ASB Adopts Revisions of ASOP Nos. 7 and 20

The Actuarial Standards Board (ASB) of the American Academy of Actuaries adopted revisions of Actuarial Standard of Practice (ASOP) No. 7, now titled Life or Health Cash Flow Analysis, and No. 20, now titled Analysis of Property/Casualty Cash Flows, Including Discounting.

Since the 2002 revision of ASOP No. 7, the use of advanced models for cash flow analysis has become widespread. In addition, the ASB has since approved several ASOPs related to the modeling and analysis of cash flows. Therefore, the ASB decided to revise ASOP No. 7 in December 2020. After the exposure of the revised standard, in response to comments received, the ASB decided to remove property/casualty actuarial services from the scope of the standard and expand ASOP No. 20 to include property/casualty cash flow analysis. Both ASOPs underwent one exposure and they received nine and seven comment letters, respectively. The revision of ASOP No. 7 is being issued in conjunction with the revision of ASOP No. 20. Both ASOPs are effective for any actuarial work product covered by their respective scopes issued on or after June 1, 2026.