Description: This article provides a short history of the correction procedures previously developed to address compliance failures and the shortcomings of those procedures under sections 101f and 7702, laying the foundation for a sea change in the correction process.

Description: Recently, there has been an increase in the product development of simplified issue products in the United States. In the past two years, Gen Re LifeHealth has reviewed over 40 such products, ranging from vanilla direct-marketed products to high-end single premium immediate annuity SPIA paid universal life products. From Small Talk Newsletter, June 2005, Issue No. 24.

Description: ASU 2018-12 introduced a new concept called “market risk benefits” (MRBs). MRBs are a new accounting classification for benefits within deposit contracts, offering protection from “other than nominal market risk.” This applies to products with account values, including variable and indexed annuities with guaranteed living or death benefits attached (aka GMxBs). ASU 2018-12 Section 944-40-30-19D mentions both a non-option and an option-based valuation approach to account for MRBs. This article considers the option-based approach. The purpose is to highlight weaknesses in the current application of the option approach to MRBs, propose an alternative method, and consider the benefits of the new approach. The intent of this article is to persuade practictioners / actuaries / accountants that this is a better approach for applying the fair value option method to market risk benefits.

Description: Provide high level summary of changes to Valuation Rates for Payout Annuities and similar contracts.