GAAP – Generally Accepted Accounting Principles

  • First, let me remind you of the brief history of GAAP for life insurance companies.
  • You will recall that the first exposure draft of the American Institute of Certified Public Accountants (AICPA) appeared in December, 1970.

— John H. Biggs

1976 – SOA – Trends in GAAP and Statutory Financial Statements, rsa76v2n28 – Society of Actuaries – 14p

  • 1976 – SOA – Trends in GAAP and Statutory Financial Statements, rsa76v2n28 – Society of Actuaries – 14p
  • 1984 – SOA – The Actuary, act8403 – Society of Actuaries – 8p
  • 1987 – SOA – A Comparison of Alternative Generally Accepted Accounting Principles (GAAP) Methodologies for Universal Life, by S. Michael Mclaughlin, tsa87v398 – Society of Actuaries – 46p
  • 1989 – SOA – Pricing Considerations on a GAAP Basis, rsa89v15n3a8 – Society of Actuaries – 16p
  • 2003 – SOA – VASP – GAAP for Nontraditional Long-Duration Contracts, va03-36ts – Society of Actuaries – 23p
  • 2006 – Book – US GAAP for Life Insurers, Second Edition, R. Thomas Herget, Editor – 675p
  • 2013 10 – SOA – Insurance Accounting on One Foot: Read about the differences between the FASB ED and the ED published nearly simultaneously by the International Accounting Standards Board, By Henry Siegel and William Hines – Society of Actuaries- 8p
  • Daniel F. Case
  • ATTACHMENT TWO-A
    • Financial Standards Subcommittee
    • Accounting Manual Draft – Generally Accepted Accounting Principles (GAAP) – (p20)

1988-2, NAIC Proceedings

  • The only exception to this approach was for universal life-type policies under U.S. GAAP where premium is treated as a deposit and only charges to customers are shown as revenue.

2013 10 – SOA – Insurance Accounting on One Foot: Read about the differences between the FASB ED and the ED published nearly simultaneously by the International Accounting Standards Board, By Henry Siegel and William Hines – Society of Actuaries- 8p

Accounting

  • IAS – international accounting standards for insurers
  • “natural reserve theory”
  • Journal – The Woman CPA – egrove.olemiss.edu/wcpa/
  • AICPA – American Institute of Certified Public Accountants
    • The CPA letter
  • FASB – Financial Accounting Standards Board
  • IFRS – International Financial Reporting Standards
  • 1983 – SOA – Accounting Issues for Insurance Companies, Society of Actuaries – 20p
  • 1985 – SOA – New Product Accounting Alternatives, Society of Actuaries – 26p
  • 1989 – SOA – Source-of-Earnings Analysis Under FAS 97 Universal Life Accounting, Society of Actuaries – 64p
  • 2004 – SOA – International Accounting Standards-Current Developments, Society of Actuaries – 24p
  • In this project, we studied a typical universal life (UL) contract issued in the United States.
    • We studied three alternative approaches of recognizing renewal premiums and their effect on expected earnings.
      • The first was to ignore their recognition until received.
      • The second was to recognize the amount of expected renewal premium, while the
      • third only recognized the minimum required premium level that would keep the contract in force.
    • Many actuaries wonder why this subject even needs to be discussed, as the answer seems obvious. Why is this an issue?
      • The problem is that these renewal premiums are not guaranteed; they don’t have to be paid and thus are not under the control of the insurer.
      • The definition of an asset is that it has to be under the current control of the entity. In fact, in sales illustrations, policyholders may not desire to pay a premium.

—  Sam Gutterman

2004 – SOA – International Accounting Standards-Current Developments, Society of Actuaries – 24p

  • 1991 01 – CPAJournal – Are the economics and flexibility of your joint and survivor life insurance realistic? (Personal Financial Planning), by Rubin, John – [link]
  • Other differences between statutory and generally accepted accounting principles have been recognized. Some of these are:
    • …certain assets and investments recognized under GAAP are “non-admitted” under statutory accounting practices.
      • Principal among these are certain loans and receivables, investments not authorized by statute or in excess of statutory limitations, and furniture and equipment.
    • income tax effects of differences between tax and book (statutory) accounting are not, in all cases, recognized under SAP.
      • With a few exceptions, accounting for income taxes generally is on an incurred basis.
    • the carrying value of subsidiaries is limited primarily due to restrictions in both the amount of and the amortization period for goodwill.
      • The deviations mandated or specified by the laws and regulations of the state department exercising jurisdiction result in a financial picture which presents the condition of the company or the results of its operations in conformity with the purposes and needs of the regulatory authority.
    • Financial statements prepared on the basis of generally accepted accounting principles meet the needs of a different contingency of users.  (p20-21)

