December 2018

Revisions to the SOA’s GI Textbooks

By Anthony Cappelletti and Scott Lennox

The SOA’s textbook Fundamentals of General Insurance Actuarial Analysis by Jacqueline Friedland was originally written and published in 2013. This textbook is the main syllabus resource for the General Insurance Ratemaking and Reserving (GI-RR) exam. The textbook is a comprehensive treatment of the fundamentals that GI actuaries need to know pertaining to reserving and ratemaking. The main textbook contains 36 chapters divided into the following eight sections:

  • Part 1—Introduction
  • Part 2—Key Concepts
  • Part 3—Preparing the Data
  • Part 4—Basic Methods for Estimating Ultimate Claims
  • Part 5—Financial Reporting
  • Part 6—Trending Procedures and Calculating Trend Factors for Claims and Exposures
  • Part 7—Ratemaking
  • Part 8—Monitoring Results

The appendix volume of the textbook contains detailed calculations of the six companies that support the main part of the text.

While the fundamental techniques used by GI actuaries remain consistent, it was anticipated that occasional updates would be needed to keep the references current and continue to reflect the fundamental techniques used in practice. A second edition of the textbook is being worked on and will be completed in 2019. The following is an overview of the revisions anticipated for the second edition:

  • Updated references.
  • Enhanced coverage of the pace of IT changes and implications (e.g., reflecting new types of products).
  • Enhanced coverage of reinsurance for GI actuaries, including reinsurance collectability and reserving for assumed versus primary.
  • Enhanced coverage of data reconciliations, including the types of things that appointed actuaries should do, auditor relationship, and pricing to reserving reconciliations.
  • Enhanced coverage of internal and external influences.
  • Updates to reflect various policy changes that have been happening (e.g., how the industry is addressing the sharing economy, InsurTechs, etc.).

Some of the planned changes to the second edition of the Friedland text are inspired by the NAIC Standards and Assessment Project list of knowledge statements.

The SOA’s textbook General Insurance Financial Reporting Topics, edited by SOA staff fellow Anthony Cappelletti, was initially published in 2013. This textbook requires relatively frequent updates due to changes in financial reporting standards, tax laws, regulations, rating agency models and actuarial standards/guidance. It is one of the main syllabus resources for the General Insurance—Financial and Regulatory Environment Exam, U.S. version (GI-FREU).

The chapters of the textbook are as follows:

  • Accounting Concepts for General Insurance
  • Accounting for Insurance Contracts
  • Accounting for Financial Instruments
  • Accounting for Reinsurance Contracts
  • Accounting Perspectives for Nonadmitted Assets
  • Schedule F, Statutory Credit for Reinsurance
  • Schedule P, Statutory Loss Accounting
  • Notes to Financial Statements
  • Measuring Total Income by Line of Business
  • Returns on Capital: Planning, Pricing and Performance
  • Measuring Insurer Financial Strength
  • Solvency Monitoring
  • General Insurance Financial Ratings
  • Overview of the General Insurance Statement of Actuarial Opinion
  • Federal Income Taxes for General Insurers

It should be noted that the first edition was a collection of papers. Many of the changes to the text have been made to transition it from a collection of papers to a single cohesive textbook. Each update provides an opportunity to improve the organization of material, remove redundancies, update references and correct any errors. The following outlines the history of editions.

Edition Publication Page Count GI-FREU Syllabus
1st In stages, from December 2013 to February 2014.


(+ 23 for Ch. 11 substitute)

Spring 2014 and Fall 2014
2nd January 2015 634 pages Spring 2015 to Fall 2016.
3rd December 2016 541 pages Spring 2017 to Fall 2018
4th December 2018 or January 2019

493 pages

(dependent on final edits)

Spring 2019 to TBD

The fourth edition underwent a considerable amount of editing. Revisions included:

  • Correcting errors that were in the third edition.
  • Reducing repetitive text.
  • Reducing footnotes.
  • Deleting unnecessary/irrelevant text.
  • Re-structuring and re-writing much of Chapters 1 and 2 to improve clarity and flow.
  • Re-structuring and re-writing some sections of Chapters 3 to 15 to improve clarity.
  • Updating references to 2017.
  • Adding new sections on topics such as: IFRS 17, novations and the 2018 changes to Schedule F.
  • Updating the section on NAIC RBC to include catastrophe risk charges.
  • Updating the section on rating agency capital models to reflect more recent information.
  • Increasing the depth and breadth of Chapter 14.
  • Updating Chapter 15 to include the 2017 reforms of U.S. tax law.

Some of the changes included in the fourth edition were inspired by the NAIC Educational Standards and Assessment Project list of knowledge statements.

Anthony Cappelletti, FSA, FCIA, FCAS, is a staff fellow for the SOA. He can be contacted at .

Scott Lennox, FSA, FCIA, FCAS, is a staff fellow for the SOA. He can be contacted at