(85)
(e)
The marginMargin does not need to take into account the possibility of catastrophic events which are implausible in usual operations.
(f)
The marginMargin shall satisfy any further conditions set forth by this regulationthese requirements or any supporting actuarial guidelines and applicable Actuarial Standards of Practice with respect to marginMargins or prudent best estimate assumptionPrudent Estimate Assumptions for the risk factor.
(g)
Unless there are clear reasons to expect otherwise, a higher marginMargin shall be established when: Experience data are lacking or limited as compared to the case if abundant and relevant experience data are available;
(ii)
There is doubt about the reliability of the best estimate assumptionAnticipated Experience Assumption, such as, but not limited to recent changes in circumstances, or changes in company policies;
(iii)
An approximation with less precision is being used;
(iv)
The experience is not relevant and credible and the event assumed is further in the future; or
(v)
There are contingencies related to policyholder behavior in situations where a given policyholder action results in the surrender or exercise of a valuable option.
Impact of each Margin (a)
(b)
(96)
(i)
The actuary shall determine and disclose in the Aactuarial Rreport an estimate of the impact of each marginMargin on the Ddeterministic Rreserve for the following Rrisk Ffactors: mortality, policyholder behavior, expense and asset return assumptions. This shall be determined for each Aasset Ssegment by: (i)
Calculating the sum of Sseriatim Rreserves based on the Abest estimatenticipated Experience Aassumption for the Rrisk Ffactor and Pprudent best estimaterudent Estimate Assumptions for all other Rrisk Ffactors; and
(ii)
Subtracting the value determined in Paragraph 85(a)(i) above from the sum of Sseriatim Rreserves as reported.
Since the actuary does not determine an Abest estimatenticipated Experience Aassumption or a Pprudent best estimaterudent Estimate Aassumption for assumptions that are prescribed (e.g. interest rates movements, equity performance and net spreads on reinvestment assets), the prescribed assumption shall be deemed to be the Pprudent best estimaterudent Estimate Aassumption, and the equivalent of an “Abest estimatenticipated Experience Assumption� assumption for each of these Rrisk Ffactors will be prescribed by the NAIC for the purpose of determining the impact of each Mmargin as required by this Section.
Impact of Aggregate Margin (a)
The actuary shall determine and disclose in the Aactuarial Rreport an estimate of the aggregate impact of the all Mmargin on the Deterministic Reserve for each Aasset Ssegment by:
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