risk-based capital (RBC) requirements
A method developed by the National Association of Insurance Commissioners
(NAIC) to determine the minimum amount of capital required of an insurer to
support its operations and write coverage. The insurer's risk profile (i.e.,
the amount and classes of business it writes) is used to determine its risk-based
capital requirement. Four categories of risk are analyzed in arriving at an
insurer's minimum capital requirement: asset, credit, underwriting, and off-balance-sheet.
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