)
all other benefits, except:
(1)
life insurance and endowment benefits in life insurance policies; and
(2)
benefits provided by annuity contracts or pure endowment contracts not described in item (ii) of this paragraph.
(2)
For a policy, contract, or benefit to which this subsection applies, the reserve according to the Commissioners reserve valuation method shall be calculated by a method consistent with the principles of subsection (a) of this section, disregarding in the determination of modified net premiums any extra premiums charged because of impairments or special hazards.
Md. Code Ann., Ins. § 5-308 (2026)
Title 5. Assets, Liabilities, Reserves, and Investments of Insurers
Subtitle 3. Standard Valuation Law
§ 5–308LinkCopy Citation
(a)
(1)
Except as provided in paragraph (2) of this subsection, this section applies to all annuity contracts and pure endowment contracts.
(2)
This section does not apply to:
(i)
group annuity contracts or pure endowment contracts purchased under a retirement plan or plan of deferred compensation, established or maintained by an employer, an employee organization, or both, unless the plan provides individual retirement accounts or individual retirement annuities under § 408 of the Internal Revenue Code; or
(ii)
any disability and accidental death benefits and benefits for long-term home health care and long-term care in a nursing home or other related institution included in an annuity contract or pure endowment contract.
(b)
(1)
(i)
For benefits under an annuity contract or pure endowment contract to which this section applies, the reserve according to the Commissioners annuity reserve method shall be the greatest of the amounts determined for each respective contract year under subparagraph (ii) of this paragraph.
(ii)
For each contract year, there shall be determined the amount by which the present value, at the date of valuation, of the future guaranteed benefits, including guaranteed nonforfeiture benefits, under the contract at the end of the contract year exceeds the present value, at the date of valuation, of any future valuation considerations derived from future gross considerations that are required by the terms of the contract and become payable prior to the end of the contract year.
(2)
For purposes of this subsection:
(i)
the future guaranteed benefits shall be determined by using the mortality table, if any, and interest rate specified in the contract for determining guaranteed benefits; and
(ii)
the valuation considerations are the portions of the respective gross considerations applied under the terms of the contract to determine nonforfeiture values.
Md. Code Ann., Ins. § 5-309 (2026)
Title 5. Assets, Liabilities, Reserves, and Investments of Insurers
Subtitle 3. Standard Valuation Law
§ 5–309LinkCopy Citation
(a)
This section does not apply to reserves for disability and accidental death benefits and benefits for long-term home health care and long-term care in a nursing home or other related institution included in a life insurance policy.
(b)
An insurer’s aggregate reserves for all life insurance policies may not be less than the aggregate reserves calculated in accordance with:
(1)
the methods set forth in §§ 5-307, 5-308, 5-311, and 5-312 of this subtitle; and
(2)
the mortality tables and rates of interest used in calculating nonforfeiture benefits for those policies.
Md. Code Ann., Ins. § 5-310 (2026)
Title 5. Assets, Liabilities, Reserves, and Investments of Insurers
Subtitle 3. Standard Valuation Law
§ 5–310LinkCopy Citation
(a)
Subject to subsection (b) of this section, the Commissioner may establish any category of policies, contracts, or benefits for which reserves may be calculated, at the option of the insurer, under a standard that produces greater aggregate reserves for the category than the aggregate reserves calculated using the minimum standard provided in this subtitle.
(b)
(1)
This subsection does not apply to annuity contracts or pure endowment contracts.
(2)
The interest rate used to calculate the reserve for a policy or contract under a standard other than the minimum standard in this subtitle may not be higher than the corresponding interest rate used to calculate any nonforfeiture benefits provided by the policy or contract.
Md. Code Ann., Ins. § 5-311 (2026)
Title 5. Assets, Liabilities, Reserves, and Investments of Insurers
Subtitle 3. Standard Valuation Law
§ 5–311LinkCopy Citation
(a)
(1)
Except as provided in subsection (b) of this section, if in any contract year the gross premium charged by an insurer on a policy or contract is less than the valuation net premium for the policy or contract, the minimum reserve required for the policy or contract is the greater of:
(i)
the reserve calculated according to the mortality table, interest rate, and method actually used for the policy or contract; or
(ii)
the reserve calculated by using the method actually used for the policy or contract, but:
(1)
using the minimum valuation standards of mortality and of interest in §§ 5-304 and 5-306 of this subtitle; and
(2)
in each contract year for which the valuation net premium exceeds the actual gross premium, using the actual gross premium instead of the valuation net premium.
