Description: S&P reissued a second Request for Comment (RFC) in May 2023 that proposed changes to their insurer capital adequacy methodology and assumptions, and suggested these proposed changes may become effective at the end of 2023. This paper is to highlight the notable changes between the current capital model criteria and the proposed model. We also discuss major changes from the first RFC and the second RFC, as well as several key items that still require enhanced guidance and clarification. Our analysis is based on information gathered from S&P's public comments, conversations with industry participants, and publications released by S&P Global as of July 2023 when this paper was written. Most U.S. life insurers are rated by S&P using their U.S. Life Statutory Capital model, while other insurers use the GAAP/IFRS Capital Model. Statutory financials will remain the starting point for U.S. life insurers under the proposed model, however there will be additional adjustments made to these numbers in an effort to create consistency and comparability with other accounting and solvency regimes.

Description: This article helps companies better understand the currently proposed upcoming VM-22 regulation by comparing the VM-22 measurement model to LDTI MRBs. The article highlights key considerations as companies plan for adoption of these two measurement models. These considerations should help inform a company’s strategy related to the business impacted by these standards.

Description: In preparing claims reserves in the annual statement, health insurers and their opining actuaries will generally include a provision for adverse deviation (PAD) in their reserved amount in order to satisfy language in both in the National Association of Insurance Commissioners (NAIC) Health Annual Statement Instructions and in Actuarial Standards of Practice. This article explores the total level of PAD (both implicit and explicit margin combined) included in the reported claims reserves by examining NAIC filing data from 2016 through 2022.

Description: S&P Global released its initial version of proposed changes regarding its Insurer Risk-Based Capital Adequacy methodology and assumptions on Dec. 6th, 2021. Unlike prior guidance notes or criteria releases, the proposed changes comprehensively updated the current S&P rating criteria released in 2010. These updates would directly impact many insurers. S&P Global anticipates that 10 percent of existing ratings in the insurance sector would be impacted and the change would lead to more positive rating implications than negative impact. This article focuses on the proposed changes on the S&P risk-based capital (RBC) vs. the current model, then simulate impacts to a representative U.S. life insurer through an illustrative case study.

Description: TAXING TIMES recently sat down with a group of retired tax actuaries to hear about how they got involved in actuarial tax matters and how their tax experience impacted their careers. Their insights will be useful for actuaries who are just starting out in the profession, as well as more seasoned actuaries.

Description: The Society of Actuaries will host two great events for the valuation actuarial community. Get empowered for success with in-depth content on the latest valuation and financial reporting concepts, including US GAAP, US Tax Account, and International Reporting Standards (IFRS).

Description: The Life Meeting, is the result of combining the Life & Annuity Symposium (LAS) and the Valuation Actuarial Symposium (ValAct). The Life Meeting will offer sessions specific to pricing and valuation as well as sessions on emerging issues relevant to both groups. These common themes include InsurTech, diversity, accounting change and the current economic environment.

Description: From a session at the 2000 Valuation Actuary Symposium held in Washington DC, September 14-15, 2000 Panelists use recent transactions and examples to demonstrate various operational, financial reporting and strategic aspects of insurance company mergers.

Description: Description of the mathematics involved when looking at low probability events within a company from the perspective of the C-Suite. The accumulation of small probability events leads to a much higher probability of at least one of them happening in a given period.

Description: Under the new reporting regimes actuaries have the opportunity to become leaders for all aspects of cash flows and related insights, rather than just the reserve change line on the income statement, to help educate the organization and informed business decisions. This session will provide practical examples and scenarios where actuaries take on leadership roles to drive reporting compliance and organizational changes; as well as provide an opportunity to discuss what didn’t work as well when it came to deploying new technologies to the valuation and pricing teams.