Skip to main content
The Actuary: The magazine of the Institute and Faculty of Actuaries - return to the homepage Logo of The Actuary website
  • Search
  • Visit The Actuary Magazine on Facebook
  • Visit The Actuary Magazine on LinkedIn
  • Visit @TheActuaryMag on Twitter
Visit the website of the Institute and Faculty of Actuaries Logo of the Institute and Faculty of Actuaries

Main navigation

  • News
  • Features
    • General Features
    • Interviews
    • Students
    • Opinion
  • Topics
  • Knowledge
    • Business Skills
    • Careers
    • Events
    • Predictions by The Actuary
    • Whitepapers
    • Webinars
    • Podcasts
  • Jobs
  • IFoA
    • CEO Comment
    • IFoA News
    • People & Social News
    • President Comment
  • Archive
Quick links:
  • Home
  • The Actuary Issues
  • October 2012
10

Institute and Faculty of Actuaries responds to FSA/FRC CP12/10

Open-access content Wednesday 3rd October 2012 — updated 5.13pm, Wednesday 29th April 2020

The Institute and Faculty of Actuaries recently responded to a joint consultation by the Financial Services Authority (FSA) and the Financial Reporting Council (FRC) on projection rates and statutory money purchase illustrations (SMPI).

The Institute and Faculty of Actuaries recently responded to a joint consultation by the Financial Services Authority (FSA) and the Financial Reporting Council (FRC) on projection rates and statutory money purchase illustrations (SMPI).

One of the key proposals from the FSA was to reduce the maximum intermediate projection rate from 7% to 5%, reflecting the lower returns illustrated in a PwC report of 10 April for a fund composed of 67% equities and 33% bond investments.

Mike Kipling, chair of the working party formed to respond to CP12/10, said: "Consistency between the SMPIs and the FSA illustrations provides considerable value to customers. The FSA could have given more consideration to the suitability of projections issued to existing policyholders. A 5% maximum intermediate growth rate is not the most appropriate way of addressing concern that the current maximum rates are too readily applied. The maximum rate (for a 100% equity fund) could be set higher than 5%, and within the range recommended by PwC, namely 6.5% to 8%. This would be consistent with the FSA's intention to adopt PwC's recommendations."

This article appeared in our October 2012 issue of The Actuary.
Click here to view this issue
Filed in:
10

You might also like...

Share
  • Twitter
  • Facebook
  • Linked in
  • Mail
  • Print

Latest Jobs

Senior Underwriting Risk Manager

London (Central)
£85K-£95K + Benefits
Reference
124386

Reserving Manager (Contract)

London (Central)
£1200 - £1400 per day
Reference
124385

Life Actuary - Contract - IFRS 17 Financial Impact

England, London / England, Bristol / North Yorkshire, England
£900 - £1150 per day
Reference
124384
See all jobs »
 
 

Today's top reads

 
 

Sign up to our newsletter

News, jobs and updates

Sign up

Subscribe to The Actuary

Receive the print edition straight to your door

Subscribe
Spread-iPad-slantB-june.png

Topics

  • Data Science
  • Investment
  • Risk & ERM
  • Pensions
  • Environment
  • Soft skills
  • General Insurance
  • Regulation Standards
  • Health care
  • Technology
  • Reinsurance
  • Global
  • Life insurance
​
FOLLOW US
The Actuary on LinkedIn
@TheActuaryMag on Twitter
Facebook: The Actuary Magazine
CONTACT US
The Actuary
Tel: (+44) 020 7880 6200
​

IFoA

About IFoA
Become an actuary
IFoA Events
About membership

Information

Privacy Policy
Terms & Conditions
Cookie Policy
Think Green

Get in touch

Contact us
Advertise with us
Subscribe to The Actuary Magazine
Contribute

The Actuary Jobs

Actuarial job search
Pensions jobs
General insurance jobs
Solvency II jobs

© 2022 The Actuary. The Actuary is published on behalf of the Institute and Faculty of Actuaries by Redactive Publishing Limited. All rights reserved. Reproduction of any part is not allowed without written permission.

Redactive Media Group Ltd, 71-75 Shelton Street, London WC2H 9JQ