Description: An ongoing discussion of the theoretically correct discount rate for valuing insurance liabilities: whether or not the credit rating of the insurer should affect the discount rate used. See related articles including the article “On the Fair Value of Insurance Liabilities: The Regulator’s Option” in the December, 2005 issue of The Financial Reporter.

Description: Discussion rebutting the Dec. 2004 issue of The Financial Reporter article titled, “On the Fair Value of Insurance Liabilities,” authored by Don Solow. That article expressed disagreement with the position of the International Accounting Standards Board and the Financial Accounting Standards Board to reflect the value of “own credit risk” in the fair valuation of insurance liabilities.

Description: 1999 SOA Annual Meeting, San Francisco. The panelists reviewed emerging proposals for reporting liabilities at fair value. Topics covered: 1. The Fair-Value Symposium in March 1999. 2. The measures and objectives of fair-value reporting. 3. The implication for the income statement and balance sheet. 4. The alternatives to fair-value reporting, such as embedded value. 5. The impact on asset/liability management. 6. The status of deliberations at the Financial Accounting Standards Board and the AICPA.

Description: Full version of The Financial Reporter, Issue No. 65, June 2006.

Description: This paper attempts to advance practice and methodology with respect to life insurance company valuation. From Society of Actuaries Financial Reporting Monograph, M-AS99-1.

Description: Full version of Risks and Rewards Newsletter, March 1999, Issue No. 32.

Description: Review of the address given by Richard H. Thaler, Robert P. Gwinn Professor of Behavioral Science and Economics at the University of Chicago at the Investment Section at the Society of Actuaries meeting in New York on October 20.

Description: Full version of Risks and Rewards Newsletter, February 2001, Issue No. 36.

Description: The author notes that “current market value is highly relevant, but its accuracy is limited. Historical accounting, on the other hand, is highly accurate, but is of little relevance.” The article then goes on to discuss two leading methods for performing fair valuation of liabilities: the actuarial appraisal method and the option pricing method, and how they can be reconciled.

Description: The article discusses under which conditions it is appropriate to use the true probability distribution or the risk-neutral probability distribution for interest rate scenario generation. It addresses which should be used for valuation purposes and strategy development.