# Title 45 — Insurance, Commissioner of

## Article 45-04 — Life Insurance

## Chapter 45-04-07.2 — Preferred Mortality Tables

### § 45-04-07.2-01. Definitions.

1. "2001 CSO mortality table" means that mortality table consisting of separate rates of mortality
for male and female lives developed by the American academy of actuaries commissioners
standard ordinary task force from the valuation basic mortality table developed by the society
of actuaries individual life insurance valuation mortality task force and adopted by the national
association of insurance commissioners in December 2002. The 2001 CSO mortality table is
included in the Proceedings of the National Association of Insurance Commissioners (2nd
Quarter 2002) and supplemented by the 2001 CSO preferred class structure mortality table
described in subsection 2. Unless the context indicates otherwise, the 2001 CSO mortality
table includes both the ultimate form of that table and the select and ultimate form of that table
and includes both the smoker and nonsmoker mortality tables and the composite mortality
tables. It also includes both the age-nearest-birthday and age-last-birthday bases of the
mortality tables. Mortality tables in the 2001 CSO table include the following:
a. "2001 CSO mortality table (F)" means that mortality table consisting of the rates of
mortality for female lives from the 2001 CSO mortality table.
b. "2001 CSO mortality table (M)" means that mortality table consisting of the rates of
mortality for male lives from the 2001 CSO mortality table.
c. "Composite mortality tables" means mortality tables with rates of mortality that do not
distinguish between smokers and nonsmokers.
d. "Smoker and nonsmoker mortality tables" means mortality tables with separate rates of
mortality for smokers and nonsmokers.
2. "2001 CSO preferred class structure mortality table" means mortality tables with separate
rates of mortality for super preferred nonsmokers, preferred nonsmokers, residual standard
nonsmokers, preferred smokers, and residual standard smoker splits of the 2001 CSO
nonsmoker and smoker tables as adopted by the national association of insurance
commissioners at the September 2006 national meeting and published in the Proceedings of
the National Association of Insurance Commissioners (3rd Quarter 2006). Unless the context
indicates otherwise, the 2001 CSO preferred class structure mortality table includes both the
ultimate form of that table and the select and ultimate form of that table. It includes both the
smoker and nonsmoker mortality tables. It includes both the male and female mortality tables
and the gender composite mortality tables. It also includes both the age-nearest-birthday and
age-last-birthday bases of the mortality table.
3. "Commissioner" means the insurance commissioner.
4. "Statistical agent" means an entity with proven systems for protecting the confidentiality of
individual insured and insurer information, demonstrated resources for and history of ongoing
electronic communications and data transfer ensuring data integrity with insurers, which are its
members or subscribers, and a history of and means for aggregation of data and accurate
promulgation of the experience modifications in a timely manner.
History: Effective January 1, 2008.

General Authority: NDCC 28-32-02
Law Implemented: NDCC 26.1-35-02
### § 45-04-07.2-02. 2001 CSO preferred class structure table.

At the election of an insurer for each calendar year of issue, for any one or more specified plans of
insurance and subject to satisfying the conditions stated in this chapter, the 2001 CSO preferred class
structure mortality table may be substituted in place of the 2001 CSO smoker or nonsmoker mortality
table as the minimum valuation standard for policies issued on or after January 1, 2007. The election
may not be made until an insurer demonstrates at least twenty percent of the business to be valued on
this table is in one or more of the preferred classes. A table from the 2001 CSO preferred class
structure mortality table used in place of a 2001 CSO mortality table will be treated as part of the 2001
CSO mortality table only for purposes of reserve valuation pursuant to the requirements of the national
association of insurance commissioners model regulation, regarding recognition of the 2001 CSO
mortality table for use in determining minimum reserve liabilities and nonforfeiture benefits model
regulation as described in chapter 45-04-07.1.
History: Effective January 1, 2008.
General Authority: NDCC 28-32-02
Law Implemented: NDCC 26.1-35-02
### § 45-04-07.2-03. Conditions.

1. For each plan of insurance with separate rates for preferred and standard nonsmoker lives, an
insurer may use the super preferred nonsmoker, preferred nonsmoker, and residual standard
nonsmoker tables to substitute for the nonsmoker mortality table found in the 2001 CSO
mortality table to determine minimum reserves. At the time of election and annually after that,
except for business valued under the residual standard nonsmoker table, the appointed
actuary of the insurer shall certify to the commissioner that:
a. The present value of death benefits over the next ten years after the valuation date using
the anticipated mortality experience without recognition of mortality improvement beyond
the valuation date for each class is less than the present value of death benefits using
the valuation basic mortality table corresponding to the valuation table being used for that
class.
b. The present value of death benefits over the future life of the contracts using anticipated
mortality experience without recognition of mortality improvement beyond the valuation
date for each class is less than the present value of death benefits using the valuation
basic mortality table corresponding to the valuation table being used for that class.
2. For each plan of insurance with separate rates for preferred and standard smoker lives, an
insurer may use the preferred smoker and residual standard smoker tables to substitute for
the smoker mortality table found in the 2001 CSO mortality table to determine minimum
reserves. At the time of election and annually thereafter for business valued under the
preferred smoker table, the appointed actuary of an insurer shall certify to the commissioner
that:
a. The present value of death benefits over the next ten years after the valuation date using
the anticipated mortality experience without recognition of mortality improvement beyond
the valuation date for each class is less than the present value of death benefits using
the preferred smoker valuation basic mortality table corresponding to the valuation table
being used for that class.
b. The present value of death benefits over the future life of the contracts using anticipated
mortality experience without recognition of mortality improvement beyond the valuation

date for each class is less than the present value of death benefits using the preferred
smoker valuation basic mortality table.
c. Unless exempted by the commissioner, every authorized insurer using the 2001 CSO
preferred class structure table shall annually file with the commissioner, with the national
association of insurance commissioners, or with a statistical agent designated by the
national association of insurance commissioners and acceptable to the commissioner,
statistical reports showing mortality and such other information as the commissioner may
deem necessary or expedient for the administration of the provisions of this regulation.
The form of the reports shall be established by the commissioner or the commissioner
may require the use of a form established by the national association of insurance
commissioners or by a statistical agent designated by the national association of
insurance commissioners and acceptable to the commissioner.
History: Effective January 1, 2008.
General Authority: NDCC 28-32-02
Law Implemented: NDCC 26.1-35-02
