Regulators at the National Association of Insurance Commissioners and outside actuaries are starting to decide how to apply the flexible, principles-based approach to actuarial work to a new life policy Standard Valuation Law.
Larry Bruning, a Kansas regulator who is leading efforts by the NAIC’s SVL II panel to change the law, says the work involves seeking answers to a number of basic questions, including:
- What is the purpose of the revised law?
- Who will monitor compliance?
- What will the remedies be for cases of noncompliance?
- Will there be peer review of actuaries’ work?
- Will any regulatory reviews that occur take place in the state of domicile or the state of filing?
The effort eventually could lead to changes in the rules for health reserves as well as life reserves, according to Bill Weller, a health actuary.
“It does seem that if there is going to be a valuation manual, that there may need to be consideration over how to deal with life-like health lines, long term care and [disability insurance] in particular,” Weller says.