Invested Assets Working Group
Financial Condition (E) Committee
Valuation of Securities Task Force

The Invested Asset (E) Working Group of the Valuation of Securities (E) Task Force (IAWG) is the NAIC group responsible for providing technical analysis and recommendations on the appropriate regulatory response to risks in investments eligible for purchase by insurers. As such, it serves as the contact point for guidance to the industry, their investment advisors and capital market participants generally on regulatory concerns associated with investments insurers may purchase. The IAWG is also responsible for assessing the adequacy of the regulatory framework (i.e., reporting, accounting, risk-based capital and other similar mechanisms) for investments and making appropriate recommendations to other NAIC groups. The primary objective of the IAWG is to identify and articulate regulatory perception of risks in investment securities to insurance companies and their investment advisors to help ensure that insurance company investment decisions incorporate an understanding of potential regulatory responses to investment risks in investments. This charge is given to the IAWG as one way for the NAIC to mitigate the risk of confusion about regulatory policy for investments that may disrupt capital markets.

The following documents provide guidance about the IAWG its relationship to the Valuation of Securities Task Force and the broader NAIC process and the Securities Valuation Office. The following documents also identify how an interested person seeks guidance from the NAIC on potential regulatory concerns with investment risk in investments.

• Policy Statement
• Risk Assessment Worksheet
• Explanation of the Role and Function of the SVO in the Formulation of Policy for Insurer Investments
• How to Obtain an SVO Assessment of the NAIC Regulatory Treatment for an Investment
  • RTAS Application
• NAIC Procedure for Placing a Security under Regulatory Review
• Explanation of the NAIC Process for Coordinating Regulatory Expertise when a Security is Placed under Regulatory Review

2009 Charges

1. From time to time, the Valuation of Securities (E) Task Force may determine that the technical nature of some matter before it would be best advanced by convening the Invested Asset Working Group and transferring to it a specific regulatory assignment or assignments. The assignment or assignments thus transferred to the Invested Asset Working Group by the Valuation of Securities Task Force shall be within that charge of the Task Force related to development of a regulatory framework for new or evolving investments or the consideration of refinements for an existing regulatory framework applicable to an existing class of securities. The phrase regulatory framework refers collectively to and means the following regulatory mechanisms or processes: statutory accounting guidance, annual statement instructions, blanks reporting instructions, asset valuation reserves, interest maintenance reserves, risk based capital charges, valuation procedures for invested assets, credit assessment procedures for invested assets or any other aspect of the NAIC financial solvency framework within the scope of the charge of the Task Force. The Invested Asset Working Group is charged with the review of matters in the priority established by the Task Force. (Charge adopted December 10, 2006.)
2. The Invested Asset Working Group is charged with considering improvements to the process by which risks in new invested assets are evaluated, communicated and monitored, and how the annual statement investment schedules could be made more transparent to better reflect non-credit risks, such as various structural risks embedded in new and existing securities. (Charge adopted June 3, 2007.)