Description: The paper explores developments through 2006 in the application of market-consistent concepts to the measurement of fair values of liabilities for financial reporting purposes. A set of criteria is presented that should be useful in the evaluation of proposed fair value measurement approaches where inputs based on prices observed in an active market with reliable transaction prices are not available. Based on these criteria, one approach is examined that might serve as a basis for the fair value measurement of the liability of life insurance contracts and other financial instruments issued by insurers.

Description: VM-20 requires prudent estimate assumptions that are based upon a combination of company experience, industry basic tables and prescribed margins. VM-20 has requirements on how company experience is defined, and also requires that additional margins be established if the actuary does not consider the prescribed margins to be adequate.

Description: Presents a practical solution to some of the distortion caused by a typical application of the retrospective assumption update (unlocking) method.

Description: Illustrates the effects of different approaches to updating GAAP valuation assumptions for traditional life contracts.

Description: Development of relevant industry mortality experience for different market segments. Details about the 2017 CSGI Mortality Table for guaranteed issue products.

Description: Section 818c of the Life Insurance Company Income Tax Act of 1959 provides, for companies holding other than net level premium reserves, a choice of two methods: exact revaluation or approximate revaluation to this basis. This paper discusses the impact of the choice on the level of a company's tax reserves. A discussion paper follows.

Description: Under non-Aristotelian logic, there are multiple values, or shades of gray. Indeed, there may even be unexpected results from logical combinations, like “both” and “neither.” This article discusses how this insight should be applied to the current debate between formula-driven reserves with limited assumption flexibility and the reserve principles approach. For reserve standards, we do need both actuarial judgment grounded in reserving principles and restrictive formula methods or safe harbors.

Description: This article discusses a number of product variations seen in the market with respect to Universal Life products with secondary death benefit guarantees, factors leading to those designs and considerations regarding the adequacy of reserves that emerge under AXXX formulas. This article also identifies a series of factors that authors believe will make it difficult to quickly and equitably resolve these issues through formula-based changes.

Description: Compares Term VM-20 modeled reserves at low credibility factors.