1988-2, NAIC Proceedings

  • In May 1971 the Commission invited public comment on a proposal to amend certain registration and reporting forms and Regulation S-X to remove the exemption from certification of financial statements of banks filed under the Securities Act and the Securities Exchange Act and statements of life insurance companies filed under the Securities Exchange Act.54
  • After consideration of the comments received, the Commission, shortly after the end of the year, adopted amendments which removed the exemption from certification of financial statements of banks for fiscal periods ending after November 30, 1971.55
  • However, the Commission determined to retain at this time the exemption with respect to life insurance companies.
  • This will permit the accounting profession in collaboration with the life insurance industry to complete work now underway to develop and promulgate accounting guidelines for life insurance companies which will enable the financial statements of such companies to be certified in accordance with generally accepted accounting principles.  (p37)

1971 – SEC – 37th Annual Report – 250p

SAP – Statutory Accounting Principles

  • SAP, SSAP
  • 1987 – SOA – Valuation Actuary Handbook – Chapter I – Insurance Company Statutory Valuation, Society of Actuaries – 34p
  • (p7) – Eric Dinallo:  I decided that I had enough information, and enough belief in the statutory accounting, which we can talk about. Which is really part of the story. That I was going to go out there and make statements about my confidence in the insurance companies of AIG.
    • Because I did believe that on a statutory accounting basis, they had more than enough assets to match their long-term liabilities on a statutory accounting basis. Not mark to market. Which Geithner to this day …
  • YPFS: Can you talk a little bit more about that?
    • Dinallo: When Geithner heard this, I made this joke. I don’t know if I’ve been quoted.
      • I think he thought I was explaining the Mayan calendar to him. It was so alien and so weird.
      • But basically, life insurance companies have long-term liabilities, and they match it with long-term assets that are going to perform by maturing 20 years from now.
      • That’s why so much of the reserves are put towards basically debt, Treasuries, etc., that are highly rated.
        • So that they will almost certainly, hopefully, certainly perform.
        • Which means mature. You’re going to get the coupon along the way, albeit a small yield.
        • The volatility before maturation over the 20 years does not count.
      • This is the biggest debate in insurance right now.
        • Between Europe, the feds, and the United States.
          • That the inter-period where there’s volatility, and this is what I mean by, back with Shelby.
          • They were like, “Oh my god, they’re insolvent.”
          • I’m like, “They’re not insolvent. They may be, on some reporting basis, marginally insolvent.”

2021 0225 – Yale – YPFS Lessons Learned Oral History Project: An Interview with Eric Dinallo, Former New York State Superintendent of Insurance (2007-2009)  —  [BonkNote] 

  • The NYDFS recognizes only statutory accounting practices (“SAP”) prescribed or permitted by the State of New York for determining and reporting the financial condition and results of operations of an insurance company and for determining its solvency under New York Insurance Law.
  • The National Association of Insurance Commissioners (“NAIC”) Accounting Practices and Procedures Manual (“NAIC SAP”) has been adopted as a component of prescribed or permitted practices by the State of New York.
  • The State of New York has the right to permit other specific practices that deviate from prescribed practices. (p32/19)

2020 – AIG – Annual Statement for the Year 2020 OF THE United States Life Insurance Company in the City of New York – 460p

