New York Times Issues Correction Requested by Academy Regarding Role of Actuaries

• Academy President Cecil Bykerk sent a letter to the editor of The New York Times on July 22 pointing out that a story regarding Detroit’s pension shortfall mischaracterized actuaries as “running” pension plans, and urging the Times to report on “the causes and the fiscally sound and sustainable solutions” for troubled public pension plans. The Times subsequently issued a correction noting that actuaries do not “run” pension plans.

Academy in the News

• Lifetime Income Risk Joint Task Force member Steven Vernon cited the task force’s report, Risky Business: Living Longer Without Income for Life, in warning CBS MoneyWatch readers that “many baby boomers approaching retirement are finding that they haven't taken sufficient measures to replace their former paychecks with reliable income that lasts the rest of their lives.” Vernon also cited the report in a follow-up column explaining why it’s important for people to plan to live beyond life expectancy averages.

News from the Actuarial Standards Board

• The ASB approved a second exposure draft of ASOP No. 25, Credibility Procedures, which expands language in several sections, including clarifying the scope as well as the purpose and use of credibility procedures. The comment deadline for the second exposure draft is Sept. 30, 2013. Learn more.
• The ASB approved an exposure draft, Principle-Based Reserves for Life Products, which applies to actuaries when performing professional services on behalf of life insurers in connection with the calculation or review of reserves for individual life insurance policies, where such reserves are represented as being in compliance with the provisions of the Standard Valuation Law and the Valuation Manual governing principle-based reserves. The comment deadline for the exposure draft is Dec. 16, 2013. Learn more. Learn more.

Deadline Approaching for Comments on the U.S. Qualification Standards

• Five years have passed since the U.S. Qualification Standards (QS) were last revised. To determine if there is a need to start the process of considering revisions to the QS, the Academy’s Committee on Qualifications, with the approval of the Academy’s Board of Directors, is undertaking a review. The committee asks all actuaries and the public to provide comments by July 31. Learn more about what areas are of particular interest and how to submit comments.

New Public Policy Activities

• The Enterprise Risk Management Committee released the final version of its practice note, “Insurance Enterprise Risk Management Practices,” which discusses ERM practices within the insurance industry and concepts such as risk culture, risk organization and risk governance.
• In a July 24 comment letter, the C1 Working Group said that it supports the Illinois Department of Insurance’s recommendations to the NAIC’s Investment Risk-Based Capital Working Group that it modify the time horizon and confidence tail expectation metric for the C1 component of the Life Risk-based Capital formula. The C1 Working Group also cautioned that consistency issues need to be considered in implementation.

Opportunities to Learn

• Sept. 24–25, Life PBR—The New Valuation World seminar: Take part in this interactive seminar combining instructor-led training with small-group discussions on the practical application of the principle-based reserving mechanics as outlined in VM-20. PBR experts will discuss the latest developments, including the new PBR Actuarial Standard of Practice and PBR practice note—both expected to be completed this year.
• Nov. 11–14, Life and Health Qualifications Seminar: Obtain the basic education you will need to acquire health and life qualifications under Section 3 of the U.S. Qualification Standards. This seminar is a primary source of instruction to become qualified. Seats are limited!

Note: Some links in this email go to external websites and may require registration. The Academy is not responsible for the content of these websites. Links may expire.