The Commissioner’s Standard Ordinary Mortality Table (often called the CSO table) is a regulatory mortality table used in life insurance. It provides age-based mortality assumptions that insurers use for pricing, reserve calculations, and certain statutory values such as nonforfeiture benefits.
In plain terms, it is one of the benchmark tables that helps determine how much mortality risk a life insurer is assuming when it issues ordinary life policies.
Why it matters
Life insurance pricing and valuation depend on assumptions. Mortality is one of the most important assumptions because the insurer needs to estimate how frequently death claims are likely to occur across different ages and risk classes.
The CSO table matters because it helps support:
- premium calculations
- statutory reserve requirements
- nonforfeiture value calculations
- product design and illustration assumptions, subject to regulation
Different CSO tables have been adopted over time as mortality experience has changed.
Regulatory role
The CSO table is not just an internal actuarial tool. It has a regulatory role because state insurance laws and regulations often refer to specific mortality tables for minimum reserves or nonforfeiture standards. That helps create consistency across insurers and protects policyholders from overly aggressive assumptions.
Practical example
Suppose two otherwise similar life insurance products use different mortality assumptions. The product using a heavier mortality assumption may require different reserve and pricing treatment than a product using a lighter assumption. In regulated life insurance markets, insurers cannot simply choose any mortality assumption they want for statutory purposes; the approved table framework matters.
Related Terms
- Mortality Table
- Nonforfeiture Values
- Legal Reserve
- Mortality Rate
- Cash Surrender Value
- Ordinary Life Policy