  • SSAP – Statement of Statutory Accounting Principles
    • 51 – Statement of Statutory Accounting Principles No. 51 – Life Contracts
    • Statutory Issue Paper No. 56 – Universal Life-Type Contracts, Policyholder Dividends, and Coupons – STATUS – Finalized March 16, 1998 – 12p
    • Original SSAP: SSAP No. 51; Current Authoritative Guidance: SSAP No. 51R
      • Flexible Premium Universal Life-Type Contracts
        • Alternative minimum reserves shall be required, if applicable, for flexible premium universal life-type contracts if the guaranteed maturity premium is less than the valuation net premium.
    • SSAP 86 – Accounting for Derivative Instruments and Hedging, Income Generation, and Replication (Synthetic Asset) Transactions, Supersedes SSAP No. 31 – 41p
      • SSAP No. 86-Derivatives Ref #2021-20 – Measurement of Excluded Components – 10p
  • 2021 0225 – YPFS Lessons Learned Oral History Project: An Interview with Eric Dinallo – 19p
    • Dinallo:  I decided that I had enough information, and enough belief in the statutory accounting, which we can talk about. Which is really part of the story. That I was going to go out there and make statements about my confidence in the insurance companies of AIG.
      • Because I did believe that on a statutory accounting basis, they had more than enough assets to match their long-term liabilities on a statutory accounting basis. Not mark to market. Which Geithner to this day …
    • YPFS: Can you talk a little bit more about that?
    • Dinallo: When Geithner heard this, I made this joke. I don’t know if I’ve been quoted.
      • I think he thought I was explaining the Mayan calendar to him. It was so alien and so weird.
      • But basically, life insurance companies have long-term liabilities, and they match it with long-term assets that are going to perform by maturing 20 years from now.
      • That’s why so much of the reserves are put towards basically debt, Treasuries, etc., that are highly rated.
        • So that they will almost certainly, hopefully, certainly perform.
        • Which means mature. You’re going to get the coupon along the way, albeit a small yield.
        • The volatility before maturation over the 20 years does not count.
      • This is the biggest debate in insurance right now.
        • Between Europe, the feds, and the United States.
          • That the inter-period where there’s volatility, and this is what I mean by, back with Shelby.
          • They were like, “Oh my god, they’re insolvent.”
          • I’m like, “They’re not insolvent.
            • They may be, on some reporting basis, marginally insolvent.”

Capital

  • 1981 – SOA – Effective Use of Capital, rsa81v7n14, Society of Actuaries – 26p
  • 1981 – SOA – Effective Use of Capital, rsa81v7n312, Society of Actuaries – 24p
  • 1987 – SOA – Sources of Capital for Investment and New Business, rsa87v13n318 – Society of Actuaries – 42p
  • 1990 – SOA – Capital-Raising Issues, rsa90v16n32 – Society of Actuaries – 34p
    • Bill is Executive Vice President of A. L. Williams Corporation, whose affiliate Milico has entered into a controversial commission financing transaction.
  • 1998 10 – FRBNY / AIG – Economic Policy Review – Capital from an Insurance Company Perspective, by Robert E. Lewis, Chief Credit Officer at American International Group – 3p
  • 2003 – SOA – Bringing Risk Into Capital Management, rsa03v29n124of – Society of Actuaries – 35p
  • 2008 – SOA – What Is a Robust Level of Risk Capital?, rm-essay-2008-rubin-shi – Society of Actuaries – 4p
  • 2023 – SOA – Rating Agency Perspectives on Insurance Company Capital, rating-agency-perspectives – Society of Actuaries – 28p
  • (p5) – Shelley Moore Kapito (R-WV) – Unfortunately, the consequences of Dodd-Frank are not limited to access to credit.
    • Life insurance policyholders could potentially see increases in premiums if life insurers are forced to capital levels designed for a lending institution.
    • I will continue to work with both Chairman Hensarling and Chairman Neugebauer to resolve this unintended consequence. 

2014 0723 – GOV (House-CFS) – Assessing the Impact of the Dodd-Frank Act Four Years Later – [PDF-169p,  VIDEO-CSPAN]

  • Even if we concede these differences, insurance policy holders can “run,” just differently.
    • A life insurance policy is not indentured servitude.
    • Policyholders can cash out whole life and annuity products, and halt premium payments on term products.
    • Indeed, one of the biggest life insurance failures – $15 billion Executive Life – suffered debilitating policy surrenders contributing to its failure in 1991.
  • I question the argument that insurance organizations should have weaker bank/thrift holding company protections because their insurance policy holders can’t easily cash out if they make bad investments.

