In the business of insurance, statutory reserves are those assets an insurance company is legally required to maintain on its balance sheet with respect to the unmatured obligations (i.e., expected future claims) of the company.
These reserves must be reported in statements filed with insurance regulatory bodies.
The size of a CRVM reserve, as with most life reserves, is affected by the age and sex of the insured person, how long the policy for which it is computed has been in force, the plan of insurance offered by the policy, the rate of interest used in the calculation, and the mortality table with which the actuarial present values are computed.
Subsequent amendments to the Standard Valuation Law have permitted the use of more modern mortality tables and higher rates of interest.
The effect of these changes has in general been to reduce the amount of the reserves which life insurance companies are legally required to hold.