ASB Adopts New ASOP No. 57; Approves Exposure Draft of ASOP No. 27 Revision
The ASB adopted new ASOP No. 57, Statements of Actuarial Opinion Not Based on an Asset Adequacy Analysis for Life Insurance, Annuity, or Health Insurance Reserves and Related Actuarial Items. A conversion of Actuarial Compliance Guideline (ACG) No. 4, Statutory Statements of Opinion Not Including an Asset Adequacy Analysis by Appointed Actuaries for Life or Health Insurers, the new standard applies to actuaries when performing actuarial services with respect to providing a statement of actuarial opinion for life insurance, annuity, or health insurance reserves and related actuarial items that are within the scope of the Statement of Actuarial Opinion, NAIC Life and Accident & Health/Fraternal Annual Statement (Blue Book), when the statement is prepared to comply with applicable law and is not based on an asset adequacy analysis because of an exemption.
As ACG No. 4 was the last remaining actuarial compliance guideline and remained relevant for actuaries working for companies that receive an exemption from asset adequacy analysis, the ASB decided to convert ACG No. 4 into the standard format of an ASOP. The standard is effective for all statements of actuarial opinion covered by the scope of the ASOP issued on or after June 15, 2023.
The ASB also approved an exposure draft of a proposed revision of ASOP No. 27, now titled Selection of Assumptions for Measuring Pension Obligations. The standard applies to actuaries when performing actuarial services that include selecting assumptions used in the actuary’s measurement of defined benefit pension plan obligations, other than obligations of social insurance programs that are within the scope of ASOP No. 32, Social Insurance, unless ASOP No. 32 explicitly calls for application of the standard.
In June 2020, ASOPs Nos. 27 and 35 were both revised to expand their scope, to provide additional guidance on the combined effect of assumptions, to provide guidance on assessing assumptions not selected by the actuary, and to modify the required disclosure of rationale for assumptions selected. Throughout the past few revisions, the ASB has adopted identical language in ASOPs Nos. 27 and 35 where practical and improved the similarity of layout and structure to simplify the overall guidance. The final step in this simplification is to combine the two current pension assumption standards into one. When the proposed revision to ASOP No. 27 is adopted as the single assumption standard for pensions, ASOP No. 35 will be repealed.
The comment deadline is June 15, 2023. Information on how to submit comments can be found in the exposure draft.
