Issues & Trends | September 2020

 

Insight

Insurance: NAIC 2020 summer meeting

KPMG reports on NAIC actions and discussions about ongoing projects on conference calls and at the 2020 summer meeting.

Applicability

NAIC 2020 summer meeting

  • All insurance companies 

Relevant dates

  • Effective immediately, unless otherwise indicated

Key impacts

The National Association of Insurance Commissioners (NAIC) adopted the following guidance:

  • SSAP No. 32R and a revised issue paper to improve preferred stock definitions, revise measurement guidance and clarify impairment guidance for preferred stock.
  • INT 20-08 to require premium payments not made under policy terms to be recorded as an adjustment to premium, unless the insurer is applying a limited-time scope exception for COVID-19 relief payments or has a different prescribed or permitted practice.
  • INT 20-09 to provide accounting guidance for basis swaps issued by Central Clearing Parties in response to transitioning from LIBOR to the Secured Overnight Financing Rate.
  • COVID-19 related interpretations of INTs 20-02, 20-04 and 20-05 to extend the effective dates to December 30, 2020.

The NAIC exposed revisions to the following guidance:

  • SSAP No. 25 to clarify the types of entities and individuals considered related parties after incorporating comments from interested parties and to add disclosures.
  • Two options to account for credit tenant loans.
  • SSAP No. 71 to clarify the guidance for levelized commissions, including the timing of expense recognition.

Report contents

  • Meeting highlights
  • Investments
  • Other accounting highlights
  • Principle-based reserving
  • Group capital calculation
  • Risk-based capital
  • Long-term care

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