NAIC Updates
The NAIC has posted its preview for the upcoming Fall National Meeting (December 8–11 in Hollywood, FL). Some noteworthy items include:
- Continued discussion of the Revised RBC Principles (Risk-Based Capital Model Governance Task Force)
- Continued discussion of the VM-22, AG 55, Generator of Economic Scenarios (GOES), and AG 53 reviews (Life Actuarial Task Force)
- Consider adoption of 2024-06: Risk Transfer Analysis on Combination Reinsurance Contracts (Financial Condition Committee)
- Discussion of comments on the risk transfer analysis of combo reinsurance agreements and negative interest maintenance reserve (IMR) proposals (Statutory Accounting Principles Working Group)
- Receive reports on the modeling methodology for collateralized loan obligations (CLOs) (Valuation of Securities Task Force)
- Receive reports on the credit rating provider (CRP) rating due diligence framework and Filing Exempt discretion projects (Valuation of Securities Task Force)
- Receive an update on the ongoing Aggregation Method (AM) Review, including technical input provided by interested parties for consideration on topics including interest rate risk, valuation, and other tools (Aggregation Method Implementation Working Group)
- Discussion of International Association of Insurance Supervisors (IAIS) initiatives, including implementation of Insurance Core Principles (ICPs) and ComFrame, the global insurance capital standard (ICS), and the holistic framework for systemic risk assessment (International Insurance Relations Committee)
- Finalization of the AI Systems Evaluation Tool (Big Data and AI Working Group)
- Discussion of the status of the Cybersecurity Event Notification Project (Cybersecurity Working Group)
- Discussion of the Third-Party Framework (Third-Party Data and Models Working Group)
- Receive an update on the development of a Cybersecurity Response Framework for multistate coordination of cybersecurity events (Market Regulation and Consumer Affairs Committee)
- Discussion of the prior authorization white paper (Regulatory Framework Task Force)
The proposed disclosures ultimately will need to go through the Blanks Working Group before becoming effective; the MWG wants to see these disclosures in place for year-end 2026 reporting. The proposed disclosures generally track with the ACLI’s suggested framework, with a few additional disclosures regarding the amount of funding agreements that support puttable FABNs and a requirement to indicate whether funding agreements are hedged (by currency denomination). Comments are due December 8. NAIC staff reminded stakeholders that there would be additional opportunities for comment as the proposal makes its way through the Blanks process.
In addition, as part of this process, the MWG anticipates making a referral to the Receivership and Insolvency Task Force (RITF) regarding the current treatment of funding agreements in an insolvency proceeding. Regulators also will engage in additional education and training on FABNs.
The RBC Investment Risk and Evaluation Working Group spent most of its November 4 call discussing the ACLI’s proposal to treat Securities Valuation Office–identified (SVO-identified) Fixed Income-Like SEC Registered Funds the same as SVO-identified bond exchange-traded funds (ETFs) and SVO-identified private bond funds in the Life RBC formula. Philip Barlow (Chair-DC) explained that (1) there may be aspects of these funds that would prevent regulators from moving forward with aligning the RBC treatment, and (2) no actual analysis has been conducted to determine whether the current treatment is incorrect. He directed the ACLI to continue to work with NAIC staff to develop a revised proposal for the life formula. On a parallel track, the health and P&C RBC working groups are considering a referral summarizing the initial proposal and will determine if the changes are appropriate for their formulas.
The working group also adopted its working agenda (see Attachment 6 of the Meeting Materials). The group will not meet at the Fall National Meeting but has scheduled a call for December 15 to receive an update from the American Academy of Actuaries on its collateralized loan obligations (CLO) project.
The Life Actuarial Task Force (LATF) took a major step in the implementation of Actuarial Guideline (AG) 55 (Asset Adequacy Testing for Reinsured Business) by adopting templates that can be used to fulfill reporting requirements. Prior to adoption, the task force incorporated the ACLI’s proposed clarifications for instances where the reinsurer is performing all reinvestments or when the ceding company and reinsurer are using the same assumptions (in those instances, the reporting entity may not be required to complete certain tabs). Companies within the scope of AG 55 can now start to complete the template—the first filing is due on April 1, 2026.
Additionally, the task force adopted APF 2025-13, which is related to the use of non-U.S. mortality tables. Following meetings with companies this year, regulators recognized that additional information would be required before allowing companies to use non-U.S. mortality tables; the APF codifies this additional necessary information. The Society of Actuaries is working to gather information about certain jurisdictions’ mortality tables and plans to present on China and Canada’s tables at the Fall National Meeting.
