As part of the NAIC SAPWG initial assessment of the TCJA impact on the statutory reporting aspects of SSAP 101, the SAPWG staff performed a cursory study of the 2016 NAIC insurance entity annual statement statistics
As expected, the NAIC interpretations of ASU–2016-02 rejected the GAAP promulgation in preference to the continued use of the SSAP No. 22 statutory lease guidance (i.e. operating lease treatment).
The handling of dividend payments from subsidiary to parent or shareholder(s) has experienced diverse accounting application caused by ambivalent insurance company interpretations or differing individual state interpretations.
SAPWG has followed the current GAAP approach by providing the option to elect reporting the AMT credit balance as either a current year federal income tax recoverable, or alternatively as deferred tax asset. Reporting as a DTA will subject the balance to the statutory accounting admittance rules.
In this article, we continue our discussion about fronting arrangements. In our previous post, we focused on the relationship between fronting and fronted carriers, including the benefits of this type of relationship, the risks associated with it, and the governing regulations. However, fronting might include more than just these two parties. Another party that might be motivated to enter into a fronting arrangement is a managing general agent or MGA.
The use of Treasury Inflation-Protected Securities (TIPS) has become increasingly popular among insurance companies in recent years. TIPS are a special kind of security issued by the United States Treasury Department. In an inflationary economy, investors are weary to invest and loose principal par value on a long-term investment. TIPS provide protection for those who have such fears.
California, along with other western states, has endured extensive wildfire destruction to properties ranging from smoke damage to constructive total losses. The Golden State’s residents have often dealt with wildfire issues due to dry weather in winter months creating fuel for fires in summer and fall months, but now fires have become pandemic year-round. In late 2017, the “Northern California Firestorm,” specifically in Sonoma County…
If an insurance or reinsurance contract does not transfer risk, it falls under the principle of deposit accounting. Under this principle premium is not recorded as income and is instead listed as an asset, which has a direct impact on the company’s leverage. In order to insure that reinsurance is applied towards surplus relief, it is important to examine the contract to see if both timing and underwriting risk have been transferred.
While the rollout of New York’s cybersecurity regulations is well underway, September 4, 2018, marked the eighteen-month transitional deadline, and now all sections of part 500 of the regulation are effective. The timeline for compliance with the New York regulation is based on the following schedule:
Following ten years of off-and-on deliberations, the Financial Accounting Standards Board (FASB or the Board) has issued a final promulgation in the accounting for long-duration insurance contracts. The promulgation is effective for calendar-year public companies in 2021 and non-public entities in 2022.