2014 0310 – Letter – Sheila C. Bair to Senator Sherrod Brown (D-OH) – 6p

– Finding the Right Capital Regulations for Insurers – [PDF-105p,  VIDEO-Senate]

ALM – Asset Liability Matching

  • Let me be elementary to begin.
  • Asset/liability matching in its purest form likely means that we purchase assets such that whenever cash is needed to meet obligations, those assets will provide that cash.
  • However, in the real world, we are going to be mismatched either because
    • … we are not able to match 100% or
    • … because we make a corporate decision to be unmatched. 

—  Peter J. Bondy

1990 – SOA – Rating Agencies And Asset/Liability Matching, Society of Actuaries – 18p

  • The situation is always very fuzzy without a great deal of background knowledge as to what the value of the assets is in their case, and how it matches up against the liabilities.

—  Thomas S. Sutton, Pacific Life / ACLI

1991 0227, 0507, 0509 and 0523 – GOV (House) – Insurance Company Solvency, (CSPAN) Insurance Company Insolvencies, Cardiss Collins (D-IL)  —  [BonkNote]

  • 1985 – SOA – Actuarial Opinions On Asset-Liability Matching, Society of Actuaries – 24p
  • 1990 – SOA – Rating Agencies And Asset/Liability Matching, Society of Actuaries – 18p
  • 1994 – SOA – Asset / Liability Management (ALM): AN International Perspective, Society of Actuaries – 18p 
  • 2003 – SOA – Are We In A Different Market Paradigm?, Society of Actuaries – 7p
  • My topic is asset/liability management in the U.S., with an emphasis on the past.
  • I have been involved in the asset/liability management practice area for over ten years.
    • ALM began, in its current form, in the late 1970s or early 1980s.
    • There are many valuable lessons we can learn from history, and my purpose is to share some of those with you through some personal experiences and stories.

—  Dennis L. Carr, vice president in charge of product development and asset/liability management for the ARM Financial Group

1994 – SOA – Asset / Liability Management (ALM): AN International Perspective, Society of Actuaries – 18p 

  • When we give the liabilities a quick checklist, I would recommend the following:
    • First and foremost I think is the disintermediation risk.
      • You need to look at the financial and psychological deterrents that contract holders have to surrender their contracts.
    • Obviously a very important factor is the prevailing interest rates in the market for comparable products and for other financial instruments in general.
      • Obviously we cannot operate in a vacuum.
      • Historically credited interest rates to policyholders, particularly the existing level, is a substantial consideration.
    • Any “expectations to policyholders that may have been created.”
      • The past experience for the product and how that relates to the original pricing assumptions is also needed.
    • Product specific characteristics including embedded policyholder options in the program.

—  Allan L. Chapman, a Senior Vice President with Executive Life Insurance Company in Los Angeles

1988 – SOA – Repricing Considerations — In Force Blocks of Business, Society of Actuaries – 20p

  • Assumptions regarding long-term expected returns play a critical role in Asset/Liability Management (ALM) of financial institutions.
    • This article questions the validity of assumptions regarding long-term expected returns used by many financial institutions at the present time.

2003 – SOA – Are We In A Different Market Paradigm?, Society of Actuaries – 7p

  • We also became more aware of the exercise of policyholder options.
    • This was not just through surrenders of annuities but also through options that we thought were safe, such as policy-loan provisions in ordinary life policies with fixed interest rates of 5% or 6%.
    • I remember Sylvia Porter, the financial columnist, writing about borrowing against your life insurance at 5% or 6% fixed interest and investing in a money market account at 15% interest.
    • Insurance companies experienced a cash-flow squeeze as money flowed out through the policy-loan feature.
    • There were some company failures at this time; Baldwin United was one of the most prominent.
    • Other companies suffered lesser degrees of financial stress.

—  Dennis L. Carr, vice president in charge of product development and asset/liability management for the ARM Financial Group

1994 – SOA – Asset / Liability Management (ALM): An International Perspective, Society of Actuaries – 18p 

