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Unamortized deferred acquisition costs and the present value of future profits (1) continue to be subject to premium deficiency testing in accordance with the provisions of FASB Statement No.
97 specifies that unamortized deferred acquisition costs related to traditional life insurance contracts replaced with universal life-type contracts issued by the same insurance enterprise shall not be deferred in connection with the replacement contract.
Subsequent modifications made only to the nonintegrated contract feature or coverage should be evaluated under paragraphs 9 through 15 of this SOP separately from the base contract, and any deferred acquisition costs related to the nonintegrated contract feature or coverage accounted for accordingly.
4a) Unamortized deferred acquisition costs, (5a) unearned revenue liabilities, and deferred sales inducement assets associated with the replaced contract should continue to be deferred and amortized or earned in connection with the replacement contract.