Traditionally, July NAIC activity increases in preparation for the NAIC Summer National Meeting held in August. This July was no exception, as groups that would not be meeting at the Summer Meeting needed to conclude business so their parent groups could act accordingly.
Financial Conditions (E) Committee – July 8, 2026
It is unusual for this group to meet just prior to an upcoming NAIC National Meeting. However, since all of the agenda items were Risk-Based Capital (RBC) related, the assumption was the Committee wanted all things RBC finalized in July. Accordingly, actions included the adoption of a revised RBC Preamble, proposal 2026-12-IRE establishing 2026 factors in the Life/Fraternal RBC formula for collateralized loan obligations (CLOs), and 2027 factors for the Life Fraternal RBC for collateralized loans.
Joint Meeting of Property/Casualty RBC Working Group & Catastrophe Risk Subgroup – July 9, 2026
Items to be included in the 2026 Property/Casualty RBC newsletter were approved for publication. The newsletter will be part of the RBC package distributed later this year by the NAIC. The Working Group reviewed aggregate statistics from the 2025 Property/Casualty RBC filings. The statistics will be posted to the Working Group’s webpage under the Documents tab. The subgroup provided an update on the severe convective storm impact analysis and introduced proposal 2026-13-CR, which would implement convective storm risk in the 2027 formula. The proposal was exposed for a 61-day comment period ending September 8, 2026.
Health RBC Working Group – July 15, 2026; July 22, 2026 via email
The Working Group reviewed aggregate statistics from the 2025 Health RBC filings. The statistics will be posted to the Working Group’s webpage under the Documents tab. Items to be included in the 2026 Health RBC newsletter were approved for publication. The newsletter will be part of the RBC package distributed later this year by the NAIC. In previous meetings, there has been a lot of discussion concerning the American Academy of Actuaries’ (Academy) work in developing new factors for use in the underwriting risk. In those discussions, industry had been critical of the data years being used by the Academy. As a result, the Academy updated the data years to be inclusive through 2025. The RBC updating will include work on the managed care credit and possibly incorporate product diversification credits. Recent comment letters regarding possible other data analysis were discussed. One of the main themes of the comment letters was the industry’s request for a phase-in period for new factors. The chair acknowledged that the Working Group needs to set a formal time horizon for the implementation of the factors, including a decision on a possible phase-in. The next topic of discussion was Medicaid pass-through and state payment rule changes, which will change coverage from a non-risk program to a risk program. More discussion regarding possible related RBC changes will occur in the future. The Working Group will not meet at the upcoming NAIC Summer National Meeting.
On July 22, the group released for comment a draft memorandum to the Academy requesting development of a diversification credit within the formula. The request is the result of comments received from industry asking for the development and implementation of a diversification credit for lines of business reported on page XR013 in the Health formula. (If implemented, the diversification credit would also apply to page LR020 in the Life RBC formula and page PR020 in the Property/Casualty RBC.) The exposure has been posted to the Working Group’s website under the Exposure Drafts tab, with the exposure period ending August 21, 2026.
NAIC/American Institute of Certified Public Accountants (AICPA) Working Group – July 16, 2026
One of the main charges of this group is to annually determine if the premium threshold stated in the Model Audit Rule (MAR) for the Management’s Report of Internal Controls is being met. At least 90% of the U.S. insurers’ premiums must be subject to the report on Internal Controls or are SOX compliant. Based on December 31, 2025 annual statement filings, 94.3% of U.S. insurers are subject to this requirement; therefore, no adjustments need to be made to the premium threshold. The AICPA then presented changes that had been made to the definition of a public interest entity. Although the definition does include insurance entities, the AICPA professional ethics committee defers to the relevant U.S. regulators for purposes of the specific independence requirements of audits.
Life RBC Working Group – July 16, 2026
After adopting minutes of its Spring National, April, and June meetings, as well as meetings of the Generator of Economic Scenarios (GOES) Subgroup and the Longevity Risk Subgroup, the Variable Annuities Capital and Reserve Subgroup was disbanded. The Working Group reviewed aggregate statistics from the 2025 Life/Fraternal RBC filings. The statistics will be posted to the Working Group’s webpage under the Documents tab. Items to be included in the 2026 Life/Fraternal RBC newsletter were approved for publication. The newsletter will be part of the RBC package distributed later this year by the NAIC. Attention then turned to a referral to the Statutory Accounting Principles Working Group (SAPWG) regarding the reporting of Schedule BA collateral loans. The referral summarizes adoption of 2025-16-L, requests additional disclosures in the annual statement covering independent verification of collateral fair values, and requests updated annual statement instructions for the handling of collateral loans backed by mortgage loans in the Asset Valuation Reserve. After a discussion of the GOES C-3 field test specifications and C-3 alignment, the field test information was exposed for a 14-day comment period ending July 30, 2026. The formal exposure included materials that were shared during the meeting but not included in the provided meeting material. The specifications and instructions had been revised based on comments and questions received from a previous exposure period. The field test is planned for the September/October time frame. The Working Group will not meet at the August NAIC Summer National meeting.
Reinsurance Task Force – July 20, 2026
Since the Task Force will not meet at the upcoming NAIC Summer National Meeting, it used this meeting to adopt its previous meeting minutes, adopt the report of the Reinsurance Financial Analysis Working Group, and receive a status report from the Mutual Recognition of Jurisdictions Working Group. The group received an update on Actuarial Guideline 55 reviews resulting from revisions adopted by the NAIC last year. Reviews are still in the early stages with the process addressing prioritized companies first. There have been no conclusions at this point, as the reviews are focused mainly on observations to gain a better understanding of the various results. The chair summarized ongoing projects of the Task Force, while NAIC staff summarized other ongoing NAIC projects that may have an impact on reinsurance.
Joint Meeting Group Solvency Issues Working Group & Own Risk & Solvency Assessment (ORSA) Implementation Subgroup – July 23, 2026
The main purpose of this meeting was to discuss revisions to the ORSA Guidance Manual for 2026. Suggested revisions had previously been exposed for a comment period. Based on the comments received, the Subgroup had incorporated additional revisions. The Subgroup reviewed and discussed the new revisions and then the Subgroup adopted the revisions. The Working Group also then adopted the revisions. There are several areas of contention between the adopted version and industry, including “allocation” of group capital to each material risk classification or category and the new filing time frame. Although it was decided that several areas should be discussed further in the future, the adoption proceeded as revised for 2026. Companies should review the new manual carefully. Work on the 2027 guidance manual will begin in September.
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