In March, the Role of the Actuary Subgroup submitted proposed to Section VM-31 of the Valuation Manual to LATF. The revisions, relating to qualified actuaries, were submitted for clarification and consistency with the Standard Valuation Law. The Subgroup also submitted proposed to the Corporate Governance Guidance Appendix, Section VM-G, of the Valuation Manual. The Joint Academy Life Experience Committee and SOA Preferred Mortality Oversight Group submitted in March to LATF on the removal of the pr
Washington state pushed the PBR count over the line as 42 states, representing 75 percent of U.S. direct written premiums, have adopted new SVLs. In addition, the South Carolina legislature has passed a new SVL, which was awaiting the governor’s signature as of April 15. PBR will be effective only after a supermajority of states and territories (42), representing 75 percent of written premium, adopt the revised law. It will apply only to new life insurance business. Cande Olsen, PBR Strategy Subgroup chai
As with P&L insurers, life insurers must report expenses as they are incurred. Since life insurance agents often earn commissions exceeding the 1 year premium on life insurance policies, increasing sales of life insurance policies would reduce the income or cause losses for the life insurer. The increase in legal reserves for the written policies would further reduce income or increase losses. To mitigate the negative effect that new policies have on the income of life insurers, and recognizing that most of
Investment income is reported as both gross income and net income. is simply all investment income before subtracting expenses: is what remains after subtracting expenses. Life insurers earn the same type of income as P&L insurers: interest earned on bank deposits, bonds, mortgages, and collateralized loans stock dividends and real estate income.
On March 31, Washington Governor Jay Inslee signed into law Senate Bill 5180 to revise the state’s standard valuation law (SVL) for life reserves (you can find out more about this legislation at the Academy’s StateScan tool ). With his signature, principle-based reserving (PBR) met key milestone in more than decade of development. Forty-two states representing 75.003 percent of premium have now adopted new SVLs—the threshold set for the Valuation Manual (VM) adopted by the National Associa