insurance reserves

Definition

A stated amount or percent of liquid assets that an insurer must have on hand that will satisfy all claims from in-force insurance policies and other outstanding liabilities. Reserve limits are established by state regulatory agencies which calculate reserves as a percent of the total present value of in-force insurance less the present value of future premiums to be received plus interest.

Use insurance reserves in a sentence

You should try and make sure that you have shopped around to get the best price you can on your insurance reserves.

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We double checked to make sure we weren't dipping into our insurance reserves, as things were extraordinarily tight this quarter.

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My department manager approached our company CEO because he was concerned that the hurricane would result in our insurance reserves dropping below regulatory thresholds.

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