New Annual Meeting & MPC Meeting Schedules Posted
Updated agendas for NOLHGA’s 2025 Annual Meeting and October MPC meeting have been posted on the meeting website in the Schedules & Info section. We also want to remind attendees that the deadline to receive the special NOLHGA room rate of $269/night at the Grand Hyatt San Antonio River Walk, our host hotel, is September 30.
Hotel reservations, registration for both meetings, and other meeting information can be found on the meeting website. As a reminder, the MPC meeting will take place on October 22 and the morning of the 23rd, and the Annual Meeting will be held on the afternoon of October 23 and the morning of the 24th. The MPC meeting will feature the Annual Meetings of GABC and LTC Re and an educational session, as well as a meeting of the MPC Executive Committee, the MPC General Session, and other meetings. Guest speakers for the Annual Meeting include:
- Roger Crandall: Chairman, President & CEO, MassMutual
- Maddy Dychtwald: Co-Founder, Age Wave; Best-Selling Author & Global Futurist (Luncheon Speaker)
- George Nichols III: President & CEO, The American College of Financial Services
- Juhi Dhawan: Senior Managing Director, Partner & Macro Strategist, Wellington Management
Tony Buonaguro Passes Away
Tony Buonaguro, NOLHGA’s former Executive Vice President and General Counsel (and the organization’s first General Counsel) passed away on September 14, 2025. He was 79. His obituary can be found here.
Tony worked for NOLHGA from 1993 to 1998. In addition to starting the Legal Department, Legal Committee, and the annual Legal Seminar, he served during an intense period of insolvencies in the 1990s. In particular, he served as NOLHGA’s principal staff contact for the Executive Life Insurance Company of California case during the finalization/implementation of the ELIC Plan, by which guaranty associations met their $2+ billion coverage obligations.
Tony oversaw the modernization of the NAIC’s Life and Health Insurance Guaranty Association Model Act in the late 1990s and spearheaded NOLHGA’s conversion from an unincorporated association to a Virginia Non-Stock Corporation in 1997. He also co-authored (with Jana Lee Pruitt, now with the Kentucky guaranty association) the first in-depth history of the guaranty system, NOLHGA and the Evolution of the State Guaranty Association System. A link to the report can be found in the members-only section of the NOLHGA website (log in is required).
Tony was known for his keen intellect and larger than life personality, and he will be missed by many in the guaranty community. NOLHGA expresses our deepest sympathies to his family and friends.
Staff Contact - Sean McKennaFSOC Plans To Rework Financial Stability Interpretation & Rescinds Climate-Related Charters
The Financial Stability Oversight Council (FSOC) met in open session for the first time this year on September 10, 2025. Treasury Secretary Bessent presided over the meeting, kicking it off by highlighting FSOC’s economic growth priority. FSOC will consider ways to enhance supervisory and regulatory frameworks along with other efforts to better position regulated entities toward growth and innovation. To align with FSOC’s new direction, Bessent stated it will (1) develop an interpretation of financial stability that will incorporate economic growth and stability as key pillars, and (2) revise the 2023 Analytic Framework for Financial Stability Risks and Guidance on Nonbank Financial Company Determinations. He referenced “other statutory tools at FSOC’s disposal” that are better suited to mitigate financial stability risks associated with certain financial activities, such as its ability to issue recommendations to member agencies.
Bessent also announced that FSOC does not consider climate change a financial stability risk, after which FSOC voted to rescind the charters of the Climate-related Financial Risk Committee and Climate-related Financial Risk Advisory Committee.
Staff Contact - Sean McKennaNAIC Updates
On September 8, 2025, the RBC Investment Risk and Evaluation Working Group received an update on the American Academy of Actuaries’ work on collateralized loan obligations (CLOs). The Academy is working to identify a handful of CLO characteristics that can be used to assign risk (Comparable Attributes), as a possible alternative to individual CLO modeling by the NAIC’s Structured Securities Group (SSG). The Academy has developed its own model, which has been developed to align with C-1 methodology for bonds in many respects. The Academy has run six CLOs through its model, and the preliminary results generally align with the SSG’s work; specifically, senior CLO tranches are showing very low tail risk, while lower-rated tranches are showing more risk. (The Academy still needs to develop a separate approach for the treatment of residuals.) The Academy emphasized at several points that these results are preliminary.
The Academy’s model includes several assumptions (see slide 20 of the presentation linked above). Most of the discussion on the call focused on prepayment and reinvestment—currently the Academy’s model does not factor in any prepayment and assumes that collateral is reinvested at par. Slide 23 contains a number of assumptions/parameters in the current model for which the Academy is seeking input from regulators on how to address. Carrie Mears (IA) requested additional information on the materiality of any changes to these aspects of the model, which the Academy will provide. The goal is to have the first set of Comparable Attributes released by year-end.
