The ABCs of CSO & PBR

Two significant regulatory changes are affecting the Life Insurance Industry — Principle-Based Reserving (PBR) and a new standard mortality table, the 2017 Commissioners Standard Ordinary (CSO) Table. These regulations apply to all life insurance carriers.

PBR represents a change in the way carriers calculate reserves needed to pay future claims. Existing reserving formulas are more than 150 years old. Because products have evolved since then, the old one-size-fits-all approach to reserving is moving to a method aligned to the actual risk carriers assume on various products.

The new 2017 CSO table sets the mortality standard for calculating the minimum cash value, statutory reserves and death benefit required for a policy to be considered life insurance. It also specifies the maximum amount that can be charged for cost of insurance.

December 31, 2019: all non-compliant life products must be placed in force with premium. January 1, 2020: all life products sold on or after this date must be compliant with these regulations. Carriers have begun to send updates for their products in response to the upcoming CSO & PBR.

Changes to Policies on 2001 CSO Mortality Tables Endorsements will allow policyholders to maintain ability to make certain changes after January 1, 2020. Read the bulletin.

Important Reminder December 31, 2019 is the mandatory deadline for policy issue of products based on the 2001 CSO Mortality Table. Please review the John Hancock USA and John Hancock NY CSO FAQ’s for key deadlines and impacted products.

2017 CSO and PBR Updates – See them here.

2017 CSO updates for PL Promise products – Read the bulletin.

Key Protective Life 2017 CSO/PBR Product Updates – See the announcement.

Prudential’s Individual Life Insurance Portfolio Is Well Positioned Entering 2020 Prudential continues to focus on offering a broad portfolio of life insurance product solutions that meet various client needs. See Prudential’s Individual Life CSO/PBR Update.

2017 CSO Transition Guidelines for SBLI Products. Beginning January 1, 2020, SBLI – like all U.S. life insurers – must issue any new life insurance policy on the 2017 Commissioners Standard Ordinary (CSO) Tables. Read about the impact of this and the transition guidelines.

What you need to know about the new mortality tables and Principle Based Reserves (PBR) requirements Get the 2017 CSO Updates: Important dates and transition timelines.