The ASB also approved for exposure a revision of ASOP No. 29, now titled Expense Provisions for Future Cost Estimates for Prospective Property/Casualty Risk Transfer and Risk Retention. The ASOP applies to actuaries when developing or reviewing expense provisions for future cost estimates for prospective property/casualty risk transfer or risk retention. This includes expense provisions developed or reviewed for insurance, reinsurance, self-insurance, loss portfolio transfers, or any other mechanisms for prospective property/casualty risk transfer or risk retention. If the actuary’s actuarial services involve reviewing expense provisions developed by another party, the actuary should use the guidance in the ASOP to the extent practicable. The comment deadline is May 31, 2022. Information on how to submit comments can be found in the exposure draft.
The ASB recently adopted a revision of ASOP No. 4, Measuring Pension Obligations and Determining Pension Plan Costs or Contributions. The ASOP provides guidance to actuaries when performing actuarial services with respect to measuring obligations under a defined benefit pension plan and determining periodic costs or actuarially determined contributions for such plans. While other actuarial standards of practice address assumptions, asset valuation methods, and assessment of risk, the revised ASOP addresses broader measurement issues, including cost allocation procedures and contribution allocation procedures. The standard provides guidance for coordinating and integrating all of the elements of an actuarial valuation of a pension plan. The standard is effective for any actuarial report issued on or after Feb. 15, 2023; and if the measurement date in the actuarial report is on or after Feb. 15, 2023.