§ 4517. Standard of valuation reserves. (a) The legal minimum standard\nof valuation for all life insurance certificates issued by an authorized\nsociety prior to January first, nineteen hundred fifty-seven shall be in\naccordance with provisions of law applicable thereto as of December\nthirty-first, nineteen hundred fifty-six, including the setting aside\nand maintenance of the required statutory contingency reserve on such of\nits certificates as are valued on an interest assumption in excess of\nthree and one-half percent per annum. The legal minimum standard of\nvaluation for all annuity contracts, and disability benefits and\naccident and sickness benefits in all certificates and contracts shall\nbe in accordance with the provisions of law applicable thereto as of\nDecember thirty-first, nineteen hundred fifty-six.\n (b) In every valuation report of every authorized society and in every\nvaluation of reserves made or caused to be made by the superintendent or\naccepted by him in lieu of such valuation, the reserve liability on all\ncertificates issued on and after January first, nineteen hundred\nfifty-seven shall be determined on a basis of the net tabular value of\nthe reserves on such certificates, not including any value for the right\nto make extra payments or to require additional insurance contributions.\nSuch tabular values shall not be less than the reserve determined\naccording to the commissioners reserve valuation method as defined in\nthis subsection. If the premium charged is less than the tabular net\npremium according to the basis of valuation used, an additional reserve\nequal to the present value of the deficiency in such premiums, as\ndetermined in the manner prescribed in section four thousand two hundred\neighteen of this chapter, shall be set up and maintained as a liability;\nprovided that, in the case of any society which is not qualifying with\nthe provisions of section four thousand five hundred fifteen of this\narticle, the deficiency reserve shall be determined on the basis of the\ndifference between the net insurance contribution, as in practice\nactually collected for life insurance benefits, and the tabular net\npremium. The reserve liability shall be properly adjusted in the event\nthat the mid-year or tabular values are not appropriate.\n (1) Reserves according to the commissioners reserve valuation method,\nfor the life insurance and endowment benefits of certificates providing\nfor a uniform amount of insurance and requiring the payment of uniform\npremiums shall be the excess, if any, of the present value, at the date\nof valuation, of such future guaranteed benefits provided for by such\ncertificates, over the then present value of any future modified net\npremiums therefor. The modified net premiums for any such certificate\nshall be such uniform percentage of the respective contract premiums for\nsuch benefits that the present value, at the date of issue of the\ncertificate, of all such modified net premiums shall be equal to the sum\nof the then present value of such benefits provided for by the\ncertificate and the excess of:\n (A) a net level premium equal to the present value, at the date of\nissue, of such benefits provided for after the first certificate year,\ndivided by the present value, at the date of issue, of an annuity of one\ndollar per annum payable on the first and each subsequent anniversary of\nsuch certificate on which a premium falls due; provided however, that\nsuch net level annual premium shall not exceed the net level annual\npremium on the nineteen year premium whole life plan for insurance of\nthe same amount at an age one year higher than the age at issue of such\ncertificate, over\n (B) a net one-year term premium for such benefits provided for in the\nfirst certificate year.\n (2) Reserves according to the commissioners reserve valuation method\nfor (i) life insurance certificates providing for varying amounts of\nbenefits or requiring the payment
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