Capital and Surplus Relief (E) Working Group
Capital and Surplus Relief (E) Working Group Page
Joint Executive (EX) / Plenary Committee Summary Report
Summer 2009 Meeting Summaries Index
The Capital and Surplus Relief Working Group of the Financial Condition (E) Committee met June 13, 2009.
During this meeting, the Working Group:
- Received progress reports from technical groups regarding its Work Plan:
- The chair of the Life and Health Actuarial Task Force reported that proposals Life 1a, Life 1c and Life 2 have been adopted and advanced to the Life Insurance and Annuities (A) Committee. These proposals include changes to Actuarial Guideline 1C, as well as three model regulations:
- Model Regulation Permitting the Recognition of Preferred Mortality Tables for Use in Determining Minimum Reserve Liabilities (#815)
- Actuarial Opinion and Memorandum Regulation (#822)
- Valuation of Life Insurance Policies Model Regulation (#830)
The Work Plan calls for these three proposals to be considered by the Executive (EX) Committee and Plenary during the Summer National Meeting.
- District of Columbia Insurance Commissioner Thomas E. Hampton reported on the Reinsurance Task Force’s actions regarding the Life 3 proposal, indicating that the Task Force would consider adoption of the guidance memo in its June 13 afternoon meeting, but would exclude the model bulletin because no changes, additions or deletions of regulatory requirements were included in the guidance memo’s response to this proposal. The Capital and Surplus Relief Working Group adopted a proposal to delete the model bulletin action item included in its Work Plan.
- The chair of the Life Risk-Based Capital Working Group reported on the Variable Annuity 2 and Investment 1 proposals. Regarding the Variable Annuity 2 proposal, the C-3 Phase II Subgroup will be reviewing reports on 2008 C-3 Phase II results that are due later this month. The Investment 1 proposal has two tracks: 1) a permanent solution proposal being developed by the American Council of Life Insurers; and 2) a 2009 interim solution that narrows the possible ranges for the 2009 mortgage experience adjustment factor (MEAF) that will be considered by the Capital Adequacy Task Force on June 14.
- The vice chair of the Statutory Accounting Principles Working Group reported that the Working Group will consider deferred tax assets during its June 13 meeting, but will likely defer the item until the Fall National Meeting to allow for an interested party presentation on the subject. The Statutory Accounting Principles Working Group still plans to have a final determination by the end of 2009 as expected by the Capital and Surplus Relief Working Group’s Work Plan.
- Adopted a referral to the Accounting Practices and Procedures (E) Task Force to consider:
- How to ensure that regulators are providing the minimum information on permitted-practice requests, as specified in the Preamble of the Accounting Practices and Procedures Manual.
- The need to track the number of requests asked of states.
- The best way to handle differences of opinion on permitted-practices requests between domiciliary and non-domiciliary regulators.
- Planned for a call to discuss the charge regarding an NAIC emergency procedure. The chair asked members to consider two main questions:
- What indicator(s) would trigger an emergency procedure?
- What should the emergency procedure entail?
Action Items:
- Adopted a proposal to delete the model bulletin action item for proposal Life 3 from the Work Plan.
- Adopted a referral to the Accounting Practices and Procedures (E) Task Force regarding the Working Group’s charge regarding permitted practices.
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