- Froogled By:
- Elias Makere, FSA, MAAA
- Last Froogled:
ASOP 2 | §1.2 | SCOPE
Throughout this standard, the term “determination” includes both the initial determination at policy issue and subsequent determinations for in-force policies.
The standard also applies to actuaries when performing similar actuarial services for group master contracts with individual certificates where NGEs are determined in a similar manner to products written on individual life and annuity policy forms. Examples of products within the scope of this standard include universal life, indeterminate premium life, and deferred annuity products. Such products may be fixed, variable, or indexed.
Actuarial services for group products with NGEs that are not determined in a similar manner to those written on individual life and annuity policy forms are not in scope. Two examples are traditional group term life insurance and certain retirement funding products (for example, synthetic guaranteed interest contracts). To the extent that actuarial services for a product do not clearly fall into the scope, the actuary should use professional judgment to determine whether the services are in scope.
This standard does not apply to actuaries when performing actuarial services with respect to policyholder dividends, which are covered by ASOP No. 15, Dividends for Individual Participating Life Insurance, Annuities, and Disability Insurance. To the extent that a product involves both NGEs and policyholder dividends, this standard applies to actuaries when performing actuarial services with respect to NGEs, and ASOP No. 15 applies to actuaries when performing actuarial services with respect to policyholder dividends.
This standard does not apply to actuaries when performing actuarial services with respect to the determination of any reinsurance contract elements that are not guaranteed in a reinsurance contract.
This standard does not apply to actuaries when performing actuarial services with respect to illustrations of NGEs subject to ASOP No. 24, Compliance with the NAIC Life Insurance Illustrations Model Regulation.
If the actuary departs from the guidance set forth in this standard in order to comply with law (statutes, regulations, and other legally binding authority), or for any other reason the actuary deems appropriate, the actuary should refer to section 4. If a conflict exists between this standard and applicable law, the actuary should comply with applicable law.
ASOP 2 | Commentary Section 1.2 | COMMENT ON SECTION 1.2
| Comment | Response |
|---|---|
| One commentator suggested adding language to clarify that the ASOP is not retroactively applicable to prior determinations before the effective date of the ASOP. | The reviewers clarified the language. |
| One commentator suggested moving the sentence “Throughout this standard, the term determination includes both initial determination and subsequent redeterminations” to section 1.1. | The reviewers disagree and made no change in response to this comment. |
| One commentator suggested adding “to the extent possible” when referring to future determinations of in-force products after the effective date to provide sufficient flexibility. | The reviewers believe the guidance is appropriate and made no change in response to this comment. |
| One commentator noted that ASOP No. 15, Dividends for Individual Participating Life Insurance, Annuities, and Disability Insurance, does not appear to define “dividend” and suggested adding a definition to ASOP No. 2. | The reviewers disagree with the suggestion and made no change in response to this comment. The reviewers note that section 2.4 states “For the purpose of this ASOP, an NGE reflects expectations of future experience as opposed to, for example, a dividend, which reflects participation in past experience.” |
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