The SOA At Work
The SOA at Work
The SOA is an organization devoted to advancing the frontiers of actuarial practice through our research and the development of new intellectual capital for the profession. This edition of The SOA at Work highlights two important initiatives that contribute to that mission. The first relates to the upcoming release of our full report on the 2007 Retirement 20/20 Conference. Retirement 20/20 is a pioneering effort by the actuarial profession to help frame the terms of a vital discussion society needs to have about the future of retirement. In addition to offering critical ideas and insights, the effort also demonstrates the contributions actuaries can (and do) make to solving complex, real-world problems. The second initiative is our plan to sponsor two new studies intended to provide data needed by actuaries for principle-based reserving. The SOA is committed to using our research efforts to provide actuaries with tools needed to respond to changing practice and regulation–this is an important example of our commitment.
I urge interested members to follow and to read the results of these important reports and studies and, of course, to let the SOA know of additional issues you feel need further research or debate.–SOA Executive Director Greg Heidrich
Retirement 20/20 Conference Report to be Released
A full report on the 2007 Retirement 20/20 Conference, "Aligning Roles with Skills," is expected to be released this quarter. The report will reveal results of debates around how best to design roles for three key stakeholders–society, markets and employers–in 21st century retirement systems.
Conference attendees broke into groups, debated the issues and came to a few conclusions:
- Society should encourage lifetime income, take an active role in helping individuals accumulate funds for retirement and be responsible for setting rules and regulations as well as overseeing the system.
- Markets need to be structured to both encourage some standardization of products (so consumers can comparison shop) but yet not hamper innovation.
- The role of the employer should be very different from how it is today and should possibly include the role of facilitator, educator/trusted advisor and other elective roles such as purchasing agent, distributor of income and guarantor.
Almost 70 participants from the United States and Canada met at the conference in Washington, D.C. in September 2007. Read a short summary of the conference at Retirement2020.soa.org. The full report will also be posted at this Web site.
SOA Ready to Launch Research Needed for Principle-Based Reserving
The SOA plans to sponsor two new studies–both to begin this year–which will provide important data needed by life insurance companies that may ultimately use principle-based reserving. One study will focus on assumption margins that reflect the degree of uncertainty for selected risk factors such as mortality, lapse, expense, default cost, etc. The other research project will model the impact of the transition on companies from calculating reserves using the current statutory formulas to calculating reserves using a principle-based approach.
The studies' results are expected to be released by early 2009 and are just one part of the SOA's efforts to assist in the development of principle-based reserving methods. This follows the work that has already been done in creating the Preferred Mortality Study, which segmented experience data in more detail than past mortality studies did.
The SOA is collaborating with the Life and Health Actuarial Task Force of the National Association of Insurance Commissioners (NAIC) and the Life Practice Council of the American Academy of Actuaries to determine the appropriate research that is needed, identify the key issues and assess the overall direction, goals and timelines of principle-based reserving methods. In addition, the SOA is planning to create basic and continuing education initiatives that will capture all the fundamentals in the transition to a principle-based approach.
The Board of Directors will be sharing a draft version of the SOA's new strategic plan for a comment period. Look for more information on this exciting initiative in the coming weeks!
Life Spring Meeting
US GAAP for International Life Insurers
US GAAP for International Life Insurers
Health Pricing and Valuation Boot Camps
43rd Actuarial Research Conference
Regina, SK, Canada