Description: Risk adjustment is needed under IFRS 17 to reflect the compensation that a company requires for bearing the uncertainty about the amount and timing of the cash flows that arises from non-financial risk. Companies are also required to disclose the method and confidence level used for the calculation of the RA. However, IFRS 17 doesn’t specify a method and a confidence level, nor does it provide a list of specific risks that are considered to be non-financial risk. Companies need to define them based on their own preferences or existing practices. This article will introduce available approaches and discuss the confidence level approach with potential consideration stemming from industry preferences and illustrative examples.

Description: Discussion of the increased use of reinsurance in the life insurance industry, including the causes and implications

Description: This article summarizes five key lessons we have learned in implementing LDTI and shares our insights on practical ways to address them. This is not an exhaustive list of implementation challenges, but companies that can successfully tackle the issues we describe should have a smoother data and systems implementation transition.

Description: History of Life Insurance insolvencies and evolution of statutory reporting requirements and laws to enable improved control over preventing insolvencies. Reflects my extensive personal knowledge serving on regulatory and industry boards and committees regarding these developments. A key item of solvency control in Risk Based Capital. References provided for FRBC/insolvency data from NAIC and the GAO.

Description: This article helps companies better understand the currently proposed upcoming VM-22 regulation by comparing the VM-22 measurement model to LDTI MRBs. The article highlights key considerations as companies plan for adoption of these two measurement models. These considerations should help inform a company’s strategy related to the business impacted by these standards.

Description: Discussion of the investigation of the Faculty and Institute of Actuaries in the United Kingdom relating to the events surrounding the closure to new business on December 8, 2000 of the UK’s Equitable Life Assurance Society.

Description: This article provides a summary of the research paper and Excel-based tool that can be found on the SOA’s website at Regulatory Capital Adequacy for Life Insurance Companies: A Comparison of Four Jurisdictions | SOA.

Description: The SOA textbook related to US GAAP for insurers has been updated. It incorporates the recent GAAP changes, including Long Duration Targeted Improvements, and now covers both life and non-life insurers. This is an essential updated for anyone working with US GAAP financial statements, whether you are an actuary or other finance professional.

Description: Mandatory implementation of life principle-based reserves (PBR) is just around the corner, and there is no shortage of work to do, as most products have yet to be moved to PBR. Oliver Wyman recently completed its 2019 PBR survey, with more than 40 participants covering 85 percent of the individual life market, including 23 of the top 25 life writers and five reinsurers. This article will expand on the key survey findings including implementation status and model simplifications.

Description: This article reviews why financial reporting controls are relevant to actuaries. It also discusses the impact of LDTI on controls and the strategic decisions that insurers need to make.