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September 19, 2011 at 08:00 PM
Norman Hill is asking drafters of an insurance experience reporting guide for more details about experience program data analysis capacity.
Hill, president of NoraLyn Ltd., Gilber, Ariz., has included the questions in a comment letter submitted to the Life Actuarial Task Force at the National Association of Insurance Commissioners (NAIC), Kansas City, Mo.
The task force is helping the NAIC develop VM-50, a section of a life valuation manual that will deal with the insurance claims experience reporting and analysis to implement a shift to a principles-based approach to reserving.
Principles-based reserving (PBR) would require insurers to use actuarial judgment and statistical forecasting to monitor and manage their finances, rather than relying on static formulas and cut-offs.
Hill notes that his understanding is that the organization that the NAIC is thinking of using as the statistical agent now has the capacity to handle data from about 250 companies.
