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MichaelBurton,
Like many other things in financial services, you always need to remember to ask this question:
"Compared to what?"
Why should the state of New York require higher reserves than any (every) other state in the United States? Which, coincidentally, is already 100% legal reserves for every death benefit promise on the books?
Life insurance companies must be able to pay all claims, should the need arise. That's in every state. So, why should New York require a HIGHER reserve than 100%? Because regulators want it that way.
Like many other things in financial services, you always need to remember to ask this question:
"Compared to what?"
Why should the state of New York require higher reserves than any (every) other state in the United States? Which, coincidentally, is already 100% legal reserves for every death benefit promise on the books?
Life insurance companies must be able to pay all claims, should the need arise. That's in every state. So, why should New York require a HIGHER reserve than 100%? Because regulators want it that way.