(2)
(i)
Except as provided in subparagraph (ii) of this paragraph, for purposes of paragraph (1) of this subsection, the valuation net premium for a policy or contract shall be calculated by the method used in calculating the reserve on the policy or contract using the minimum valuation standards of mortality and interest rate under §§ 5-304 and 5-306 of this subtitle.
(ii)
For future renewals under a renewable term insurance policy, the modern CSO mortality table published in The Transactions of The Society of Actuaries, Vol. XXVII (1975), shall be used instead of the minimum valuation standard of mortality under § 5-304 of this subtitle.
(3)
If the gross premium rates for a policy or contract are not based consistently on a suitable accepted or credible mortality basis or table, the Commissioner may require additional reserves in accordance with § 5-103(3) of this title.
(b)
For a life insurance policy described in § 5-307(a)(3)(ii) of this subtitle:
(1)
subsection (a) of this section shall be applied substituting the method described in § 5-307 of this subtitle, without regard to § 5-307(a)(4)(iii), for the method actually used in calculating the reserve for the policy; and
(2)
the minimum reserve at each policy anniversary of the policy shall be the greater of:
(i)
the minimum reserve calculated under § 5-307 of this subtitle, including § 5-307(a)(4)(iii); or
(ii)
the minimum reserve calculated under this section.
Md. Code Ann., Ins. § 5-312 (2026)
Title 5. Assets, Liabilities, Reserves, and Investments of Insurers
Subtitle 3. Standard Valuation Law
§ 5–312LinkCopy Citation
(a)
This section applies to:
(1)
a plan of life insurance that provides for future premiums to be determined by the insurer based on estimates of future experience; and
(2)
a plan of life insurance or annuity that is of a nature that precludes determining the minimum reserves by the methods described in §§ 5-307, 5-308, and 5-311 of this subtitle.
(b)
In accordance with regulations adopted by the Commissioner, the reserves that are held under a plan described in subsection (a) of this section shall:
(1)
be appropriate in relation to the benefits and pattern of premiums for that plan; and
(2)
be computed by a method that is consistent with the principles of this subtitle.
Md. Code Ann., Ins. § 5-313 (2026)
Title 5. Assets, Liabilities, Reserves, and Investments of Insurers
Subtitle 3. Standard Valuation Law
§ 5–313LinkCopy Citation
(a)
Except as provided in subsection (e) or (g) of this section, for life insurance policies, accident and health insurance contracts, and deposit–type contracts issued on or after the operative date of the valuation manual, the standard prescribed in the valuation manual is the minimum standard of valuation.
(b)
The operative date of the valuation manual is January 1 of the first calendar year following the first July 1 as of which all of the following have occurred:
(1)
the valuation manual has been adopted by NAIC by an affirmative vote of at least 42 members or 75% of the members voting, whichever is greater;
(2)
the Standard Valuation Law, as amended by NAIC in 2009, or legislation including substantially similar terms and provisions, has been enacted by states representing greater than 75% of the direct premiums written, as reported in the following annual statements submitted for 2008:
(i)
life, accident, and health annual statements;
(ii)
health annual statements; or
(iii)
fraternal annual statements; and
(3)
the Standard Valuation Law, as amended by NAIC in 2009, or legislation including substantially similar terms and provisions, has been enacted by at least 42 of the following 55 jurisdictions:
(i)
the 50 states of the United States;
(ii)
American Samoa;
(iii)
the U.S. Virgin Islands;
(iv)
the District of Columbia;
(v)
Guam; and
(vi)
Puerto Rico.
(c)
Unless a change in the valuation manual specifies a later effective date, changes to the valuation manual shall be effective on January 1 following the date when the change to the valuation manual has been adopted by NAIC by an affirmative vote representing:
(1)
at least 75% of the members of NAIC voting, but not less than a majority of the total membership; and
(2)
members of NAIC representing jurisdictions totaling greater than 75% of the direct premiums written, as reported in the following annual statements most recently available before the vote under item (1) of this subsection:
(i)
life, accident, and health annual statements;
(ii)
health annual statements; or
(iii)
fraternal annual statements.