Finally, the task force exposed APF 2025-15, which updates VM-20 (and by extension, VM-21 and VM-22) to reflect more granular NAIC Designation Categories. When principle-based reserving (PBR) was established, PBR credit ratings gave a more granular designation than what was used for NAIC designations; now that the more granular NAIC categories are available, the additional granularity in PBR is no longer needed. The APF was exposed for 60 days.
On October 31, the Life RBC Working Group and Variable Annuities Capital and Reserve Subgroup held a joint call to discuss several exposures. Notably, the groups re-exposed proposed changes to C-3 Phase I and Phase II calculations and Life RBC instructions, incorporating feedback from several stakeholders. Regulators agreed to include a cover sheet containing several questions posed by industry, including whether additional approaches to the treatment of voluntary reserves should be considered. Seong-min Eom (NJ) suggested making several of the proposed changes disclosure-only so that regulators can make a comparison in a few years, particularly in light of the new Generator of Economic Scenarios (GOES). The groups also took the following actions:
- Adopted proposed changes to the VM-21 Supplement and Instructions
- Exposed scope clarification for VM-21 and Life RBC (APF 2025-14), RBC Proposal 2025-17-L, and Life RBC Appendix 1 Instructions changes
- Heard an update from NAIC staff on unfloored VM-21 model office results for three different cohorts (see Attachment Six of the Meeting Materials)
Also on November 5, the Annuity Suitability Working Group unanimously adopted its Annuity Best Interest Regulatory Guidance and Considerations document. The guidance will next be considered by the Life Insurance and Annuities (A) Committee at the upcoming Fall National Meeting.
The Financial Analysis Solvency Tools Working Group (FASTWG) took the following actions on its November 6 call:
- Formed drafting group on Model #385 Financial Hazardous Condition Standards Guideline: Greg Chew (Chair-VA) reported that NAIC staff has reviewed comments received on this item from North Carolina; Ohio; Wisconsin; and Doggett Consulting Services, LLC, which consist of varying suggestions on calculations and components used in the guidance. Due to the lack of consensus, a drafting group will be formed to work on this component of the Financial Analysis Handbook. Given the timing, any agreed-upon changes would not be reflected in the upcoming edition of the Handbook, which allows the drafting group considerable time to reach consensus. So far, regulators from Missouri, Ohio, and Wisconsin have agreed to participate in the drafting group.
- Adopted remaining Financial Analysis Handbook edits: Revisions to the remaining sections of the Handbook were adopted, including a few additional changes informed by feedback received during the exposure period (highlighted in yellow in the Meeting Materials): (1) added a definition of “risk component” in the Branded Risk Assessment General Guidance; (2) minor language changes were made in the Credit Risk Assessment; (3) in the Insurer Profile Summary, generic language was added for the insurer to briefly summarize its holding company system; and (4) in the Group Profile Summary, an International Jurisdictions component was added for companies to indicate various countries and capital regimes, if applicable.
The Privacy Protections Working Group (PPWG) met on November 7 and briefly discussed comments on Article VI (Exceptions to Limits on Disclosures of Nonpublic Personal Information). The working group also published revisions to Article V (Limits on Disclosures of Nonpublic Personal Information), which will reopen for comment at the end of the drafting process when the revised regulation is exposed in its entirety. Director Dwyer (Chair-RI) announced that the working group will seek a drafting extension from the H Committee at the upcoming Fall National Meeting through the end of 2026. Finally, she expects the next Article to be exposed for comment soon.
Staff Contact - Sean McKennaInternational Developments
InsuranceERM held its inaugural Global Life Reinsurance USA Conference in New York on November 3, 2025. The event was well attended by industry leaders and regulators, including Commissioner White (VA), Kevin Clark (IA), and Eugene Dimitriou (Bermuda Monetary Authority (BMA)). The conference primarily centered on asset-intensive reinsurance; the U.S., Bermuda, and Cayman Islands regulatory regimes; and the role of private equity. There was consensus that regulatory frameworks must adapt to new business models (the influx of private equity and the use of alternative assets), all while balancing innovation, capital efficiency, and consumer protection. Key discussion topics included:
IAIS Structural Shifts Issues Paper
- Clark (Iowa) provided an overview of his and Carrie Mears’ contributions to the International Association of Insurance Supervisors (IAIS) draft Issues Paper on Structural Shifts in the Life Insurance Sector, noting that perspectives are now more balanced than when the work started a few years ago.
