CIA.Valn
Reading: “Educational Note: 2021 Guidance to the Appointed Actuary for Property and Casualty Insurers,” September 2021.
Authour: Canadian Institute of Actuaries
Contents
Pop Quiz
- From the DCAT reading, identify 7 common ripple effects, and 5 common management actions for adverse scenarios. (We'll refer to these in this article)
Study Tips
An older version of this wiki article has been archived under the name CIA.Valn2020.
This reading is updated every year because it highlights changes that have been made to other readings. For example, it mentions recent changes that were made to Financial Condition Testing but these were already discussed in detail in the wiki article CIA.FCT-1. This year's update is very minor.
If you check the BattleTable below, you'll see that the only available exam problem from this reading covered IFRS 17, but that was when there were no other IFRS 17 readings on the syllabus. Now there are 6 IFRS 17 readings on the syllabus and everything you need to know is available from those.
If there's going to be a question directly from this reading, I think it would most likely be from the section on COVID19.
Estimated study time: 5 minutes
BattleTable
reference part (a) part (b) part (c) part (d) E (2018.Fall #28) IFRS 17: 1
- actuarial liabilities
- 1 This question is outdated because the IFRS 17 material from that reading has been removed from the syllabus. The IFRS 17 material is now covered in much more detail in CIA.IFRS17. Even though the new reading covers the above question, it does so in a different way. That means the answer in the examiner's report is probably not relevant anymore. You should base your study of IFRS 17 on the new reading, CIA.IFRS17.
In Plain English!
2020.Fall Updates
As I mentioned above, if there's going to be a question directly from this reading, I think it would most likely be from the section on COVID19. Most of the discussion was general in nature - that actuaries should consider the impact of COVID19 when performing actuarial functions. The only specific piece of (possibly) testable information I could find was this:
- The Ontario government passed Bill 218 Supporting Ontario’s Recovery Act, 2020, which may affect medical and other professional liabilities.
If you were asked to identify an example of a government intervention regarding COVID19 and any potential effects, I would quote the above bullet point. There is an additional section on Emerging Issues. It is general in nature and states that the actuary should consider the impact of the following when performing actuarial work:
- product reforms
- judicial, legislative, political events
- catastrophic events
- climate change
Those are all pretty obvious, and a brief discussion on climate change has been added to the CIA.FCT-2 wiki article anyway.
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POP QUIZ ANSWERS
- 7 common ripple effects:
higher LR (higher losses or operating costs) loss of ReIns post-event inflation forced sale or liquidation mix shift PH actions (PH = Policyholder) regulatory action
- 5 common management actions:
tighten U/W raise rates review reinsurance sell assets review mix (geography, limit,...)
