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December 16, 2005 at 07:00 PM
The National Association of Insurance Commissioners may need a reserve valuation office that would be similar to the NAIC’s securities valuation office.[@@]
Larry Bruning, chief actuary with the Kansas Insurance Department, and other speakers discussed that possibility during a recent Webcast sponsored by the Affordable Life Insurance Alliance, Washington, that focused on the concept of “principles-based” reserving.
The NAIC, Kansas City, Mo., and the American Academy of Actuaries, Washington, have been working on principles-based reserving efforts that could end up reducing the industry’s reliance on static formulas for setting minimum reserve levels. Instead, insurers and regulators would rely on actuaries’ judgment and use of statistical forecasting techniques.
In addition to the “RVO” proposal, Webcast participants talked about the possibility of using the current individual state filing system for actuarial attestations and a “state of domicile” approach, which would require insurers to file reserve valuation information with their home state insurance departments.