(d)
(1)
The valuation manual shall specify the following:
(i)
the minimum valuation standards for each type of life insurance policy, accident and health insurance contract, and deposit–type contract issued by a company on or after the operative date of the valuation manual;
(ii)
the policies and contracts or types of policies and contracts that are subject to the requirements of a principle–based valuation under § 5–314 of this subtitle and the minimum valuation standards consistent with those requirements;
(iii)
for policies and contracts subject to a principle–based valuation under § 5–314 of this subtitle:
(1)
requirements for the format of reports to the Commissioner required under § 5–314(b)(1)(iii) of this subtitle, including the information necessary to determine if the principle–based valuation is appropriate and in compliance with this subtitle;
(2)
required assumptions for risks over which a company does not have significant control or influence; and
(3)
procedures for corporate governance and oversight of the actuarial function and a process for appropriate waiver or modification of those procedures;
(iv)
any other requirements, including requirements 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 memoranda, transition rules, and internal controls; and
(v)
the data and the form of the data required under § 5–315 of this subtitle, the person to whom the data must be submitted, and any other requirements considered necessary, including requirements relating to data analysis and reporting of analyses.
(2)
The minimum valuation standards required under paragraph (1)(i) of this subsection shall be known as:
(i)
the Commissioners reserve valuation method for life insurance policies, other than annuity contracts;
(ii)
the Commissioners annuity reserve valuation method for annuity contracts; and
(iii)
minimum reserves for all other policies or contracts.
(3)
For policies and contracts not subject to a principle–based valuation under § 5–314 of this subtitle, the minimum valuation standard shall:
(i)
be consistent with the minimum standard of valuation before the operative date of the valuation manual; or
(ii)
develop reserves that quantify the benefits and guarantees, and the funding, associated with the policies and contracts and their risks at a level of conservatism that reflects conditions that include unfavorable events that have a reasonable probability of occurring.
(e)
In the absence of a specific valuation requirement, or if a specific valuation requirement in the valuation manual is not, in the opinion of the Commissioner, in compliance with this subtitle, a company, with respect to the requirement, shall comply with the minimum valuation standard prescribed by the Commissioner by regulation.
(f)
(1)
The Commissioner may engage a qualified actuary at the expense of the company to:
(i)
perform an actuarial examination of a company and opine on the appropriateness of any reserve assumption or method used by the company; or
(ii)
review and opine on a company’s compliance with any requirement under this subtitle.
(2)
The Commissioner may rely on the opinion of a qualified actuary issued while the qualified actuary was employed by or under contract with the insurance supervisory official of another state.
(g)
(1)
The Commissioner may require a company to change any assumption or method used by the company if, in the opinion of the Commissioner, the change is necessary to comply with the requirements of the valuation manual or this subtitle.
(2)
The company shall adjust the company’s reserves as required by the Commissioner.
Md. Code Ann., Ins. § 5-314 (2026)
Title 5. Assets, Liabilities, Reserves, and Investments of Insurers
Subtitle 3. Standard Valuation Law
§ 5–314LinkCopy Citation
(a)
For policies and contracts specified in the valuation manual, a company shall establish reserves using a principle–based valuation that:
(1)
quantifies the benefits and guarantees, and the funding, associated with the policies or contracts and their risks at a level of conservatism that reflects conditions that include unfavorable events that have a reasonable probability of occurring during the lifetime of the policies or contracts;
(2)
for policies or contracts with significant tail risk, reflects conditions appropriately adverse to quantify the tail risk;
(3)
incorporates assumptions, risk analysis methods and financial models, and management techniques that are consistent with, but not necessarily identical to, those used within the company’s overall risk assessment process, while recognizing potential differences in financial reporting structures and any prescribed assumptions or methods;
(4)
incorporates assumptions that:
(i)
are prescribed in the valuation manual; or
(ii)
if not prescribed in the valuation manual:
(1)
are established using the company’s available experience, to the extent it is relevant and statistically credible; or
(2)
to the extent that company data is not available, relevant, or statistically credible, are established using other relevant, statistically credible experience; and
(5)
provides margins for uncertainty, including adverse deviation and estimation error, such that the greater the uncertainty the larger the margin and resulting reserve.
(b)
(1)
A company that uses a principle–based valuation for one or more policies or contracts subject to this section shall:
(i)
establish procedures for corporate governance and oversight of the actuarial valuation function consistent with those described in the valuation manual;
(ii)
provide to the Commissioner and the board of directors of the company an annual certification of the effectiveness of the company’s internal controls with respect to the principle–based valuation; and
(iii)
develop, and file with the Commissioner on request, a principle–based valuation report that complies with standards prescribed in the valuation manual.
