By Will Behnke
Policy Project Manager, Risk Management and Financial Reporting Council
As we begin 2026, the Academy’s Risk Management and Financial Reporting Council (RMFRC) is focused on providing expertise and resources on critical issues that are shaping financial stability and actuarial practice. Its priorities reflect an evolving landscape of risk, regulation, and technology, and underscore the Academy’s commitment to supporting policymakers, regulators, and actuaries with timely insights and analysis.
Climate Risk
Climate-related risks are becoming increasingly material to insurers and financial institutions. RMFRC will continue to serve as a resource for state and federal stakeholders by offering actuarial perspectives on how climate risk affects both financial reporting and risk management. This includes providing insights on scenario analysis, stress testing, and the long-term impacts on liabilities and capital adequacy.
In 2026, we will also release new work products addressing insurance affordability in the context of climate change and the increasing frequency of severe climate events, providing policymakers and actuaries with data-driven insights to inform decisions that balance consumer protection and financial stability.
Artificial Intelligence
Artificial intelligence (AI) is transforming actuarial modeling and financial reporting, while also introducing new challenges around governance and transparency. RMFRC will continue to provide expertise to regulators and legislators on the implications of AI for risk management and reporting, while developing resources for actuaries to navigate these changes responsibly. Upcoming work products include two policy papers, “Use Cases of AI in Insurance” and “Responsible Use of AI,” which will explore both practical applications and ethical considerations related to AI adoption. In addition, we will examine the climate impact of AI data centers, offering insights into how technological innovation intersects with sustainability goals.
Evolving Capital Standards
Capital adequacy frameworks are undergoing significant changes, including updates to U.S. risk-based capital, the International Association of Insurance Supervisors (IAIS) Insurance Capital Standard (ICS), and accounting standards under U.S. Generally Accepted Accounting Practices (GAAP) and International Financial Reporting Standards (IFRS). RMFRC will provide analysis and develop educational resources to help actuaries and policymakers understand these developments and their implications for both solvency and financial reporting. Through engagement with state insurance departments and federal agencies, volunteers will ensure actuarial expertise continues to inform discussions on capital requirements.
Reinsurance
Reinsurance remains a vital tool for managing risk and capital efficiency, but market volatility and evolving structures present new challenges. RMFRC will provide resources and insights on reinsurance trends, financial reporting considerations, and risk transfer mechanisms.
Importantly, it will also address the international component of offshore reinsurance, examining how global market dynamics and cross-border regulatory frameworks influence U.S. insurers’ strategies and financial reporting. By collaborating with state and federal stakeholders, RMFRC aims to support informed approaches to reinsurance that promote stability and transparency.
Looking Ahead
RMFRC sits at the crossroads of many of the most significant policy issues facing both the Academy and the nation. Our volunteers remain resolute in their charge to offer unbiased, nonpartisan insights to policymakers in 2026. If you would like more information about RMFRC or are interested in joining one of our committees, please contact us.