While many of us were getting ready for the beginning of a new school year, the NAIC was holding its Summer National Meeting in Minneapolis. A few groups scheduled meetings before the National Meeting.
Blanks Working Group – August 6, 2025
The Working Group had a very short agenda, which was easily handled in seven minutes. The group adopted proposal 2025-16 updating the Health Annual Statement Instructions actuarial section. One revision provides the prescribed language to be used when identifying the opining actuary. Additional changes in Section 7C align the health instructions with the life instructions to indicate information given meets the requirements of the domiciliary state. The revisions will be effective beginning with the annual 2026 filings. No new proposals were exposed for comment. Several editorial changes were adopted, mostly for 2025 reporting with a few items affecting 2026 reporting. The revisions were in response to small “glitches” found in items that were previously adopted or were slight enhancements to previously adopted items. (For example, adding a formula to a designated total line.) The listing will be posted on the Working Group’s webpage and should be reviewed carefully by companies to guarantee all have the same understanding of the reporting.
There is a myriad of regulatory groups that meet during the NAIC National Meetings. For the most part, the below summaries involve groups that report to the Financial Conditions (E) Committee. As the name might suggest, these groups oversee statutory financial reporting and stability, risk-based capital formulas, state analysis and examinations, solvency including group solvency, reinsurance, valuation of investments, and more. Other groups outside of E Committee oversight sometimes open issues that will eventually be filtered into the E Committee’s purview. Where possible, summaries of those activities also are included.
Now let’s look at some of the activities from the NAIC Summer National Meeting.
Financial Regulation Standards & Accreditation Committee – August 11, 2025
The Committee adopted the report of the Accreditation Scope and Alignment Working Group regarding the development and distribution of a survey to collect information from all states on their domestic insurance industry. To date, these meetings have been regulator-to-regulator, but the Working Group hopes to hold an open session later in 2025. The Committee then adopted its 2026 charges. Suggested revisions to the review team guidelines and the self-evaluation guide were exposed for comment through September 12. Revisions included guidelines for the oversight of contractors in the analysis and examination functions, new guidelines related to conflicts of interest and confidentiality protections when using contract resources, and new state reporting when submitting interim annual reviews.
Statutory Accounting Principles Working Group (SAPWG) – August 11, 2025
As a reminder, the SAPWG meetings often consist of a “hearing” for items that have been previously exposed and then a “meeting” to introduce new items, continue with deferred items, and cover other Working Group activities.
During the hearing, the following actions occurred.
| Reference # | Subject | Disposition |
|---|---|---|
| 2023-19 | Revises INT-23-03 – Negative Interest Maintenance Reserve (IMR). | Adopted, effective immediately. |
INT-23-03 was revised to extend its effective date through December 31, 2026. In addition, there were several other revisions made to the INT. The new language clarifies that the 10% limitation on admitting net negative IMR begins with the adjusted capital and surplus from the previous reporting period; however, there is a further cap of 10% of current adjusted capital and surplus. For example, at year-end, the initial calculation uses the adjusted capital and surplus from the third quarter reporting. However, it is then limited to no more than 10% of the year-end adjusted capital and surplus. In addition, companies admitting any amount of IMR must provide a disclosure and are to include the admitted negative IMR in the principle-based reserving calculation or the asset adequacy testing cash flow testing.
| Reference # | Subject | Disposition |
|---|---|---|
| 2023-14 | Deletes hypothetical IMR from Statement of Statutory Accounting Principle (SSAP) No. 7 – Asset Valuation Reserve and Interest Maintenance Reserve and the Life/Fraternal Annual Statement instructions. | See directly below. |
| 2025-03 | Establishes a definition of IMR in SSAP No. 7. | See directly below. |
SAPWG instructed NAIC staff to use the above exposed items in the forthcoming issue paper and subsequent revisions to SSAP No. 7. This is all part of a long-term project to develop concepts for IMR and capture accounting guidance in the SSAP. Along with the above, the eventual adoption of the issue paper and current “approved” revisions to SSAP No. 7 may ultimately result in further revisions to SSAP No. 7.