On September 11, the Academy provided the Life RBC Working Group with updates on its C-3 methodology and covariance work. The revised C-3 framework would update the methodology for all products subject to C-3 Phase 1 and Phase 2 and would scope fixed indexed annuities into C-3 Phase 1. The current plan is to have a three-year phase-in of the new methodology. The Academy sought regulators’ feedback on a number of areas (see slide 5). Ben Slutsker (MN) suggested that the Academy should move forward, keeping the same asset-based metric that is used for C-3 Phase 2 and include stochastic equity. Regulators requested industry feedback on the number of companies that would be willing to participate in a future field test. Expect additional updates on the C-3 work as the Academy executes on direction from the working group.
The working group also exposed the Academy’s deck outlining potential covariance changes in the life RBC formula. Industry previously encouraged the working group to hold off on any changes until the new Generator of Economic Scenarios (GOES) became effective. Philip Barlow (DC–Chair) was the most vocal supporter of moving forward with an exposure. Comments are due November 10.
In other news, the ACLI provided the Statutory Accounting Principles Working Group (SAPWG) with an overview of its two proposals on the treatment of asset-liability matching (ALM) derivatives. Industry has suggested that the current framework results in many derivatives being marked-to-market in calculating surplus, which results in reported surplus that is not aligned with the company’s financial position. Industry representatives suggested that this proposal protects policyholders by ensuring that a company’s solvency position is accurately stated when it utilizes ALM derivatives.
The ACLI prefers the Amortized Cost Method, described on slides 8–13 of the ACLI’s deck. Notably, derivatives with asymmetrical payoff profiles and/or derivative premiums at inception (e.g., options) would not be eligible under this method. Due to the dynamic nature of these hedging programs, multiple hedge effectiveness tests are required each quarter, and all must be passed to apply either proposal. The guidance is designed to be applied on a prospective basis only. Comments on the options and related guidance are due October 31.
Staff Contact - Sean McKennaAI Activity
The NAIC’s Big Data and AI Working Group posted 86 pages of comments received on the draft AI Systems Evaluation Tool. Feedback is likely to be discussed during the group’s upcoming call (scheduled for September 29 at 2:00 p.m. ET), but no official agenda has been published yet.
On September 10, 2025, Sen. Ted Cruz (R–TX) introduced the Strengthening Artificial intelligence Normalization and Diffusion By Oversight and eXperimentation (SANDBOX) Act, which would establish a regulatory sandbox for AI developers and users seeking temporary relief from federal regulatory burdens. Developers or users could request a waiver or modification of federal regulations, and the relevant federal agency would consider the request in coordination with the White House Office of Science and Technology Policy. Applicants would be required to identify and disclose how they would mitigate risks relating to health and safety, economic harm, and unfair or deceptive trade practices. The act would not preempt state laws or regulations.
Staff Contact - Sean McKennaIAIS Update
The International Association of Insurance Supervisors (IAIS) held a public stakeholder session on September 9, 2025, to walk through the high-level principles (HLPs) for the development of the insurance capital standard (ICS) implementation assessment methodology. Key takeaways include:
- The HLPs serve as foundational guidance to develop the full ICS implementation assessment methodology. The methodology itself is an internal IAIS document to support the assessment work and is not likely to be made public.
- HLP 6 states that “the assessment of the implementation of the ICS in the US in the form of the final Aggregation Method (AM) is subject to the same methodology as the ICS.” The ACLI questioned the applicability of HLPs 1–5 to the AM, since they are specific to the ICS. The IAIS clarified that the specificities of the AM will be considered in the development of the detailed methodology, which is what gets used by the assessors—the HLPs do not need to be mapped against the AM.
- The IAIS ICS implementation timeline remains on track, with self-assessments (conducted by jurisdictions with internationally active insurance groups, or IAIGs) beginning in 2026 and in-depth targeted jurisdictional assessments starting in 2027.
- Development of the following ICS-related material is ongoing: (1) supervisory reporting and public disclosure documents (consultation planned for later this year); and (2) a draft Application Paper on the availability of capital (consultation planned in 2026). The application paper is broader than the ICS and will provide examples of how supervisors have been dealing with the fungibility of capital across large groups.
Privacy Updates
The California Privacy Protection Agency (CPPA) and the Attorneys General of California, Colorado, and Connecticut recently announced an investigative sweep involving potential noncompliance with the Global Privacy Control—a web browser setting or extension that automatically signals to businesses a consumer’s request to stop selling or sharing their personal information to third parties. The CPPA and the Attorneys General will be contacting businesses that may not be processing consumer opt-out requests submitted by the Global Privacy Control and requesting that those businesses comply.
In other news, title insurer Fidelity National Financial has received approval from a Florida federal court for a $5.9 million settlement of a proposed class action suit stemming from a November 2023 data breach that allegedly impacted 1.3 million people. The claims asserted include negligence, breach of fiduciary duty, and unjust enrichment.
Staff Contact - Sean McKenna