SECTIONS 12640.16 - California Statutes

INSURANCE CODE

SECTION 12640.16

12640.16. (a) The provisions of Article 10 (commencing with Section
900), Chapter 1, Part 2, Division 1, relating to financial
statements, shall apply to mortgage guaranty insurers.
(b) The unearned premium reserve shall be computed in accordance
with the other applicable sections of this code, except that on all
policies covering a risk period of more than one year the unearned
premium reserve shall be computed in accordance with standards
promulgated by the commissioner after appropriate hearings.
(c) In addition to the contingency reserve required under Section
12640.04, the case basis method shall be used to determine the loss
reserve, which shall include a reserve for claims reported and unpaid
and claims incurred but not reported, including:
(i) Estimated losses on insured loans which have resulted in the
conveyance of property which remains unsold.
(ii) Insured loans in the process of foreclosure.
(iii) Insured loans in default for four or more months.