Life and Health Actuarial Task Force
September 28 - 29, 2007

The L ife and Health Actuarial Task Force met on Friday and Saturday, September 28 th and 29 th, 2007.

During this meeting, the Life and Health Actuarial Task Force:

• Expanded the charge to the Statistical Agent Subgroup to encompass PBR in its recommendations
• Requested the AAA recommend an appropriate mortality table or tables for pre-need, guaranteed issue and simplified underwriting life insurance
• Developed proposed charges for LHATF for 2008
• Continued to work on various projects related to conversion to a principles-based system:
• The development of revisions to the Standard Valuation Law to enable principles-based reserves,
• The development of a valuation manual and
• Assignment of subgroups to work on various pieces of the valuation manual and then have the entire Task Force work on it at the 2007 Winter National Meeting.
• Discussed possible revisions to a new proposed actuarial guideline for establishing reserves for variable annuities (AG VACARVM)
• Discussed possible revision to AG XXV to address the effects of inflation on policy face amounts
• Discussed the idea of segregating pre-need business as a separate line due to differing policy structure, marketing, mortality and other experience
• Received reports from the following, which were primarily related to implementing a principles-based valuation system:

• Various AAA work groups related to a principles-based system

• Life Reserves Work Group
• Annuity Reserves Work Group
• Valuation Manual Work Group
• Survey of products to be included in PBR
• Survey of low risk, small company issues
• Credit and other non-PBR requirements
• Reporting and independent review
• Reinsurance
• Preferred Mortality Project Oversight Group (joint SOA/AAA)
• Group Term Life Waiver of Premium Valuation Tables
• Nonforfeiture Improvement

• Status reports from SOA teams

• Data valuation
• Experience analysis
• Underwriting criteria
• Pre-need mortality

• LHATF SVL-2 Subgroup
• LHATF AG VACARVM Subgroup
• LHATF Accident and Health Working Group
• LHATF Risk Assessment Training Subgroup
• LHATF Statistical Agent Subgroup

• Received comments from industry representatives relative to:
• AG VACARVM
• SVL-II and the Valuation Manual
• Proposed Pre-need Mortality Model Regulation
• The statistical agent for Model Regulation 815 and for Principles-Based Reserves
• Exposed for comment:
• A revision of AG XXXIX to extend the guideline until a risk-focused valuation method is developed and to systematically release some of the excess reserves held
• A revision of proposed AG VACARVM including technical corrections proposed by the AAA
• A revision of the proposed Model Regulation for Mortality Assumptions for Pre-need Insurance
• A proposed revision of the SVL to effect principles-based reserve methodology
• A revision of the Valuation Manual

Action Items:

Voted to have current LHATF members and existing subgroups of LHATF to continue working on Task Force assignments during the period between the election of NAIC officers and the appointment of LHATF by the Executive Committee and the subsequent appointment of subgroups.