Regulators are talking about the standards that ought to apply to the new valuation manual.
The manual is supposed to come out sometime this year along with an upcoming update of the National Association of Insurance Commissioners’ Standard Valuation Law model.
Members of the American Academy of Actuaries, Washington, are working on a draft of the manual together with members of a subgroup of the Life and Health Actuarial Task Force at the NAIC, Kansas City, Mo.
One question for LHATF members is whether the valuation manual has to be complete or nearly complete when the amended SVL model comes out, or whether regulators can start with a bare-bones manual and flesh it out over time.
Regulators from Kentucky say they need a “fairly complete” version of the manual to get the SVL model through their legislature.
Regulators from Florida say the manual authors could complete instructions for one product line, then use the completed section to guide work on additions relating to other product lines.
Katie Campbell, an Alaska regulator, says the SVL manual language ought to be flexible enough so that regulators will not have to go back to their legislatures every time the NAIC added a standard to the SVL manual.
Similarly, LHATF subgroup members are still debating how flexible the underlying SVL model ought to be.
Meanwhile, subgroup members are postponing discussions about when exactly the valuation manual will take effect, in part because commissioners are deciding whether to set a two-thirds majority requirement for NAIC adoption of NAIC models.
NAIC leaders have proposed an increase to a two-thirds majority standard, from a majority standard, in light of an analysis showing that only 3 or 36 NAIC models adopted since 1996 have been enacted in more than 26 states.