Description: Economic capital is everywhere you look in the insurance industry these days. Article explains reasons for this and discusses recent developments and the impact on the financial reporting actuary.

Description: Performance measurement is not the primary purpose of either GAAP or statutory accounting. This article discusses alternative methods of reporting used by life insurance companies to better measure financial performance.

Description: Businesses across the board have been drastically impacted by the effects of COVID-19 over the course of 2020, and insurance was not immune. Perhaps most relevant to this industry’s current capital and liquidity concern is the prevailing low interest rate environment. This has been a global trend in the last decade, and treasury rates in much of the developed world are at or near zero. Reduced investment returns limit an insurer’s ability to achieve their desired return on equity, eliminating previously profitable strategies that depended on the leverage of life and annuity balance sheets. Focus and activity have instead shifted to other methods to counteract the low interest rate markets and accompanying capital strain. Examples include increased mergers and acquisitions (M&A) activity within the insurance industry and an increasing focus by private equity firms in the insurance market for asset-intensive products, both of which reflect the goal of increasing yield rates on capital.

Description: Article discusses the measurement objectives being considered by the FASB and IASB joint project to produce a new accounting standard for insurance contracts.

Description: Feature article discussing the number of challenges associated with ASU 2018-12 related to the measurement of market risk benefits.

Description: Measurement of the Volatility Risk of Traditional Actuarial Risks for use in pricing and reserving

Description: This article is an update, as of May 2021, on Financial Reporting Section sponsored projects in process and those recently completed

Description: The article summarizes implications of rising interest rates on U.S. GAAP and statutory financial reporting for life insurers, highlighting potential tailwinds from steady increases and headwinds from sharp increases. We further provide insights into how insurers can leverage ALM programs and interest rate risk hedging practices to favorably position themselves in a rising rate environment

Description: Cautions against putting too much faith in financial models - such as the IASB's proposal to accrue future expected profits on the day a policy is issued.

Description: This article provides an EV overview, current industry usage, key considerations illustrated by MetLife’s strategic spin-off of Brighthouse Financial, as well as implementation notes.