By Stuart Klugman
On Sept. 2, 2020, the American Academy of Actuaries released an exposure draft of revisions to the U.S. Qualification Standards. Several improvements are being proposed, but one in particular is relevant for general insurance actuaries. Per the background in that draft, “During 2019, the NAIC amended the instructions and definitions related to the qualifications for an Appointed Actuary signing Statements of Actuarial Opinion for Property and Casualty Annual Statements to reflect the addition of the Society of Actuaries specialty track in general insurance.” The Academy then used this opportunity to make other changes and clarifications.
As a reminder, SOA fellows who completed the general insurance track have always satisfied the General Qualification Standard regarding being able to practice in the U.S.
Regarding the Specific Qualification Standards, the proposed revised language is in Section 3.1.1.2:
"Statement of Actuarial Opinion, NAIC Property and Casualty Annual Statement—An actuary should successfully complete relevant examinations administered by the American Academy of Actuaries, the Casualty Actuarial Society, or the Society of Actuaries on the following topics: (a) policy forms and coverages, underwriting, and marketing, (b) principles of ratemaking, (c) statutory insurance accounting and expense analysis, (d) premium, loss, and expense reserves, and (e) reinsurance."
The only change is to add the Society of Actuaries to the list of approved organizations.
While the standard does not define the relevant examinations, recall that the NAIC’s instructions state that a fellow must have passed the Introduction to General Insurance, Ratemaking and Reserving, Financial and Regulatory Environment (U.S.), and Advanced Topics in General Insurance exams.
The Academy opened a comment period that ended on Oct. 30, 2020. No timeline was provided for the next steps in the process. One hundred fifty-one comments were received. Only two addressed the change to Section 3.1.1.2 and were both supportive and appreciative (from SOA President-elect at the time Roy Goldman and from President Andy Rallis on behalf of the SOA).
The vast majority of comments were in support (with a very small number of dissenters) of incorporating continuing education on diversity, equity, and inclusion into the professional development requirements. Given the strong support for this as well as objections to some of the revised wording in other sections, it seems likely there will be a second exposure draft.
This is viewed as the final major step in gaining regulatory approval in the United States. Our continued thanks for all who worked to achieve this end.
Stuart Klugman, FSA, CERA, is senior staff fellow, Education at the Society of Actuaries. He can be reached at sklugman@soa.org.