  • 2015 – European Parliament – Interrelation between financial stability and monetary policy at the current juncture, Monetary Dialogue – 76p
    • 2.5 Negative impact on life insurance companies
    • Conceptual issues
      • Banks’ liabilities generally have shorter maturity than their assets.
        • But life insurance companies are typically characterised by the opposite maturity mismatch.
      • Whenever the liabilities have much longer duration than assets and the return on liabilities is fixed or guaranteed, unexpectedly low interest rates can challenge profitability and solvency.
      • According to the European Insurance and Occupational Pensions Authority (EIOPA) (2014), Moody’s (2015) and Standard and Poor’s (2014), the life-insurance industry in several euro-area countries is exposed to such risks.
      • Most life insurers’ liabilities have long maturities with a guaranteed minimum return.
        • However, other (non-life) insurance products are typically not characterised by such duration mismatches and guaranteed returns and these segments of the insurance industry might not face major risks arising from persistently low interest rates.
      • Evidence
        • The mismatch between the duration of liabilities and assets held by life insurance companies is estimated by EIOPA to about 10 years in Germany, Austria and Lithuania. In  all other euro-area countries, the mismatch is smaller – about five years in Finland, France, Luxembourg and the Netherlands, while in southern Europe (Greece, Italy, Portugal and Spain) it is below two years.
          • Therefore, Germany is particularly exposed to unexpectedly low interest rates, which is a concern for financial stability.
        • According to both Moody’s (2015) and Standard and Poor’s (2014), German life insurers have some options for mitigating the negative impacts of declining investment returns, such as reducing expenses or investment returns to policyholders, diversifying their portfolios towards new asset classes, such as infrastructure and real estate, and re-pricing new sales.
        • Stress tests conducted by EIOPA underline the vulnerability of German life insurers to a prolonged period of low interest rates.
        • Recent EU (Solvency II) and specific German regulatory changes affecting life insurance providers should improve the long-term stability of the sector, but the transition during the next few years could pose special challenges if interest rates stay low.

Expense Allowance

  • Elizabeth MacGowan – Trial – Walker v Life Insurance Company of the Southwest
  • The Model Regulation specifies that the expense allowance shall be that for level premium, level death benefit endowment insurance at the maturity date.
    • The rationale for choosing a “whole life” expense allowance of this sort was thought out carefully.
    • It was felt that most of these plans were sold as a substitute for traditional forms of permanent insurance.
    • In addition, the expenses incurred in putting one of these policies on the books is comparable to plans where the whole life expense allowance is permitted.
    • Any expense allowance smaller than that for whole life would leave universal life plans at an unfair disadvantage in comparison to traditional plans of insurance.

—  Shane Chalke

1984 – SOA – NAIC Update, Society of Actuaries – 24p

  • The third area of change is the excess initial expense allowance in the Standard Nonforfeiture Law for Life Insurance.
    • This proposal adopts the recommendations set out by C.F.B. Richardson in his paper published in the Transactions of the Society of Actuaries, Vol. XXIX, 1977, p. 209.
      • [Bonk: 1977 – SOA – Expense Formulas for Minimum Nonforfeiture Values, by Charles F.B. Richardson, Society of Actuaries – 34p]
    • Briefly, the proposed amendments would change the excess initial expense allowance in the formula to reduce the minimum nonforfeiture values for most permanent policies.
      • For level-premium whole life insurance the formula for computing the exdcess initial expense allowance would be changed from 65% of the adjusted premium plus $20 per $1000 to 125% of a net level nonforfeiture premium plus $10 per $1000.
      • For non-level-premium policies, the proposal would make the initial expense allowance much less dependent on the size of the first-year premium than it otherwise would be, thereby increasing the minimum nonforfeiture values for high first-year premium policies.

—  John O. Montgomery, California

1980 – SOA – Insurance Regulation and Legislation (rsa80v6n39), Society of Actuaries – 20p

  • The initial expense allowance shall be the allowance provided by [insert reference to Section 5 or 5cA of the Standard Nonforfeiture Law for Life Insurance] for a fixed premium, fixed benefit endowment policy with a face amount equal to the initial face amount of the flexible premium universal life insurance policy, with level premiums paid annually until the highest attained age at which a premium may be paid under the flexible premium universal life insurance policy, and maturing on the latest maturity date permitted under the policy, if any, otherwise at the highest age in the valuation mortality table.
  • The unused initial expense allowance shall be the excess, if any, of the initial expense allowance over the initial acquisition expense charges as defined above.

