Liquidation Belth FRB Valuation Loans

MR. BELTH: Before you sit down, John, let me ask you a question.

Rumor has it that there were some extensive discussions between highly placed life insurance officials and officials of the Federal Reserve in April, 1980.
Would you care to discuss exactly what the nature of those conversations was?

MR. BOOTH <ACLI>: I was not present.

There were some discussions; as you know, in the Spring there was a policy loan crunch.
There have been discussions held periodically as far back as 15 to 20 years.

MR. BELTH: I raise the question whether the disintermediatlon problem could conceivably become so serious as to threaten the viability of the life insurance industry and force some kind of unilateral governmental action in order to save, or literally bail out, the industry.

One incident that I recall which somehow has been blacked out of most textbooks was when the NAIC (it was then the NCIC) allowed life insurance companies to change their valuation rules for just one year.
Was it 1932?

1981 - THE LIFE INSURANCE BUSINESS---THE VIEW OF CONSUMERISTS, Society of Actuaries (rsa81v7n38)

Further Resolved, That inasmuch as a number of worthy industrial and commercial corporations are in emergency receivership and a number of corporate bonds are in default as to interest and/or principal by reason of lack of liquidity rather than by reason of lack of underlying value, stocks of corporations in receivership and bonds in default should be valued on the 1931 Convention basis less 30 per cent of the difference between such Convention value and the exchange quotation as of December 1, 1932, unless the value underlying such securities has been heavily depleted or has disappeared to such an extent that a lower value is required by reason of such special circumstances. (p8)
The Committee on Valuation of Securities

1933-1 volume only, NAIC/ NCIC