The time limit set by law during which a person must bring legal action on a case.
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MEDICAL, USA: 1. Time limit established for filing lawsuits; may vary from state to state. 2. Specific period of time after a patient receives medical services in which a claim must be filed and after which lapse of time the claim may no longer be enforced.
Insurance Encyclopedia
Statute-barred
A civil claim that cannot be brought because it is outside the time permitted by statute (Limitation Act 1980) is ‘statute barred’. See also the LATENT DAMAGES ACT 1986.
Statutory
Mandated by law or by a statute.
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Required by or having to do with law or statute.
Statutory absolution
See: REHABILITATION OF OFFENDERS ACT 1974.
Statutory Accounting
Accounting prescribed by Regulatory authority for insurance companies. Under the statutory accounting system GAAP (General Accepted Accounting Principles) are not followed, but statutory conventions replace GAAP.
statutory accounting practices (SAP)
Guidelines that insurance companies are required to follow when filing an annual financial statement (convention blank) with state insurance regulatory authorities. Statutory accounting is more conservative than generally accepted accounting principles (GAAP) because it overstates expenses and liabilities and understates income and assets. Also see generally accepted accounting principles (GAAP) .
Statutory accounting principals
Legally mandated principles the insurer must follow when preparing a financial statement to the state insurance department.
Statutory accounting principles (SAP)
Statutorily mandated accounting principles and practices that must be followed when an insurance company submits its annual financial statement to the department of insurance. The principal objective of statutory accounting is to provide a framework for a conservative measurement of an insurer’s surplus. In contrast to Generally Accepted Accounting Principles (GAAP), which are followed by most other businesses. See GAAP accounting.
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US: Rules for insurance accounting codified by the National Association of Insurance Commissioners (NAIC) or as promulgated by a domicile as rules to be used in reporting an insurer’s results to regulators. These rules focus on the balance sheet and solvency analysis, and differ from the generally accepted accounting principles (GAAP) used for other types of businesses. For example, statutory accounting rules do not allow the inclusion of certain nonadmitted assets on the balance sheet; require that certain loss reserves be set by conservative formulas instead of the insurer’s estimates; require the insurer to immediately recognize the expenses associated with writing new business instead of amortizing them over the policy period; and do not allow premiums for reinsurance placed with unauthorized reinsurers to be recognized as an asset.
Statutory Annual Statement
See: Annual Statement, Convention Blank.
Statutory capital
The amount of capital and/or surplus required in order for an insurance company to obtain and retain a license to do business. May be stated as a minimum dollar amount or by reference to a solvency ratio or a solvency margin.