Statutory Reserve
/ˈstætʃ.uˌtɔr.i rɪˈzɜrv/
Definitions
- (n.) A fund or amount required by statute that insurance companies must set aside to cover future policy claims.
The insurer must maintain a statutory reserve to ensure sufficient funds for policyholder claims.
Forms
- statutory reserve
- statutory reserves
Related terms
See also
Commentary
Statutory reserves are mandated by law to protect policyholders, distinct from voluntary reserves; drafters should specify the governing statute or regulatory framework when defining such reserves.
This glossary is for general informational and educational purposes only. Definitions are jurisdiction-agnostic but reflect terminology and concepts primarily drawn from English and American legal traditions. Nothing herein constitutes legal advice or creates a lawyer-client relationship. Users should consult qualified counsel for advice on specific matters or jurisdictions.