| Reference # | Subject | Disposition |
|---|---|---|
| 2025-02 | Revisions to SSAP No. 15 – Debt and Holding Company Obligations adopting with modification Accounting Standards Update (ASU) 2024-04, Debt – Debt with Conversion and Other Options (Subtopic 470-20), Induced Conversions of Convertible Debt Instruments. | Adopted, effective immediately. |
| 2025-09 | Provides minor revisions for consistency to SSAP No. 51 – Life Contracts as part of the coordination between the Valuation Manual (VM) – 22 with the Accounting Practices and Procedures Manual. | Adopted, effective immediately. |
| 2025-10 | Rejects ASU 2023-07, Segment Reporting (Topic 280), Improvements to Reportable Segment Disclosures as not applicable to statutory accounting. | The rejection was adopted. |
| 2025-11 | Rejects ASU 2024-03, Income Statement – Reporting Comprehensive Income – Expense Disaggregation Disclosures (Subtopic 220-40), Disaggregation of Income Statement Expenses and ASU 2025-01, Clarifying the Effective Date of ASU 2024-03. | The rejection was adopted. |
| 2025-14 | Rejects ASU 2017-05, Other Income – Gains and Losses from the Derecognition of Nonfinancial Assets (Subtopic 610-20), Clarifying the Scope of Asset Derecognition Guidance and Accounting for Partial Sales of Nonfinancial Assets, as not applicable to statutory accounting. | The rejection was adopted. |
| 2025-15 | Rejects ASU 2025-02, Liabilities (Topic 405), Amendments to SEC Paragraphs Pursuant to SEC Staff Accounting Bulletin No. 122, as not applicable to statutory accounting. | The rejection was adopted. |
| 2025-17EP | Provides editorial updates to various SSAPs. | Adopted, effective immediately. |
Remember, editorial revisions are not usually discussed prior to adoption and usually serve as clarifications. These updates were:
SSAP No. 26 – Bonds, updates the disclosure 40.f to match the maturity categories in Schedule D – Part 1A.
SSAP No. 41 – Surplus Notes, removes the reference to a “CRP” designation in paragraph 11.
SSAP No. 56 – Separate Accounts, deletes disclosure 32.d.
INT 22-01: Freddie Mac When Issued K-Deal (WI Trust) Certificates was revised to remove former SSAP No. 43R terminology.
| Reference # | Subject | Disposition |
|---|---|---|
| 2024-05 | Deletes a sentence in Appendix A-791, paragraph 2c question and answer document. | Adopted, effective immediately. |
| 2024-06 | Revisions to SSAP No. 61 – Life, Deposit-Type and Accident and Health Reinsurance and Appendix A-791 clarify risk transfer on combination reinsurance contracts with interdependent contract features. | Adopted by SAPWG and Accounting Practices and Procedures Task Force (APPTF) but delayed by Financial Conditions Committee. |
The above item has been on SAPWG’s agenda since spring 2024 and was the result of a 2023 referral from the Valuation Analysis Working Group (VAWG). VAWG found that when reinsurance treaties involved more than one type of reinsurance and there was an interdependence of the types of reinsurance (such as experience refunds based on the aggregate experience), the evaluation of reinsurance risk transfer was often done for each separate type of reinsurance. VAWG had concluded those types of reinsurance must be evaluated for risk transfer in the aggregate, not separately. For example, where a treaty includes coinsurance and yearly renewable term (YRT) with an aggregate experience refund and the inability to independently recapture the separate types of reinsurance, the coinsurance and YRT pieces should not be reviewed separately. As a result of analyzing the components separately, some companies have overstated reserve credits for reinsurance. SAPWG has revised SSAP No. 61 and Appendix A-791 attempting to rectify the situation, with an effective date of year-end 2026. Industry does not have concerns with the substance of the revisions but is asking for a different implementation. As written, the risk analysis would apply to all contracts. Industry is wanting the revisions to be prospective only, which would grandfather existing contracts. As a compromise, industry suggested application to contracts in place after January 1, 2024, reflecting the 2023 referral from VAWG. Although adopted at this meeting by SAPWG and consequently by the APPTF with application to all contracts, its final adoption was delayed by the Financial Conditions Committee. The Committee wanted more time to review the revisions and will schedule a future meeting for a final decision. A copy of the item can be found on SAPWG’s webpage under the “Documents” tab.
| Reference # | Subject | Disposition |
|---|---|---|
| 2025-01 | Clarifies in SSAP No. 21 – Leases that sale-leasebacks with restrictions on access to cash received from sale do not qualify for sale-leaseback accounting. | Re-exposed for comment ending October 17, 2025. |
| 2025-13 | Revises SSAP No. 37 – Mortgage Loans to allow residential mortgage loans held in qualifying investment trusts to be reported on Schedule B – Mortgages. | Re-exposed for comment ending October 17, 2025. |
| 2025-16 | Changes status section of an SSAP to no longer reference issue papers; and changes “substantively revised” to “conceptually revised.” | Adopted, effective immediately. |
During SAPWG’s meeting, the following activities took place.
