Articles / Blog

“Brother (Sister) can you spare a dime?”

The past two years have seen a lot of regulatory action on the use of captives to finance XXX/AXXX “redundant” reserves. The inspiration for the NAIC actions focus on three sources of pressure. As part of Federal Insurance Office’s report on reinsurance, they singled out the use of captives in life reinsurance as . . . Read More

Senate Proposal: Welcome Enhancements to SIFI Process?

In a proposal put forth by the Senate Banking Committee on May 12, 2015, there are several provisions to modify the Dodd-Frank Act. The proposal includes an entire section dedicated to non-bank financial institutions, and calls for, among other items, “Notices and explanations of why . . . Read More

Does IRS Need New Law on Hedge Fund Issue?

The Senate Finance Committee had tasked the IRS to develop some form of asset-based bright line test to separate off-shore (re)insurance companies from Hedge Fund shelters. As noted in my prior post, last Thursday’s proposal does not have a bright line test, but has some other tests that may be . . . Read More

IRS Proposal Defines Off-Shore Reinsurer Capital

The proposal is meant to make sure that hedge fund sponsored offshore reinsurers are not using these vehicles as a way to shelter investment gains from US taxes rather than being true reinsurers. While the proposed rules are aimed at hedge-fund-sponsored offshore reinsurers, it seems clear that the proposal . . . Read More

Zero Reinsurance Collateral: EU Starts New Effort

One source of dispute between non-United States reinsurers and United States insurance regulators has been the amount of reinsurance collateral that must be established in order for their United States cedents to take full reinsurance credit. Various entities have been lobbying the National . . . Read More

Regulatory Update (March 2015)

The NAIC is in the midst of an all-out revision of the reinsurance of level term and secondary guarantee universal life policies. Activities include: creation of a new Actuarial Guideline (AG48), creating a new regulation that implements Rector recommendations, Risk Based Capital changes, . . . Read More

Regulatory Update (August 2014)

Ever since the financial crisis, the rate of change and the impact of the international regulatory community on insurers have been on the increase. Accounting standards for insurance contracts are under review by both FASB in the U.S. and the IASB internationally. Another major development is that the International Association . . . Read More

Life and Health Marketing: Boomers vs. Millenials

In today’s insurance market, companies face a choice of markets to target. Do we service the baby boom generation’s needs for retirement income? What about long term care and other healthcare needs? Do we look to the “Gen Ys” or “Millennials” who are just entering the marketplace and whose needs . . . Read More

ORSA: U.S. Leaps Ahead

In my last blog, I discussed the passage of the Risk Management and Own Risk and Solvency Assessment (ORSA) Model Act by the NAIC. The inspiration for this move was the need for the U.S. regulatory scheme to become more compatible with the EU and Solvency II requirements. There has been . . . Read More

Risk Management: The Building Blocks of ERM

The financial crisis has introduced the area of risk management to much of the Western World via news reports, blogs and tweets. This fact has not been lost on insurance regulators, with many jurisdictions working on requirements for insurers to prepare and file an Own Risk and Solvency Assessment (ORSA) . . . Read More