Hot Topic | May 2020



SAPWG exposes COVID-19 and TALF program guidance

Proposed interpretations and revision to SSAP No. 26R to include accounting guidance for COVID-19 and the TALF program.

Jennifer Austin

Jennifer Austin

Partner, Dept. of Professional Practice, KPMG US

1 212-872-2946

Alan Goad

Alan Goad

Partner, Dept. of Professional Practice, KPMG US

+1 212-872-3340

Olga Roberts

Olga Roberts

Managing Director, Dept. of Professional Practice, KPMG US

+1 212-909-5015

The Statutory Accounting Principles Working Group has exposed an INT providing guidance on participation in the TALF program, plus three INTs and a revision to SSAP No. 26R in response to COVID-19. 


  • All insurance companies preparing financial statements in accordance with statutory accounting principles

Relevant dates

  • Proposals issued May 5, 2020
  • Comments due on proposals by May 14, 2020

Key impacts

  • INT 20-05 proposes an exception to the collectability and nonadmittance interest guidance in SSAP No. 34 for certain financial instruments modified in response to COVID-19, and provides guidance on how interest would be recognized when a payment holiday is given and interest is not accrued.
  • INT 20-06 proposes guidance for direct borrowers in the Terms Asset-Backed Securities Lending Facility (TALF) program and those that participate as an investor to a direct TALF borrower. Direct TALF borrowers would be allowed to admit pledged assets even though the TALF program does not permit the pledged assets to be substituted.
  • INT 20-07 proposes certain practical expedients in assessing whether modifications to debt instruments in response to COVID-19 are insignificant under SSAP No. 36 and whether a change is substantive under SSAP No. 103R.
  • INT 20-08 proposes that premium refunds issued in response to COVID-19, issued outside of policy terms, be reported as a reduction of premium (and not as an expense). It also proposes guidance on premium refunds required under the policy terms, premium rate reductions and policyholder dividends; and would require aggregate disclosure of these items to allow for easy identification of the full effect from COVID-19.
  • A proposed revision to SSAP No. 26R would clarify that after a modification under SSAP No. 36 or SSAP No. 103R, future assessments of other-than-temporary impairment would be based on the post-modification contractual terms of the debt instrument. 

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