1994 Alaska Statutes
TITLE 21 INSURANCE
Chapter 21.18. ASSETS AND LIABILITIES
Sec. 21.18.073. UNEARNED PREMIUM RESERVE FOR TITLE INSURANCE.

In addition to an adequate reserve as to outstanding losses as required under AS 21.18.050 , a title insurer shall establish, segregate, and maintain a guaranty fund or unearned premium reserve as provided in this section. At all times and for all purposes, the sums required by this section to be reserved for unearned premiums on title guarantees and policies shall be considered and constitute unearned portions of the original premiums and shall be charged as a reserve liability of the insurer in determining its financial condition. While the sums are reserved, they are withdrawn from the use of the insurer for its general purposes, constitute a trust in favor of the holders of title guarantees and policies, and must be held available for reinsurance of the title guarantees and policies in the event of the insolvency of the insurer. This section does not preclude the insurer from investing the reserves in investments authorized by law for the insurer. The income from invested reserves may be included in the general income of the insurer to be used by the insurer for a lawful purpose. The unearned premium reserve required by this section consists of not less than the amount computed as follows with respect to a policy of title insurance issued by a title insurer after December 31, 1990:

(1) 10 percent of the total amount of risk premiums written in the calendar year for title insurance contracts must be assigned originally to the reserve;

(2) during each of the 20 years immediately following the year in which the title insurance contract was issued, the reserve applicable to the contract must be reduced by five percent of the original amount of the reserve; with respect to a policy of title insurance issued by a title insurer before January 1, 1991, the insurer shall maintain at all times a reserve of not less than $.30 for each $1,000 of the fee amount of all title guarantees and policies issued during the preceding 10 years; this reserve amount, required to be reserved for unearned premiums on title guarantees and policies, shall at all times and for all purposes be considered and constitute unearned portions of the original premiums and shall be charged as a reserve liability of the insurer in determining its financial condition; that portion of the unearned premium reserve established with respect to a title guarantee or policy issued more than 10 years before January 1, 1991, shall be released, shall no longer constitute part of the unearned premium reserve, and may be used for any purpose by the insurer.