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A stetment from Commissioner StewartFor Immediate Release: Contact:Elliott JacobsonMarch 12, 2009 (302) 674-7303 (202) 294-3266 cell Michael Gould (302) 674-7305STATEMENTKAREN WELDIN STEWART, CIR-MLEMERGENCY RESERVING RELIEF FOR LIFE INSURANCE COMPANIES(6-MONTH SUNSET)On November 11, 2008, the Capital and Surplus Relief Working Group was foemrd by the NAIC Executive Committee to review a request received from the American Council of Life Insurers (ACLI) for near-term relief within the life insurance industry. Before year-end, many NAIC technical working groups foemrd by the state regulators, including actuaries, accountants and attorneys, had researched the requests and responded with positive recommendations to six (6) of the nine (9) items requested. The technical groups re-worked some of the requests and added disclosures so that should the relief be provided by any of the insurance departments in the United States, it would be done so in a responsible fashion and in a way that still protected the interests of the policyholders. A public hearing was held in Washington D.C. on January 27, 2009, and at the end of an open meeting, the Working Group favorably recommended those six items. These changes were primarily actuarial in nature and would reduce some redundant life reserving rules, many of which were slated to change in the next couple of years. There was also a recommendation to increase the admissibility of deferred tax assets. On January 29, 2009, the Executive Committee of the NAIC decided to withhold their support of this relief on a national, uniform basis for the 2008 year-end preliminary annual statement filings that are due March 1st due to the inadequate time to perform the necessary evaluation. Nationwide, each state’s regulators are currently discussing these changes for the annual statement for 2009. However, each state regulator may adopt the working group’s findings for the 2008 reporting if sufficient time is given to each company to perform the appropriate analysis and submit it to their state’s regulator. The individual states were encouraged to determine the need within their states for this relief and then provide it through permitted practices or otherwise for 2008 filings.The Delaware Department of Insurance issued a Bulletin on February 11, 2009 stating that the Department would consider permitted practice requests from individual companies. The Department later approved permitted practice requests from three (3) life insurance companies regarding a small increase in the admissibility of deferred tax assets for one year only. A complete listing of the states granting and the companies receiving approval to use this permitted practice, including the amounts approved, can be found at the NAIC’s website (www.naic.org).On February 17, 2009, in order to allow a permitted practice for each individual life insurance company, I signed two (2) emergency orders amending Delaware Regulations 1212 and 1215 relating to reporting reserves for life insurance companies. These amendments provided changes to minimum reserving standards where there were redundant reserves confirmed by the NAIC Working Group. The change to Regulation 1215 allows a life insurer to use a mortality table, which has already been approved for use with policies issued for 2007, to be used for policies issued on or after January 1, 2004, with prior Department approval. The Department permitted this change for one (1) life reinsurance company for the 2008 year-end. (There are no direct policyholders.) The change to Regulation 1212 makes an adjustment to a deficiency reserve calculation. The required actuarial certifications, experience reporting requirements, asset adequacy testing will ensure that reserves are adequate. Both of these changes will protect the interests of consumers and the general public by enabling the industry to retain capacity to write insurance products needed by consumers and to reduce life insurance costs that impact pricing. These Emergency Orders will be effective until September 1, 2009 or until the amendments are adopted pursuant to the Delaware Administrative Procedures Act, whichever shall occur first.
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(VISITOR) AUTHOR'S NAME
Maria
MESSAGE TIMESTAMP
19 december 2014, 13:24:14
AUTHOR'S IP LOGGED
183.222.157.56
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