Description: A pension actuary and a life actuary collaborate to express public pension liability and asset issues in terms and figures that an insurer would use

Description: VM-22 was first introduced into the Valuation Manual in 2018. A number of changes have been made since its introduction, with more expected on the way. This article compares valuation requirements for income annuities pre- and post-VM-22, discusses technical and implementation implications with regards to VM-22 (including comparison with New York Regulation 213), and considers future revisions.

Description: This article discusses the need for more coordination and consistency in assumption setting between the pricing actuary, illustration actuary, appointed actuary, and financial reporting actuary.

Description: This article provides the reader with some insights regarding tax planning under the new required methodology.

Description: An overview of the NAIC Variable Annuity Reforms, including a discussion of perceived positives and challenges associated with the reforms.

Description: This article analyzes two common interpretations of SOP 03-1 in determining the guaranteed minimum death benefit GMDB liability in a variable annuity contract, and it analyzes the resulting impact on the initial GMDB reserve and on the volatility of GAAP earnings as actual experience emerges. This analysis could be applied to the guaranteed minimum income benefit GMIB, guaranteed minimum accumulation benefit GMAB, guaranteed minimum withdrawal benefit GMWB and other guaranteed benefits in a variable annuity contract that are subject to SOP 03-1, and the conclusions would be similar.

Description: This article summarizes the key changes to VM-31 requirements in the 2020 version of the Valuation Manual for both life and variable annuities, and compares and contrasts the requirements for each. In addition, the article offers insights into common issues and recommendations for VM-31 reports from the viewpoints of a regulator, consultant, and company actuary.

Description: The article described two methods for calculating the benefit ratio described in AICPA Standard of Practice SOP 03-1. Method 1 calculates the benefit ratio as the quotient of the expectation of A and the expectation of B where A is benefits and B is assessments. Method 2 calculates the benefit ratio as the expectation of the quotient of A and B.

Description: New York’s Regulation 126 effectively requires all companies doing business in New York to file an actuarial opinion and memorandum on their annuity and GIC business. This article attempts to answer 13 of the most commonly asked questions about this regulation.

Description: Accounting Standards Update (ASU) 2018-12, commonly referred to as long duration targeted improvements (LDTI), is the most significant GAAP accounting change impacting the life insurance industry in the past 40 years. This article discusses the impact of LDTI on variable annuities (VA) and fixed indexed annuities (FIA) from a product development and in-force management angle. Detailed discussion topics include hedging and ALM, product strategy and development, and pricing. LDTI will cause many VA and FIA writers to re-evaluate their hedging and asset liability management (ALM) strategy following the move to fair value accounting under the new MRB requirement. Stakeholder appetite for accounting volatility and resulting changes to hedging and ALM may trigger changes in product mix and designs. In addition to updating pricing infrastructure to handle the new requirements, pricing actuaries will need to produce analyses to educate stakeholders on the risks and pricing implications of any changes to designs, hedging and ALM.