Actuarial Standards Board News

The ASB recently adopted ASOP No. 51, Assessment and Disclosure of Risk Associated with Measuring Pension Obligations and Determining Pension Plan Contributions, and ASOP No. 52, Principle-Based Reserves for Life Products under the NAIC Valuation Manual.

ASOP No. 51 provides guidance to actuaries when performing certain actuarial services with respect to measuring obligations under a defined benefit pension plan and calculating actuarially determined contributions for such plans, with regard to the assessment and disclosure of the risk that actual future measurements may differ significantly from expected future measurements. The standard will be effective for any actuarial work product with a measurement date on or after Nov. 1, 2018.

ASOP No. 52 provides guidance to actuaries when performing actuarial services with respect to developing or opining on principle-based reserves for life insurance that are reported by companies in compliance with applicable law based upon the National Association of Insurance Commissioners (NAIC) Standard Valuation Law and the NAIC Valuation Manual as adopted in December 2012 with subsequent amendments. The standard will be effective for valuation dates on or after Dec. 31, 2017.

ASOP Nos. 51 and 52 can be viewed here.

Read the latest news from the ASB Boxscore here.

The ASB recently approved a second exposure draft of a proposed new ASOP titled Pricing of Life Insurance and Annuity Products. The proposed ASOP will apply to actuaries when performing actuarial services with respect to the pricing of life insurance and annuity products when a product is initially developed or when charges or benefits are changed for future sales. The standard will not apply to any changes made on inforce policies. Such resetting of nonguaranteed elements, including dividends, on products in force will be outside the scope of the ASOP and are addressed in ASOP No. 2, Nonguaranteed Charges or Benefits for Life Insurance Policies and Annuity Contracts, and No. 15, Dividends for Individual Participating Life Insurance, Annuities, and Disability Insurance. The comment deadline for the exposure draft, which can be viewed under the “Drafts” tab in “Current Exposure Drafts”, is Oct. 31, 2017. Information on how to submit comments can be found in the draft.

Read the latest news from the ASB Boxscore here.

The ASB recently adopted a final revision of ASOP No. 5, Incurred Health Claim Liabilities. This ASOP provides guidance to actuaries when estimating or reviewing incurred claims when preparing or reviewing financial reports, claims studies, rates, or other actuarial communications as of a valuation date under a health benefit plan. The ASOP No. 5 revision, which will be effective Sept. 1, 2017, has been updated to reflect relevant legal, regulatory, and practice developments that have occurred since the 2000 revision. The standard can be viewed under the “Standards of Practice” tab in “Current Standards.”