(2)
The internal controls under paragraph (1)(ii) of this subsection shall be designed to ensure that:
(i)
all material risks inherent in the liabilities and associated assets subject to the principle–based valuation are included in the principle–based valuation; and
(ii)
principle–based valuations are made in accordance with the valuation manual.
(3)
The annual certification required under paragraph (1)(ii) of this subsection shall be based on the internal controls in place as of the end of the preceding calendar year.
(c)
A principle–based valuation may include a prescribed formulaic reserve component.
Md. Code Ann., Ins. § 5-315 (2026)
Title 5. Assets, Liabilities, Reserves, and Investments of Insurers
Subtitle 3. Standard Valuation Law
§ 5–315LinkCopy Citation
A company shall submit the mortality data, morbidity data, policyholder behavior, expense experience, and other data as prescribed in the valuation manual.
Md. Code Ann., Ins. § 5-316 (2026)
Title 5. Assets, Liabilities, Reserves, and Investments of Insurers
Subtitle 3. Standard Valuation Law
§ 5–316LinkCopy Citation
(a)
In this section, “confidential information” means:
(1)
a memorandum in support of an opinion submitted under § 5–201.1 of this title and any documents, materials, and other information, including all working papers and copies of all working papers, created, produced, or obtained by or disclosed to the Commissioner or any other person in connection with the memorandum;
(2)
any documents, materials, and other information, including all working papers and copies of all working papers, created, produced, or obtained by or disclosed to the Commissioner or any other person in the course of an examination made under § 5–313(f) of this subtitle;
(3)
(i)
any reports, documents, materials, and other information developed by a company in support of, or in connection with, an annual certification by the company under § 5–314(b)(1)(ii) of this subtitle evaluating the effectiveness of the company’s internal controls with respect to a principle–based valuation; and
(ii)
any documents, materials, and other information, including all working papers and copies of all working papers, created, produced, or obtained by or disclosed to the Commissioner or any other person in connection with the reports, documents, materials, and information specified in item (i) of this item;
(4)
a principle–based valuation report developed under § 5–314(b)(1)(iii) of this subtitle and any documents, materials, and other information, including all working papers and copies of all working papers, created, produced, or obtained by or disclosed to the Commissioner or any other person in connection with the principle–based valuation report; and
(5)
(i)
any documents, materials, data, and other information submitted to the Commissioner or any other person by a company under § 5–315 of this subtitle;
(ii)
any documents, materials, data, and other information, including all working papers and copies of all working papers, created or produced in connection with the documents, materials, data, and information specified in item (i) of this item that include any potentially company–identifying or personally identifiable information, that is provided to or obtained by the Commissioner or any other person; and
(iii)
any documents, materials, data, and other information, including all working papers and copies of all working papers, created, produced, or obtained by or disclosed to the Commissioner or any other person in connection with the documents, materials, data, and other information specified in items (i) and (ii) of this item.
(b)
Except as otherwise provided in this section, a company’s confidential information:
(1)
is confidential and privileged;
(2)
is not subject to Title 4 of the General Provisions Article; and
(3)
is not subject to subpoena or discovery or admissible in evidence in any private civil action.
(c)
(1)
The Commissioner, and any person who receives confidential information while acting under the authority of the Commissioner, may not testify or be required to testify in any private civil action concerning any confidential information.
(2)
The Commissioner may use confidential information of a company in any regulatory or legal action brought against the company as a part of the Commissioner’s official duties.
(d)
If an examination report or material prepared in connection with an examination made under Title 2, Subtitle 2 of this article is not private and confidential information under Title 2, Subtitle 2 of this article, an examination report or other material prepared in connection with an examination made under § 5–313(f) of this subtitle is not “confidential information” to the same extent as if the examination report or other material had been prepared under Title 2, Subtitle 2 of this article.
(e)
(1)
Subject to paragraph (2) of this subsection, to assist in the performance of the Commissioner’s duties, the Commissioner may share confidential information specified in:
(i)
subsection (a)(1) through (5) of this section with:
(1)
any state, federal, or international regulatory agency and the employees, agents, consultants, and contractors of any state, federal, or international regulatory agency; and
(2)
NAIC and the employees, agents, consultants, contractors, affiliates, and subsidiaries of NAIC; and
(ii)
subsection (a)(1) and (4) of this section with:
(1)
the Actuarial Board for Counseling and Discipline on a request from the Actuarial Board stating that the confidential information is required for the purpose of professional disciplinary proceedings; and
(2)
any state, federal, or international law enforcement official and the employees, agents, consultants, and contractors of any state, federal, or international law enforcement official.