- As for next steps, the focus will be on developing and sharing best practices among jurisdictions and deepening regulatory cooperation. Near-term regulatory changes are not expected.
- Discussions aligned on the importance of transparency, prudence, and access to private capital as drivers of AIR’s success, while expressing that regulatory engagement makes the sector stronger.
- Many panelists stressed the need for increased international cooperation and education for continued AIR growth, particularly given skepticism about offshore reinsurance.
- Commissioner White acknowledged AIR benefits such as increased availability of products and improved management of capital-intensive liabilities. However, he noted that regulators are looking closely at risks and emphasized the need for prudent risk management and robust disclosure, praising the NAIC’s recently adopted AG 55.
- Clark explained that AG 55 is designed to provide U.S. regulators with clear, actionable insights on the sufficiency of assets backing offshore reinsurance reserves, noting the large volume of U.S. business ceded to other jurisdictions. He went on to say that U.S. regulators “can’t cede our responsibility to ensure claims will be paid to policyholders to another jurisdiction’s regulator, regardless of how competent and rigorous their system is,” and that AG 55 ultimately provides comfort to U.S. regulators that they are fulfilling their responsibilities.
- The BMA stated that Bermuda’s existing regime already incorporates many cautionary layers and sees AG 55 as complementary rather than threatening.
- Bermuda’s credibility and regulatory transparency were prominent talking points throughout the conference. Panelists praised the close collaboration between U.S. regulators and the BMA, and Clark highlighted the strength of Bermuda’s actuarial talent.
- Natasha Scotland Courcy (CEO, Athene Life Re and Chair of Bermuda International Long Term Insurers and Reinsurers (BILTIR)) highlighted Bermuda’s strong capitalization and disciplined regulatory approach, among other things, stating that these factors make it well-positioned for innovation and growth
- Private equity (PE) was characterized as a transformative force in the insurance and reinsurance sectors; panelists noted the benefits of PE involvement, including capital, asset origination capability, and innovation through partnerships.
- Some discussions touched on the necessity of regulatory scrutiny to ensure perceived risks are properly disclosed and managed.
- Panelists also discussed how PE-backed insurers are well-positioned to meet the rising demand for long-duration liabilities and that the future would likely see continued growth and convergence of PE and insurance business models.
- When asked whether the Cayman Islands intends to become an NAIC Qualified Jurisdiction, the Cayman International Reinsurance Companies Association reported that it has been under consideration for a while, but the process has not been formally initiated.
- Panelists explained that while it is a long-term goal and would be valuable for market perception and further alignment, the lack of “equivalence” is not currently prohibitive for business growth or regulatory engagement.
AI Activity
In response to several insurer inquiries, the Colorado Division of Insurance issued a draft proposed bulletin regarding the manner and format of the required interim progress reports for private passenger auto and health insurers. The bulletin states that the Division has not prescribed a specific format for the interim report; insurers may submit the report in their preferred format so long as it addresses the regulatory requirements. Suggested components of the report include an executive summary, brief update on progress made, challenges encountered and potential solutions, and an expected completion date. Comments on the draft bulletin were due November 12, and interim reports are due no later than December 1.
Staff Contact - Sean McKennaPrivacy Updates
The California Privacy Protection Agency announced that it is changing its public-facing name to “CalPrivacy.” The name was chosen to underscore the agency’s commitment to operationalizing privacy rights and providing guidance to all Californians.
A Jane Doe plaintiff has filed a proposed class-action lawsuit against a group of Georgia healthcare facilities alleging that the providers disclosed patients’ confidential health information to Google without consent through website tracking and data collection tools. According to the complaint, the providers broke their promise not to share patients’ protected health information without written consent by using Google tracking and data collection tools to divulge the information for marketing and analytic purposes. The complaint alleges that information shared included IP addresses, account numbers, cookie identifiers, information patients typed into registration and appointment forms, reasons for appointments, and information regarding the location of the appointments.
Senator Bill Cassidy (R-LA) has introduced the Health Information Privacy Reform Act. The act aims to add new privacy protections to health data gathered by smartwatches, health apps, and other new technology that is not currently covered by HIPAA.
Staff Contact - Sean McKenna