100 STAT. 2402
PUBLIC LAW 99-514—OCT. 22, 1986 subsequent year in an amount equal to the amount of the losses treated as paid in the 9th year after the accident year (or, if lesser, the portion of the unpaid losses not theretofore taken into account). Notwithstanding clause (ii), to the extent such unpaid losses have not been treated as paid before the last year of the extension, they shall be treated as paid in such last year. "(D) LONG-TAIL LINE OF BUSINESS.—-For purposes of subparagraph (C), the term 'long-tail line of business' means any line of business described in subparagraph (A)(ii) if the amount of losses which (without regard to subparagraph (O) would be treated as paid in the 10th year after the accident year exceeds the losses treated as paid in the 9th year after the accident year. "(E) SPECIAL RULE FOR INTERNATIONAL AND REINSURANCE LINES OF BUSINESS.—Except as otherwise provided by regu-
lations, any determination made under subsection (a) with respect to unpaid losses relating to the international or reinsurance lines of business shall be made using, in lieu of the loss payment pattern applicable to the respective lines of business, a pattern determined by the Secretary under paragraphs (1) and (2) based on the combined losses for all lines of business described in subparagraph (A)(ii). "(F)
ADJUSTMENTS IF LOSS
EXPERIENCE INFORMATION
AVAILABLE FOR LONGER PERIODS.—The Secretary shall make appropriate adjustments in the application of this paragraph if annual statement data with respect to payment of losses is available for longer periods after the accident year than the periods assumed under the rules of this paragraph. "(G) SPECIAL RULE FOR 9TH YEAR IF NEGATIVE OR ZERO.—If
the amount of the losses treated as paid in the 9th year after the accident year is zero or a negative amount, subparagraphs (C)(ii) and (D) shall be applied by substituting the average of the losses treated as paid in the 7th, 8th, and 9th years after the accident year for the losses treated as paid in the 9th year after the accident year. "(4) DETERMINATION YEAR.—For purposes of this section, the term 'determination year' means calendar year 1987 and each 5th calendar year thereafter. "(e) ELECTION To U S E COMPANY'S HISTORICAL PAYMENT PATTERN.—
"(1) IN GENERAL.—The taxpayer may elect to apply subsection (a)(2)(C) with respect to all lines of business by using a loss payment pattern determined by reference to the taxpayer's loss payment pattern for the most recent calendar year for which an annual statement was filed before the beginning of the accident year. Any such determination shall be made with the application of the rules of paragraphs (2)(C) and (3) of subsection (d). "(2) ELECTION.—
"(A) IN GENERAL.—An election under paragraph (1) shall be made separately with respect to each determination year under subsection (d). "(B) PERIOD FOR WHICH ELECTION IN EFFECT.—Unless re-
voked with the consent of the Secretary, an election under paragraph (1) with respect to any determination year shall
�
