(a) Applicability.--This section shall apply to an actuarial opinion prepared prior to the operative date of the valuation manual.

(b) Regulations regarding actuarial opinion.--Through regulations, the commissioner:

(1) Shall define the specifics of the actuarial opinion under this section and add any other items deemed to be necessary to fulfill the purpose of this section.

(2) May provide for a transition period for establishing any higher reserves that the qualified actuary may deem necessary in order to render the opinion required by this section.

(c) Annual submission and purpose.--Each company doing business in this Commonwealth shall annually submit the opinion of a qualified actuary as to whether the reserves and related actuarial items held in support of the company's policies and contracts specified by the commissioner by regulation:

(1) are computed appropriately;

(2) are based on assumptions that satisfy contractual provisions;

(3) are consistent with prior reported amounts; and

(4) comply with the applicable laws of this Commonwealth.

(d) Opinion regarding company obligations.--The following shall apply regarding the opinion of the qualified actuary and the company's obligations:

(1) Except as exempted by regulation, each company shall include in the actuarial opinion required under this section an opinion by the same qualified actuary as to whether the reserves and related actuarial items held in support of the company's policies and contracts specified by the commissioner by regulation, when considered in light of the assets held by the company with respect to the reserves and related actuarial items, including, but not limited to, the investment earnings on the assets and the considerations anticipated to be received and retained under the policies and contracts, make adequate provision for the company's obligations under the policies and contracts, including, but not limited to, the benefits under and expenses associated with the policies and contracts.

(2) A memorandum, in form and substance acceptable to the commissioner as specified by regulation, shall be prepared to support each actuarial opinion.

(3) If a company fails to provide a supporting memorandum at the request of the commissioner within a period specified by regulation or if the commissioner determines that the supporting memorandum provided by the company fails to meet the standards prescribed by regulation or is otherwise unacceptable to the commissioner, the commissioner may engage a qualified actuary at the expense of the company to review the opinion and the basis for the opinion and prepare the supporting memorandum required by the commissioner.

(e) Requirements.--Each actuarial opinion under this section shall be governed by the following:

(1) The opinion shall be submitted with the annual statement reflecting the valuation of the reserve liabilities for each year ending on or after December 31, 1993.

(2) The opinion shall apply to all business in force, including individual and group accident and health insurance plans, in form and substance acceptable to the commissioner as specified by regulation.

(3) The opinion shall be based on standards adopted from time to time by the Actuarial Standards Board, or its successor, and on any additional standards as specified by regulation.

(4) In the case of an opinion required to be submitted by a foreign or alien company, the commissioner may accept the opinion filed by that company with the insurance supervisory official of another state if the commissioner determines that the opinion reasonably meets the requirements applicable to a company domiciled in this Commonwealth.

(5) Except in cases of fraud or willful misconduct, a qualified actuary shall not be liable for damages to any person, other than the insurance company or fraternal benefit society and the commissioner, for any act, error, omission, decision or conduct with respect to the actuarial opinion.

(6) Disciplinary action by the commissioner against the company, fraternal benefit society or the qualified actuary shall be prescribed by regulation.

(7) The confidentiality provisions under Subchapter C (relating to confidentiality) shall apply.

(f) Definitions.--As used in this section, the following words and phrases shall have the meanings given to them in this subsection unless the context clearly indicates otherwise:

"Qualified actuary." A member in good standing of the American Academy of Actuaries who meets the requirements under 31 Pa. Code Ch. 84b (relating to actuarial opinion and memorandum).

Cross References. Section 7113 is referred to in sections 7120, 7121, 7131, 7137 of this title.