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California Issues Final Expense Bulletin

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The Golden State is asking insurers to stick with the 1980 Commissioners Standard Ordinary Life Valuation Mortality Table for “preneed” life insurance policies issued after Jan. 1, 2012.

The California Department of Insurance says insurers that sell policies that cover funerals, cremations, urns and other expenses incurred around the time of death can simply stick with the “Ultimate 1980 CSO” table – a version of the 1980 CSO table that excludes 10-year selection factors.

Preneed insurers that want to use any other approved table, such as the 2001 Commissioners Standard Ordinary table, to calculate minimum reserves over the next 2 years should file annual actuarial statements certifying that the company really is accumulating enough reserves to fund the promised benefits, department officials write in Bulletin 2008-2.

When state law requires preneed insurers to use a gender-neutral mortality table, “a mortality table that is a blend of the Ultimate 1980 CSO (Male) and the Ultimate 1980 CSO (Female) may, at the option of the company for each plan of insurance, be substituted for the Ultimate 1980 CSO,” officials write.


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