NAIC Approves Valuation Manual for Principle-Based Reserves

WASHINGTON, Dec. 2 -- The American Council of Life Insurers issued the following news release:

In adopting the Valuation Manual today, the NAIC took an important step toward a principle-based reserve (PBR) methodology for life insurance reserves. The Manual spells out the steps life insurers and regulators will take in determining principle-based reserve levels. Approval of the Manual paves the way for states to begin adoption of the Standard Valuation Model Law, which will implement PBR.

Under PBR, regulators will have access to more information about companies' risks than ever before. And appropriate reserve standards will be available for new product designs right from the inception of the design.

The Manual will continue to evolve as reserve standards are developed for new products. We welcome the opportunity to work with state insurance regulators to improve the Manual and ensure PBR enables life insurers to continue to meet their commitments to policyholders.

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