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The Actuary The magazine of the Institute & Faculty of Actuaries

Life Board news

Life guidance notes – plans for revision and call for volunteers

In December 2004, the Life Board published a number of new guidance notes (GNs), as well as technical amendments to various existing GNs, to reflect the new regime for actuaries in life insurers. These GNs, which took effect on 31 December 2004, were introduced using the fast-track procedure, and will be fully revised during 2005 or early 2006.The board expects to revise the guidance in three tranches. The first tranche, to be exposed for comments by members in the summer, will comprise GN44 and a combined note covering GN37 and GN39. The second tranche will comprise GN47 and some of GNs 40–43; these are likely to be exposed in the autumn. The third tranche, comprising GN46 and the remainder of GNs40–43, are likely to be exposed in early 2006. A number of the life guidance notes that were subject to technical amendments at the end of last year are also likely to be revised during the coming year or so.

Any comments relating to the operation of the guidance would be welcome and will be taken into account during the revisions. Comments should be sent to Maria Singleton (email marias@actuaries.org.uk) as soon as possible.

If you would like to be involved in a working party revising a guidance note, please contact Maria Singleton, giving details of the GN you are interested in and a brief note setting out your experience of using the guidance. Although the time commitment will vary according to the GN being revised, volunteers should be able to attend regular working party meetings (usually in the daytime and possibly by telephone as well as in person) and correspond by email. More details are available on the profession’s website at: www.actuaries.org.uk/Display_Page.cgi?url=/life_insurance/job_lifeguidance.html.

Volunteers will be selected to ensure as wide a range of experience and backgrounds as possible.

Members should note that GNs 44 to 47 are technical in nature and are expected to apply to all actuaries, not just statutory function-holders. Accordingly, actuaries with other roles relating to life insurers, such as directors, are subject to and should abide by these GNs, and should consider what steps they have to take in accordance with PCS or otherwise, where that insurer does not intend to abide by them.

Peer review

The board has established a small working party to consider and develop proposals for the introduction of peer review. This will include asking role-holders for their 2004 year-end experiences via a survey and meeting with the Association of British Insurers and the Financial Services Authority (FSA) to seek stakeholders’ views. It is anticipated that the working party will make recommendations to the board by the autumn.

Life Convention 2005

Following the huge success of the 2004 convention, which was attended by over 750 delegates, planning has now begun in earnest for the 2005 convention. This will take place from 20 to 22 November in Cardiff and, as in previous years, there will be a wide range of breakout sessions, covering themes such as products and distribution, risk management, financial reporting and regulation, and raising and managing capital, as well as a number of high-profile speakers at plenary sessions. Don’t forget to put the date in your diaries – a draft programme will be available in the coming month or so. It’s not too late to put forward your ideas for a session; please email them to Perry Thomas at pthomas@uk.rgare.com.

CILA 2005

This year’s Current Issues in Life Insurance (CILA) seminar will be held on 19 April at the Barbican Centre, London. There will be plenary sessions on the new guidance notes, the Morris review, accounting issues, and treating customers fairly. The brochure for the event is now available on the profession’s website.

Treating customers fairly

At the end of January, the FSA published PS05/01 Treating with-profits policyholders fairly – feedback on CP04/14 and made text. As a result of comments by the profession and others, the FSA has made a number of changes to the detail of its proposals, including in relation to consumer-friendly PPFMs. More details can be found via the FSA’s website at www.fsa.gov.uk/pubs/policy/05_01/index.html.

Following the presentation at the 2004 convention by the working party on treating non-profit policyholders fairly, and the session at this year’s CILA (see above), the board will be considering what further work might be carried out on this topic.