| Reference # | Subject | Disposition |
|---|---|---|
| 2025-18 | Would adopt with modifications, certain revisions from ASU 2019-12, Simplifying the Accounting for Income Taxes, into SSAP No. 101 – Taxes. | Exposed for comment ending October 17, 2025. |
| 2025-19 | Incorporates new disclosures to identify private placement securities. | Exposed for comment through September 19, 2026. |
The above is not an accounting change, but rather suggested reporting changes. The proposal would add a new electronic column to Schedules DA, E, D – Part 1 – Sections 1 and 2, D – Part 2 – Sections 1 and 2 and BA. Not only would the fact the listed security is a private placement be indicated, but also would indicate if the security is a public security, a Rule 144A security, a Regulation D security, a Section 4(a)2 general exemption, or if the security is not required to be registered with the SEC. In addition, an aggregate disclosure would be added to the Notes to Financials indicating amount by investment schedule. If adopted, SAPWG would then submit a blanks proposal to the Blanks Working Group, with a suggested implementation date of year-end 2026.
| Reference # | Subject | Disposition |
|---|---|---|
| 2025-20 | Revisions to SSAP No. 26 – Bonds, SSAP No. 21 – Other Admitted Assets, SSAP No. 43 – Asset-Backed Securities, and Annual Statement Instructions to make disclosures for non-bond debt securities and residuals consistent. | Exposed for comment ending October 17, 2025. |
| 2025-21 | Clarifies in SSAP No. 91 – Postretirement Benefits Other Than Pensions and SSAP No. 102 – Pensions that retirement plan assets can be held at net asset value but also are to be included in the fair value disclosure. | Exposed for comment ending October 17, 2025. |
| 2024-21 | Eliminates the investment subsidiary concept from the Annual Statement Instructions. | Exposed for comment ending October 17, 2025. |
This also is more of a reporting issue than an accounting issue. Although the original concept of investment subsidiaries was included in SSAP No. 46 (which has since been nullified and replaced), that concept was deleted in 2025 in SSAP No. 88 (the replacement for SSAP No. 46, but which also has been nullified and replaced). SSAP No. 97, Investments in Subsidiary, Controlled and Affiliated Entities, replaced SSAP No. 88 but continued to have no concept of an investment subsidiary. However, the investment subsidiary concept was not eliminated in the annual statement instructions, nor from the Life RBC formula. This proposal recommends edits to Schedule D – Part 6 – Section 1 in the annual statement. If adopted, a referral also would be sent to the Life RBC Working Group to eliminate the corresponding RBC instructions. This change does not prohibit companies from owning investment subsidiaries but updates the reporting of such entities.
The Working Group heard updates on the activities of the IMR ad hoc group and noted that it will be holding an open meeting on September 10, 2026 for the discussion of asset liability matching derivates. The group received a referral from the Life RBC Working Group regarding AVR equity reporting lines for common stock in subsidiary, controlled, and affiliated investments and other affiliates. The Life Actuarial Task Force provided a coordination memorandum noting two items that it will need to coordinate on with SAPWG. Staff provided an update on U.S. GAAP activities.
Reinsurance Task Force – August 11, 2025
After adopting its 2026 charges, with no changes from the current charges, the Task Force adopted the report of the Reinsurance Financial Analysis Working Group. That Working Group reported it had reviewed and approved 101 reciprocal reinsurers and 47 certified reinsurers. The Task Force then received a status report from the Mutual Recognition of Jurisdiction Working Group. The conversation then turned to other NAIC ongoing projects that affect reinsurance. The meeting ended with a discussion of a proposal to allow ceded unearned premium reserve surety bonds to be used as collateral for unearned premium reinsurance. No action on that issue was taken at this time.
Aggregation Method (AM) Implementation Working Group – August 11, 2025
As a reminder, this Working Group was formed to assist U. S. internationally active insurance groups with the U.S. implementation of the Insurance Capital Standards (ICS) via the aggregation method. The group will coordinate the U.S. implementation and then monitor any further ICS development.
The group adopted a recommendation to use Excess Relative Ratio (ERR) scalars in the aggregation method. (This recommendation was later adopted by the International Insurance Relations Committee via the adoption of this group’s meeting minutes.) The ERR is the same scalar currently used in the Group Capital Calculation.
