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losses on life insurance but would measure accrued
unpaid losses on accident and health insurance. The
Service is unable to explain why Congress would want to
treat accrued unpaid losses on the two kinds of
insurance differently. Indeed, the Service concedes
that, if anything, Congress thought that accident and
health insurance (at least when noncancelable) should
be treated just like life insurance. * * * [Harco
Holdings, Inc. v. United States, supra at 1034.]
We are also mindful of section 1.801-3(g), Income Tax Regs.,
which provides:
Sec. 1.801-3. Definitions.
this section defines the following terms, which are to
be used in determining if a taxpayer is a life
insurance company (as defined in section 801(a) and
paragraph (b) of this section):
* * * * * * *
(g) Unpaid losses (whether or not ascertained).
The term “unpaid losses (whether or not ascertained)”
means a reasonable estimate of the amount of the losses
(based upon the facts in each case and the company's
experience with similar cases)--
(1) Reported and ascertained by the end
of the taxable year but where the amount of
the loss has not been paid by the end of the
taxable year,
(2) Reported by the end of the taxable
year but where the amount thereof has not
been either ascertained or paid by the end of
the taxable year, or
(3) Which have occurred by the end of
the taxable year but which have not been
reported or paid by the end of the taxable
year.
Respondent concedes that these regulations do not distinguish
between accrued and unaccrued unpaid losses on CA&H insurance,
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