Some state insurance regulators want to develop a new, multiline definition of the term “qualified actuary.”
The regulators cited questions about the value of long-term care insurance (LTCI) actuarial projections as one example of the need for the project.
In the LTCI sector, one trade group representative “recently made the statement in a public forum that company actuaries were not providing their best estimate assumptions to regulators for [LTCI] rate filings, but only information that would support their rate requests,” the regulators said in a discussion draft.
“Could it be that the appointed actuaries for these companies have similarly failed to take into account the assumptions needed to properly reserve for these products?” the regulators asked. “Anecdotal evidence suggests that some appointed actuaries exploit the vagueness of certain reserve requirements to avoid setting up needed reserves for [LTCI] business.”
Similar issues have cropped up in connection with the Medicare supplement business, the appraisals of blocks of insurance business, and the valuation of public pension plans, the regulators said.
The regulators are part of the Joint Qualified Actuary Subgroup at the National Association of Insurance Commissioners (NAIC).
The NAIC’s life, health and casualty actuarial panels created the subgroup and asked it to recommend a uniform definition of “qualified actuary.”