Capital Adequacy Task Force – August 12, 2025
The Task Force adopted the reports of its following Working Groups:
- Heath Risk-Based Capital (RBC) Working Group
- RBC Investment Risk and Evaluation Working Group
- Life RBC Working Group
- Property and Casualty RBC Working Group
Activities of these groups have been detailed in previous editions of this NAIC summary. None of the Working Groups met during the national meeting. The Task Force then adopted the content for the RBC newsletters for all the RBC formulas. The newsletter accompanies the release of the formulas each year and will be posted on the Working Groups’ webpage. Attention then turned to the Preamble to the RBC formulas. This project has been in the works for some time and had been previously released for comment. During a previous meeting, it had been pointed out that much of the discussion, both pro and con, that occurred in crafting the suggested revisions had not been provided to the public. Therefore, the chair made available unofficial notes of the RBC Purposes and Guidelines Ad Hoc Group as part of this meeting’s material, while also providing a summary of those actions. The Task Force will schedule a call in October for more discussion and possible finalization of the Preamble revisions. In the meantime, the group will accept more comments but does ask that those commenting also submit “red-lined” specific recommended language changes, if any.
RBC Model Governance Task Force – August 12, 2025
As one of the new kids on the block in the regulatory RBC regime, this Task Force is still trying to formulate preliminary principles. To accomplish that, and other following activities, Bridgeway Analytics (Bridgeway) was hired as the consulting firm to work with the Task Force. In addition, the Task Force will utilize an ad hoc group of state regulators. This meeting concentrated on comments received from previous exposures of the principles. Bridgeway opened the discussion of comments received by summarizing the comments in general terms. Each submitting organization also was given the opportunity to provide a brief verbal summary of its comments. Sixteen organizations, including four departments of insurance, submitted comments.
Regulator comments were critical of some of the principles as “overreaching” with some suggested principles being outside of the intent of RBC. On many issues, industry agreed with the regulators. In particular, most comments indicated that RBC should remain solvency-related only, identifying companies that are weakly capitalized. Secondary goals such as acknowledging RBC impact on product availability to meet consumer needs should be eliminated. The consensus is that secondary goals not only fall outside of the sole purpose of the RBC, but it also remains unclear how such “acknowledgment” could be conceptualized within the formulas. As the next steps to crafting the principles, Bridgeway will take the comments and redraft the document.
Accounting Practices & Procedures Task Force – August 12, 2025
The meeting began with the adoption of the group’s 2026 charges, which were unchanged from last year. The Task Force then adopted the minutes of the Blanks Working Group and SAPWG. However, SAPWG item 2024-06, Risk Transfer Analysis of Combination Reinsurance Contracts, was pulled out of the SAPWG minutes for a separate adoption vote. Based on the discussion that took place in the SAPWG meeting, this action was not unexpected. After some discussion, the Task Force adopted 2024-06. (See the SAPWG summary for more details on this agenda item.)
Big Data & Artificial Intelligence (AI) Working Group – August 12, 2025
In May, the Working Group had released for comment a request for information (RFI) proposing a NAIC model law on the use of AI in the insurance industry. During this meeting, the group heard comments received on the RFI. The group received 33 written comments from various individuals and groups, including state departments of insurance. Comments varied widely. The Working Group indicated that the comments helped it to understand different perspectives on the subject. It will use those insights to determine the next steps in developing a possible AI model law. The discussion then turned to the next steps in the development of an AI systems evaluation tool. In July, the Working Group had released the initial draft of the tool for comment through September 5, 2025.
Valuation of Securities Task Force (VOSTF) – August 12, 2025
The following actions were taken for revisions to the Purposes and Procedures Manual (P&P Manual) of the NAIC Investment Analysis.
| Subject | Disposition |
|---|---|
| Revisions indicating that private letter rating (PLR) rationale reports are due within 90 days of an annual update or rating change. | Adopted. |
| Language provides that PLR rationale reports must contain analytical substance. | Adopted. |
| Corrections of two sections of the P&P Manual regarding caps on NAIC designations of CRP-rated securities. | Adopted. |
This correction to previously adopted revisions that replaced the concept of “credit risk” with the concept of “investment risk” was needed. In the original revisions, the adopted wording inadvertently stated the inverse of what was meant. Although the correction was adopted, NAIC staff was directed to look for possible other sections where the same type of correction may be needed.
| Subject | Disposition |
|---|---|
| A proposed amendment allowing a 30-day grace period for providing the PLR annual updated. | Exposed for comment through September 12, 2025. |
| Prepare a referral to the Blanks Working Group to recommend a new column to verify the reported CUSIP/CINS/PPN/ISIN numbers in statutory reporting. | NAIC staff to prepare the formal referral, which will then be exposed for comment. |
The above referral is the result of the NAIC integrating Standard and Poor’s Global Instruments Cross Reference Service into its systems. The addition of this additional field will more easily allow for the verification of identification (ID) information of an insurer’s investments by way of a new column to identify whether the reported ID is a CUSIP or CINS (C) number, and an ISIN (I) number or a PPN (P) number.
