Should actuaries develop an interim mortality table for preferred life insurance products or split the existing life mortality table into preferred and non-preferred tables?
Members of the Life & Health Actuarial Task Force at the National Association of Insurance Commissioners, Kansas City, Mo., are considering that question as they work on a proposed model regulation that would permit recognition of preferred mortality tables for use in determining minimum reserve liabilities.
The American Academy of Actuaries, Washington, and the Society of Actuaries, Schaumburg, Ill., are working on an interim preferred mortality table, and there are also plans to develop a new, permanent mortality table.
The American Council of Life Insurers, Washington, is asking actuaries to use an existing table as the basis for a new preferred/non-preferred split table.
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The ACLI is promoting the creation of the split table as an alternative to the development of an interim table.
Instead of developing an interim table, actuaries should focus on developing a new permanent table that will incorporate a principles-based approach to reserving, the ACLI says.
The ACLI made the request Monday during an LHATF session.
The ACLI is recommending that the AAA be asked to develop a practice note to cover this topic and that the Actuarial Standards Board be asked to expand the scope of Actuarial Standard of Practice Number 40.
The draft regulation would refer to the practice note and the ASOP, and they would pave the way for the use of existing mortality data.
The LHATF is establishing a subgroup that will try to get ready to expose the draft actuarial guideline for public comment in early August.