—  Universal Life Model Regulation (MDL-585) – NAIC

  • 1956 – SOA – A New Look At The New York Expense Limitation Law, by Allen L. Mayerson, tsa56v8n2232 – Society of Actuaries – 57p
    • It has been the subject of two papers in the Transactions of the Actuarial Society of America.
      • Mr. M. A. Linton, in “Section 97–New York Law, Revision of 1929,” TASA XXX, 109, discussed the amendments to the law which were made in 1929 – <WishList>
      • Mr. Daniel J. Lyons discussed the 1948 amendments to section 213, and some of the weaknesses in the law as it then stood, in “Expense Limitations in Section 213 of the New York Insurance Law,” TASA XLIX, 27 – <WishList>
  • 1977-1, NAIC Proceedings – (p660) – ATTACHMENT 4 – Statement by Industry Advisory Committee on Art. VI, Sec. 21 – August 6, 1973 [7-?]
    • At age 25, for example, on the whole life plan the initial expense allowance provided under the Standard Nonforfeiture Law is $28 per $1,000 of coverage.
  • 1977-1, NAIC Proceedings – Initial Expense Allowance – ATTACHMENT D – Linkage of Nonforfeiture Values With Valuation Reserves – Prepared By The Society of Actuaries Special Committee on Nonforfeiture Values
  • 1978 – SOA – Adjustable Life Products (rsa78v4n33), Society of Actuaries, Moderator: Samuel H. Turner – 14p
  • 1978 – SOA – Expense Assumptions, rsa78v4n112 – Society of Actuaries – 16p
  • 1979 – SOA – Adjustable Life Expense Allowances Under The Commissioners Reserve Valuation Method [CRVM],  Society of Actuaries – 36p
  • 1982 12- AP – New York Regulation of General Agency Expense Allowances, by Scott E. Harrington, The Journal of Risk and Insurance. Vol. 49, No. 4 (Dec., 1982), pp. 564-582 – 
  • Universal Life Model Regulation (MDL-585)
  • 1977-1, NAIC Proceedings – Initial Expense Allowance
  • ATTACHMENT D – Linkage of Nonforfeiture Values With Valuation Reserves – Prepared By The Society of Actuaries Special Committee on Nonforfeiture Values
    • 6. Recommendation. Base excess initial expense allowances on levelized net premiums rather than first year adjusted premium. Reason. To produce identical excess initial expense allowances for policies with identical benefits and identical premium paying periods. Arguments and Positions. NAIC recognizes the need for special treatment of unusual products both good and bad. NAIC feels further testing of such products is needed with provision for approval or disapproval under some other section of the law such as the Fair Trade Act and disclosure legislation. Change Law Section. Section S-c.
    • 8. Recommendation. Base excess initial expense allowance on the automatic track for multi-track policies. Allow for additional initial expense allowance on increase in premium at point of increase. Reason. It would be unfair to force all companies into lowest possible expense posture to control a limited number of abuses. At time of premium increase there are additional sales and underwriting expenses. Arguments and Positions. NAIC will test examples of multi-track policies using conclusions 5 and 6. Change Law Section. Section 5-c.
    • 9A. Recommendation. Base excess initial expense allowance for life-cycle and open policies on similar approach to that used for multi-track policies with additional allowances on increases. Reason. See 8 above. Arguments and Positions. NAIC notes that individual policy pension trust and key man insurance and other kinds of policies to be considered in the open category. Change Law Section. Section 5-c.
  • The problem is that it is not possible under the CRVM method to predict a pattern of initial expense allowances because they are dependent upon the plan of insurance, premium, and age.
  • The ideas underlying an alternative are as follows:
    • The policyholder would select the level face amount and specify the initial premium which would apply for a predetermined period of, say, 10-15 years.
    • The plan of insurance would always be modified-premium whole life.
    • The Company would solve for the premium required beyond the initial period.
    • At a subsequent adjustment date, a new initial premium would be payable for a similar predetermined period beyond the date of adjustment.
    • Thus, the plan would always be modified premium whole life at issue, and there are three possible premiums — the selected premium, the completion premium, and, of course, the unscheduled premium.

