A working group is pushing ahead with an effort that could affect how insurers reserve for group long-term disability insurance (LTD) business.
The working group, made up of representatives from the American Academy of Actuaries (AAA) and the Society of Actuaries (SOA), Schaumburg, Ill., recently sent an update on efforts to develop a group LTD valuation table to the Health Actuarial Task Force at the National Association of Insurance Commissioners (NAIC), Kansas City, Mo.
The task force included the group LTD valuation table project update in its packet of materials for the NAIC’s recent spring meeting in New Orleans.
The SOA paved the way for the valuation table project by using a database of 1 million LTD claims and 680,000 claim terminations to produce a 10-year 2008 LTD claim termination experience report in 2009.
In May 2011, the AAA/SOA Group LTD Work Group began using the 2008 SOA report to create a valuation table that could replace the 1987 Commissioners Group Disability Table.
The actuaries note in their update that the new experience study deals only with disabled life terminations, not with matters such as the discount rates used to value benefits obligations.