wheat66
08-08-2004, 12:48 PM
I'd appreciate advice on the definition of "Eligibility Cost" in the version of FAS106 valuation which is used in statutory accounting for insurance companies (SSAP 14). SSAP 14 says only vested benefits should be reflected. Vesting in this case means early retirement eligibilty which means eligibilty for post-ret. medical and life coverage. Effectively, your Eligibility Cost = $0 until the participant is e.r. eligible. At that time, the Eligiblity Cost = APBO (since this is effectively cliff vesting).
My question is: is the Eligibilty Cost for the year incurred for people who *are* eligible as of 1/1, or for those who are not eligible as of 1/1 but who become eligible during the current year (and so would be eligible as of 12/31). Assume the usual calendar year situation for valuation (1/1 valuation/census date, 12/31 disclosure date).
thanks for any help.
My question is: is the Eligibilty Cost for the year incurred for people who *are* eligible as of 1/1, or for those who are not eligible as of 1/1 but who become eligible during the current year (and so would be eligible as of 12/31). Assume the usual calendar year situation for valuation (1/1 valuation/census date, 12/31 disclosure date).
thanks for any help.