Description: The article discusses how strategic planning and strategic risk management are intertwined.

Description: How does mortality experience impact earnings under the new GAAP financial framework? This article discusses how to isolate key components from financial models related to decrements, as well as how to handle the changes in the financial reporting landscape including: the aggregation of insurance policies into cohorts, dynamic reserving, and the limitations imposed by caps and floors. Looking at the components of earnings, such as the present value of benefits, expenses, and premiums, and how these elements interact is critical to form a comprehensive earnings story.

Description: This article aims to delve into the rationale and calculation logic of the variable fee approach (VFA) which is applied to the insurance contracts with direct participation features under IFRS 17. In actual practice, the variable fee approach can be implemented in two methods, which are from fee income or total cash flows point of view. These two methods will achieve the same outcomes but are featured with different insights and varying degree of operational ease. Detailed roll-forward steps of contractual service margin (CSM) for these two methods are elaborated in the article, along with a numerical example by using a variable universal life product to help the readers comprehend the rationale behind the variable fee approach.

Description: There will be inflection points in the value of an instrument when interest rates change. These inflection points could materially impact the approximation of value change using ALM metrics. In this part of the seven-part series, I will highlight: • How to identify the inflection points; • the range of rate changes where ALM metrics may be relied upon i.e., the “validity” range, outside of which recalculation of the ALM metrics is required and the potential that one needs to rebalance the portfolio; • a technique to improve on the approximation of value change beyond the validity range; and • a technique to convert non-linear change on the yield curve to be used with duration and convexity.

Description: Presents a step-by-step methodology for calculating confidence intervals for IBNR estimates derived using the Averaqe PMPM method. It is a companion article to the January 2023 Health Watch article presenting the Average PMPM method for generating point estimates of IBNR with zero claims runout.

Description: Cost sharing reduction (CSR) payments are offered to low-income individual insurance buyers under the ACA. After October 2017, the difference in costs between the standard silver plan and CSR variants were defunded. To cover the costs of defunding, insurers have increased rates either through "broad loading" or "silver loading." States are approaching this adjustment differently, which is leading to some interesting differences between states. This article will review these differences.