Reports were then received from various other NAIC activities involving investments. The Structured Securities Group (SSG) indicated it has the modeling of collateralized loan obligations (CLOs) ready to use for year-end reporting. However, because of other groups also addressing CLO issues, the SSG feels implementation needs to be delayed another year. NAIC staff was directed to prepare and expose for a 30-day comment period a P&P Manual amendment changing the effective date for the modeling of CLOs to 2026. SAPWG reported on its latest investment activities. The Task Force chair called attention to the fact that three different rating agencies have slightly downgraded the U.S. government’s credit rating. Although government securities will continue to carry an NAIC designation of 1A at this time, the situation will be closely monitored. The final update heard concerned the development of a credit rating provider rating due diligence framework. PricewaterhouseCoopers has been hired to design the framework.
Executive Committee – August 12, 2025
This meeting was straightforward. The Committee adopted the report of its joint meeting with the Internal Administration (EX1) Subcommittee, as well as reports from the Climate and Resiliency Task Force, the Government Relations Leadership Council, and the RBC Model Governance Task Force. The Committee received reports from the National Insurance Producer Registry (NIPR) and the Interstate Insurance Product Regulation Commission (Compact).
Financial Conditions Committee – August 13, 2025
The Committee adopted the reports of its various task forces and working group, thus finalizing actions taken by those groups. As expected, the Committee pulled out SAPWG’s item 2024-06: Risk Transfer Analysis of Combination Reinsurance Contracts for separate consideration and adoption. The Committee decided not to act upon this item but will be scheduling a separate meeting after members of the group have reviewed this issue. (See details of the proposal in the SAPWG summary.)
Verbal status reports were received from the VOSTF and the RBC Investment Risk and Evaluation (RBCIRE) Working Group on investment projects. VOSTF verbally summarized what was already included in its adopted written minutes. The RBCIRE provided an update on the CLO project the American Academy of Actuaries (Academy) is working on, indicating it will have an update call with the Academy in September. RBCIRE also is creating a timeline for 2026 CLO implementation in the Life RBC.
The Committee established a new working group, the Reciprocal Exchange Working Group, and adopted a request for a revision to the Insurance Holding Company System Regulatory Act (#440) and/or the Insurance Holding Company System Model Regulation with Form and Instructions (#450) to clarify that reciprocal exchanges are subject to the model’s fair and reasonableness standards. The request will now be sent to the Executive Committee for further approval. A proposal to reorganize the Risk Retention Group Task Force into a working group and add the ability of the new working group to meet in regulator-to-regulator meetings was adopted. The change becomes effective January 1, 2026.
As a follow-up to this meeting, on August 19, 2025, the Committee released for comment the 2026 charges for the Committee and the working groups that report directly to it. The exposure period is through October 2, 2025. Task forces reporting to the Committee will have their 2026 charges released for comment at a later date.
Joint Meeting of the Executive Committee & Plenary – August 13, 2025
Although not always the highlight of the National Meeting, this meeting always signals the end of the NAIC National Meeting. The group received reports from its “lettered” committee. As required, a super majority vote adopted amendments to the 2026 Valuation Manual. Also adopted was Actuarial Guideline LV—Application of the Valuation Manual for Testing the Adequacy of Reserves Related to Certain Life Reinsurance Treaties (AG 55) and the NAIC Catastrophe Modeling Primer.
Regulator-Only Meetings
The NAIC National Meetings provide a somewhat rare opportunity for state regulators to meet face to face. Regulator-only meetings are held when discussions will include information about specific companies/organizations or where internal or administrative matters of the NAIC or its members are being discussed. Most groups holding regulator-only meetings also hold open public meetings.
The following groups held regulatory-only meetings:
- Financial Analysis Working Group
- Joint Meeting of the Executive Committee and Internal Administration Subcommittee
- Chief Financial Regulator Form
- Valuation Analysis Working Group
- NIPR Board of Directors
- Financial Examiners Coordination Working Group
- Receivership Financial Analysis Working Group
- Market Actions Working Group
- Financial Regulation Standards and Accreditation Committee
- Commissioners’ Roundtable
- State Insurance Department Attorneys’ Roundtable
- Northeast Zone Meeting
- Southeast Zone Meeting
- Midwest Zone Meeting
- Western Zone Meeting
- SBS Overview and Partnerships – NIPR
- Antifraud Task Force
- State Insurance Department Legislative Liaison Roundtable
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