Financial Standards and Accreditation (F) Committee
September 29, 2007

The Financial Regulation Standards and Accreditation (F) Committee met on Saturday, Sept. 29, 2007. During this meeting, the Committee:

• Discussed and voted to adopt its 2008 proposed charges.

• Heard a report from a subgroup that was charged with considering a referral received by the Committee from the Financial Examination Modernization (E) Working Group. This referral contained recommendations from the Working Group that addressed three key issues impacting financial condition examinations and the accreditation standards. The subgroup provided recommendations on what action it suggested the Committee should take on each item and the Committee voted to adopt each of the subgroup’s respective recommendations. The action taken by the Committee on each of the items was as follows: 1) adopted the proposed revisions to the review team guidelines regarding redomesticated companies, effective Jan. 1, 2008; 2) adopted proposed possible exceptions to the 18-month timeliness requirement as an additional accreditation interlineation (this also included adding minor language to the review team guidelines), effective Jan. 1, 2008; and 3) adopted proposed revisions to the review team guidelines regarding review and reliance on a lead-state’s workpapers effective Jan. 1, 2008, and referred the language to the Financial Examiners Handbook (E) Technical Group for their consideration of the language.

• Heard a report from the same subgroup noted above that was also charged with considering comments received related to risk-focused examinations, including proposed revisions to the NAIC Financial Condition Examiners Handbook (the Examiners Handbook) and the review team guidelines. The subgroup noted that due to the technicality of some of the comments received, further consideration of the comments and related proposed revisions was referred to the Risk Assessment (E) Working Group with a response requested from that group no later than Oct. 31, 2007.

Action Items :

• Voted to adopt its 2008 proposed charges.

• Voted to adopt proposed revisions to the review team guidelines effective Jan. 1, 2008, related to three key issues impacting financial condition examinations and the accreditation standards. These issues were considered by a subgroup of the Committee that was formed after the Summer National Meeting and charged with addressing a referral received by the Committee from the Financial Examination Modernization (E) Working Group (the Working Group). The proposed revisions from the Working Group’s referral were modified slightly by the subgroup and related to: 1) examinations of redomesticated companies; 2) possible exceptions to the 18-month timeliness requirement; and review and reliance on lead-state workpapers. The Committee also voted to adopt the scenarios regarding possible exceptions to the 18-month timeliness guideline proposed by the Working Group as an additional accreditation interlineation. In addition, the Committee voted to refer the adopted revisions to the review team guidelines regarding review and reliance on a lead-state’s workpapers to the Financial Examiners Handbook (E) Technical Group for their consideration of the language into the Examiners Handbook.