New York Codes, Rules and Regulations › Title 11 - INSURANCE › Chapter IV - Financial Condition Of Insurer and Reports to Superintendent › Subchapter B - Life Insurers › Part 95 - REGULATIONS GOVERNING AN ACTUARIAL OPINION AND MEMORANDUM › Section 95.10 - Additional considerations for analysis

Current through Register Vol. 46, No. 28, July 10, 2024
(a)
Aggregation.
For the asset adequacy analysis for the statement of
					 actuarial opinion provided in accordance with section
					 95.8 
					 of this Part, reserves and assets may be aggregated as follows:
(1) Aggregation of the results of asset
				  adequacy analysis of one or more products within a line of business as defined
				  in section
				  95.4(i) 
				  of this Part, the reserves for which prove through analysis to be redundant,
				  with the results of one or more products within a line of business, the
				  reserves for which prove through analysis to be deficient. Where two or more
				  products within a line of business are aggregated because they are backed by an
				  investment segment, the rationale for each such segment shall be provided. The
				  liability cash flows shall be projected separately for at least products with
				  cash settlement options and products without cash settlement options.
(2) With the prior written approval of the
				  superintendent, based on the following guidelines, aggregation of the results
				  of asset adequacy analysis for one or more lines of business, the reserves for
				  which prove through analysis to be redundant, with the results of one or more
				  lines of business, the reserves which prove to be deficient.
(i) In order to aggregate one or more lines
				  of business, any cash-flow testing of assets and liabilities must be performed
				  separately and the results reported for each line of business being
				  aggregated.
(ii) If the asset
				  adequacy analysis is done on an aggregate basis for lines of business with
				  different testing periods, the common reference date shall be the valuation
				  date.
(iii) If aggregation is used
				  for one or more lines of business, the appointed actuary must provide, to the
				  satisfaction of the superintendent, the following in the memorandum:
(a) a demonstration that the asset adequacy
				  results for the various products or lines of business are developed using
				  consistent economic scenarios or are subject to mutually independent risks,
e.g.,
the likelihood of events impacting the adequacy of the
				  assets supporting the redundant reserves is generally unrelated to the
				  likelihood of events impacting the adequacy of the assets supporting the
				  redundant reserves is generally unrelated to the likelihood of events impacting
				  the adequacy of the assets supporting the deficient reserves;
(b) detailed descriptions of the assumptions
				  used to develop the asset and liability cash flows; and
(c) where reserve redundancies of
				  participating products or products with nonguaranteed elements are used to
				  offset deficiencies, in addition to a description of dividends, experience
				  rating or declaration of additional amounts, the memorandum shall include for
				  the level scenario, a comparison of the modeled dividends and additional
				  amounts to those actually paid over the recent past.