Regulators are continuing to talk about developing a system that would gather life insurance mortality data.
Members of the “statistical agent” subgroup, an arm of the Life and Health Actuarial Task Force at the National Association of Insurance Commissioners, Kansas City, Mo., say the statistical agent system might gather experience data that regulators could use to detect trends and compare individual valuation data with industry data.
Regulators say they wished they had more data today to evaluate insurers using the 2001 Commissioners Standard Ordinary preferred-class mortality tables.
Regulators also would like more data to support efforts to move toward a more flexible, “principles-based” approach to regulation.
Subgroup members discussed the statistical agent proposal earlier this week.
Representatives from the insurance industry emphasized the importance of the NAIC knowing just why it was establishing a statistical agent system.
If the NAIC simply wants to conduct national studies, it might be able to get all of the information it really needs by surveying the top 50 to 75 carriers in any market, said John Bruins, a life actuary with the American Council of Life Insurers, Washington.
Starting out with a full, accurate description of the data that regulators want is also important, because reengineering data calls can get to be expensive, said Armand de Palo, chief actuary at Guardian Life Insurance Company of America, New York. The reason, he explained, is that it becomes expensive to reengineer data calls.
Participants also discussed matters such as whether the program would rely on one statistical agent or several different firms, whether the agent (or agents) would prepare the data gathered for use, and what role state insurance departments would play in gathering the data.
John Rink, a Nebraska insurance regulator, and Tomas Serbinowski, a Utah regulator, said their departments would not want to handle company data submissions.
Determining who will pay any statistical agent, or agents, is very important, Bruins said.
Protecting the confidentiality of any data submitted is also very important, said Tom Rhodes, actuarial director of MIB Group Inc., Westwood, Mass.