On a March 16 conference call, the NAIC Principle-Based Reserving Implementation (EX) Task Force adopted the 2015 XXX/AXXX Reinsurance Supplement Proposal. The Proposal adds to the Annual Statement a reinsurance exhibit which discloses data regarding reinsurance cessions subject to reserve valuation under Regulations XXX and AXXX. Significantly, after considering public comments on the proposal, the Task Force decided to make one part of the Supplemental Exhibit confidential at least for 2015, meaning that only regulators would see the related information. That information pertains to a question in the interrogatories section of the exhibit which asks hypothetically if the insurer’s RBC ratio would be in a regulatory action level were it to unwind the insurer’s captive reinsurance cessions. The Task Force believed that, while regulators may understand that the answer to this question was purely hypothetical, the public could possibly misunderstand or misuse it.
The Proposal will now go to the Task Force’s parent group, the NAIC Executive Committee, for consideration presumably at the upcoming Spring NAIC Meeting scheduled for March 28-31.
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