(2)
Confidential information may be shared by the Commissioner under paragraph (1) of this subsection only if the recipient of the confidential information agrees, and has the legal authority to agree, to maintain the confidentiality and privileged status of any confidential information received in the same manner and to the same extent as required for the Commissioner.
(f)
(1)
The Commissioner may receive documents, materials, data, and other information, including otherwise confidential or privileged documents, materials, data, and information, from:
(i)
NAIC and the employees, agents, consultants, contractors, affiliates, and subsidiaries of NAIC;
(ii)
any state, federal, or international regulatory agency or law enforcement official and the employees, agents, consultants, and contractors of the regulatory agency or law enforcement official; and
(iii)
the Actuarial Board for Counseling and Discipline.
(2)
The Commissioner shall maintain as confidential and privileged any document, material, data, or other information received with notice or the understanding that it is confidential or privileged under the laws of the jurisdiction that is the source of the document, material, data, or other information.
(g)
The Commissioner may enter into agreements governing the sharing and use of confidential information consistent with this section.
(h)
(1)
Any applicable privilege or claim of confidentiality in confidential information is not waived as a result of:
(i)
the disclosure of the confidential information to the Commissioner under this section; or
(ii)
the sharing of the confidential information as authorized under subsection (e) of this section.
(2)
A privilege established under the law of another state that is substantially similar to the privilege established under this section shall be available and enforced in any proceeding in, and in any court of, the State.
(i)
Any confidential information specified in subsection (a)(1) and (4) of this section:
(1)
is subject to subpoena for defending in an action that:
(i)
seeks damages from the appointed actuary submitting the related memorandum in support of an opinion submitted under § 5–201.1 of this title or a principle–based valuation report developed under § 5–314(b)(1)(iii) of this subtitle; and
(ii)
is based on an action required by this subtitle or regulations adopted under this subtitle; and
(2)
may be released by the Commissioner with the written consent of the company.
(j)
All parts of a memorandum in support of an opinion submitted under § 5–201.1 of this title or a principle–based valuation report developed under § 5–314(b)(1)(iii) of this subtitle are no longer confidential information if any part of the memorandum or report is:
(1)
cited by the company in its marketing;
(2)
publicly volunteered to or before a governmental unit other than a state insurance department; or
(3)
released by the company to the news media.
Md. Code Ann., Ins. § 5-317 (2026)
Title 5. Assets, Liabilities, Reserves, and Investments of Insurers
Subtitle 3. Standard Valuation Law
§ 5–317LinkCopy Citation
(a)
The Commissioner may exempt a specific product form or product line of a domestic company that holds a certificate of authority issued by the Commissioner and is doing business only in the State from the requirements of § 5–313 of this subtitle if:
(1)
the Commissioner has issued an exemption in writing to the company;
(2)
the exemption has not been revoked in writing by the Commissioner; and
(3)
the company computes reserves:
(i)
using assumptions and methods used before the operative date of the valuation manual; and
(ii)
in accordance with any requirements established by the Commissioner by regulation.
(b)
(1)
A company that is granted an exemption under subsection (a) of this section is subject to § 5–201 of this title and §§ 5–302 through 5–312 of this subtitle.
(2)
With respect to a company that is granted an exemption under subsection (a) of this section, any reference to § 5–313 of this subtitle found in § 5–201.1 of this title and §§ 5–302 through 5–312 of this subtitle is not applicable.
(c)
The Commissioner may exempt a domestic company that holds a certificate of authority issued by the Commissioner and is doing business in the State from the requirements of §§ 5–314 and 5–315 of this subtitle if the company meets the life principle–based reserves exemption criteria in the valuation manual.
(d)
For purposes of subsection (c) of this section, ordinary life premiums are measured as direct premium plus reinsurance assumed from an unaffiliated company, as reported in the annual statement for the prior calendar year.
(e)
(1)
A domestic company that meets the requirements of subsection (c) of this section shall:
(i)
compute reserves:
(1)
using assumptions and methods used before the operative date of the valuation manual; and
(2)
in accordance with any requirements established by the Commissioner in regulation; and
(ii)
file, before July 1 of each year, a statement with the Commissioner certifying that the domestic company meets the requirements of subsection (c) of this section for the current calendar year based on premiums and other values from the financial statements for the prior calendar year.
(2)
Before September 1 of each year, the Commissioner may reject a statement filed under paragraph (1)(ii) of this subsection and require a domestic company to comply with the valuation manual requirements for life insurance reserves.