Valuation Reserve

Definition

  • A reserve kept by insurance companies, and required by law, that is used to act as a contingency in case the insurer's investments are overvalued or if a liability turns out to be larger than expected.

Synonyms
stockpile, set-aside, overcompensate, buffer

Related Terms and Acronyms

  • Bank Reserves Definition,
    • Banks' holdings of deposits.
  • Legal Reserve Definition,
    • The legally mandated minimum amount of money an insurer must keep liquid in order to satisfy its obligations to policyholders.
  • Loss Reserve Definition,
    • A reserve of money and liquid assets set aside by an insurer for the payment of claims that have been submitted but have yet to be paid out.
  • Total Admitted Assets Definition,
    • What assets an insurance company is legally allowed to include when determining its financial solvency.
  • Voluntary Reserve Definition,
    • A reserve kept by an insurer for future claims that is larger than is required by government regulations.
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