1978 – SOA – Adjustable Life Products (rsa78v4n33), Society of Actuaries, Moderator: Samuel H. Turner – 14p

FASB – Financial Accounting Standards Board

  • 2016 0929 – FASB – Draft – Proposed Accounting Standards Update – 172p
    • Comments Due: December 15, 2016F
    • inancial Services-Insurance (Topic 944) – Targeted Improvements to the Accounting for Long-Duration Contracts
  • FASB – SFAS 97 – Accounting and Reporting by Insurance Enterprises for Certain Long-Duration Contracts and for Realized Gains and Losses from the Sale of Investments.
    • fasb.org/page/PageContent?pageId=/reference-library/superseded-standards/status-of-statement-no-97.html&bcpath=tff
    • 1987 – FSAB – 
    • 1989 – SOA – Pricing Considerations on a GAAP Basis, rsa89v15n3a8 – Society of Actuaries – 16p
      • First let’s talk about SFAS No. 97 and its effect on universal life contracts.
    • 1990 – AICPA – Practice Bulletin 8 – Application of FASB Statement No. 97, Accounting and Reporting by Insurance Enterprises for Certain Long-Duration Contracts and for Realized Gains and Losses from the Sale of Investments, to Insurance Enterprises – 13p
    • 2008 – FASB – SFAS 97  – Accounting and Reporting by Insurance Enterprises for Certain Long-Duration Contracts and for Realized Gains and Losses from the Sale of Investments – 20p
  • FAS 60 – June 1982 – 32p
    • aop_fas60 – 2010 – 21p
    • FAS 113:  Accounting and Reporting for Reinsurance of Short-Duration and Long-Duration Contracts
      • 2005 0406 – FASB – Minutes of April 6, 2005 Board Meeting: Risk Transfer in Insurance and Reinsurance Contracts – 5p
  • FAS 133-a
    • 20051121 – Letter – AIG to FASB – RE: Proposed FASB Staff Position FAS 133-a, Accounting For Unrealized Gains (Losses) Relating to Derivative Instruments Measured at Fair Value under Statement 133, David Herzog, AIG – 4p
  • 2006 0526 – FASB – Invitation to Comment (ITC) – Bifurcation of Insurance and Reinsurance Contracts for Financial Reporting, Applies to Policyholders, Insurers, and Reinsurers – 34p
  • 2007 – FASB – Accounting for Financial Guarantee Contracts
    • 2007 0615 – Letter – GreenLight, Einhorn to FASB – re Statement of Financial Accounting Standards, Accounting for Financial Guarantee Contracts – an interpretation of FASB Statement No. 60 – 3p
    • 2007 0620 – Letter – AIG to FASB – Statement of Financial Accounting Standards, Accounting for Financial Guarantee Contracts – an interpretation of FASB Statement No. 60 – 79 – 8p

AICPA – American Institute of Certified Public Accountants

  • 1.24  – Universal life and similar contracts are contracts with terms that are not fixed or guaranteed relative to premium amounts, expense assessments, or benefits accruing to the contract holder.

2000 0615 – AICPA – Audit and Accounting Guide: Life and health insurance entities American Institute of Certified Public Accountants. Life Insurance Audit Guide Task Force – 394p

  • During 1984, under pressure from the Securities and Exchange Commission (SEC), the Non-Guaranteed Premium Products Task Force of the American Institute of Certified Public Accountants (AICPA) Insurance Companies Committee produced an issues paper with the succinct title of
    • “Accounting by Stock Life Insurance Companies for Annuities, Universal Life Insurance and Related Products and Accounting For Non-Guaranteed Premium Contracts.” – 120p

1985 – SOA – New Product Accounting Alternatives, Society of Actuaries – 26p

  • SFAS – Statement of Financial Accounting Standards
  • AICPA – Non-Guaranteed Premium Products Task Force
  • The CPA Letter:  A Semimonthly News Report Published by the AICPA
    • 1984 – AICPA – The CPA Letter – 115p
      • The Institute recently sent two issues papers on diverse accounting matters relating to life insurance to the Financial Accounting Standards Board for consideration.
        • The first, Accounting for Key-Person Life Insurance, discusses various proposed methods of accounting by policyholders for the cost of key-person life insurance. It also discusses a proposed method of accounting for such insurance purchased to fund deferred compensation or other postemployment benefits. Because of the current diversity in practice, the accounting standards executive committee recommends that the FASB consider this matter.
        • The second paper, Accounting by Stock Life Insurance Companies for Annuities, Universal Life Insurance and Related Products and Accounting for Nonguaranteed-Premium Contracts, discusses accounting by stock life insurancecompanies for various relatively new forms of long-duration life insurance contracts.