Actuarial Outpost
 
Go Back   Actuarial Outpost > Actuarial Discussion Forum > Life
FlashChat Actuarial Discussion Preliminary Exams CAS/SOA Exams Cyberchat Around the World Suggestions


Upload your resume securely at https://www.dwsimpson.com
to be contacted when our jobs meet your skills and objectives.


Reply
 
Thread Tools Search this Thread Display Modes
  #31  
Old 12-20-2017, 09:58 AM
JMO's Avatar
JMO JMO is offline
Carol Marler
Non-Actuary
 
Join Date: Sep 2001
Location: Back home again in Indiana
Studying for Nothing actuarial.
Posts: 37,428
Default

Quote:
Originally Posted by urysohn View Post
Upon reading PWC's summary (linked above), I see it is simply 92.81% of the stat reserve, which I'd not realized before.
I thought that summary seemed over-simplified. Did the law really removew all the re-computation using tax interest rates?
__________________
Carol Marler, "Just My Opinion"

Pluto is no longer a planet and I am no longer an actuary. Please take my opinions as non-actuarial.


My latest favorite quotes, updated Apr 5, 2018.

Spoiler:
I should keep these four permanently.
Quote:
Originally Posted by rekrap View Post
JMO is right
Quote:
Originally Posted by campbell View Post
I agree with JMO.
Quote:
Originally Posted by Westley View Post
And def agree w/ JMO.
Quote:
Originally Posted by MG View Post
This. And everything else JMO wrote.
And this all purpose permanent quote:
Quote:
Originally Posted by Dr T Non-Fan View Post
Yup, it is always someone else's fault.
MORE:
All purpose response for careers forum:
Quote:
Originally Posted by DoctorNo View Post
Depends upon the employer and the situation.
Quote:
Originally Posted by Sredni Vashtar View Post
I feel like ERM is 90% buzzwords, and that the underlying agenda is to make sure at least one of your Corporate Officers is not dumb.
Reply With Quote
  #32  
Old 12-20-2017, 10:12 AM
ldancer911's Avatar
ldancer911 ldancer911 is offline
Member
 
Join Date: Mar 2007
Posts: 17,235
Default

Quote:
Originally Posted by urysohn View Post
Upon reading PWC's summary (linked above), I see it is simply 92.81% of the stat reserve, which I'd not realized before.
From the link that number nerd posted:

Quote:
The conference agreement follows the Senate amendment except that, instead of 92.87
percent, the percentage relating to the statutory reserve is 92.81 percent. More specifically, the
provision provides that for purposes of determining the deduction for increases in certain
reserves of a life insurance company, the amount of the life insurance reserves for any contract
(other than certain variable contracts) is the greater of (1) the net surrender value of the contract
(if any), or (2) 92.81 percent of the amount determined using the tax reserve method otherwise
applicable to the contract as of the date the reserve is determined.
It feels like they just misstated statutory reserves in the first paragraph instead of tax reserves.
Reply With Quote
  #33  
Old 12-20-2017, 10:14 AM
urysohn's Avatar
urysohn urysohn is offline
Member
 
Join Date: Feb 2010
Posts: 16,856
Default

It did [make it just the stat reserve]. The meatier part of the bill (not the simple summary but the nuts and bolts) included "remove paragraphs 1,2,4, and 5" from 807.d, which was the section that defined tax reserves. Paragraph 2, specifically, is what modified the interest and mortality rates. The newly added sections did not mention a change in rates/mortality.
Reply With Quote
  #34  
Old 12-20-2017, 10:15 AM
urysohn's Avatar
urysohn urysohn is offline
Member
 
Join Date: Feb 2010
Posts: 16,856
Default

The "tax reserve method" as defined in Section 807 is just "CRVM" or "CARVM", not the interest and mortality used, even though that's how we tend to think of the "method"
Reply With Quote
  #35  
Old 12-20-2017, 10:29 AM
JMO's Avatar
JMO JMO is offline
Carol Marler
Non-Actuary
 
Join Date: Sep 2001
Location: Back home again in Indiana
Studying for Nothing actuarial.
Posts: 37,428
Default

Quote:
Originally Posted by urysohn View Post
It did [make it just the stat reserve]. The meatier part of the bill (not the simple summary but the nuts and bolts) included "remove paragraphs 1,2,4, and 5" from 807.d, which was the section that defined tax reserves. Paragraph 2, specifically, is what modified the interest and mortality rates. The newly added sections did not mention a change in rates/mortality.
Thank you. Good thing I'm not in charge of calculating tax reserves (or any other reserves) any more.
__________________
Carol Marler, "Just My Opinion"

Pluto is no longer a planet and I am no longer an actuary. Please take my opinions as non-actuarial.


My latest favorite quotes, updated Apr 5, 2018.

Spoiler:
I should keep these four permanently.
Quote:
Originally Posted by rekrap View Post
JMO is right
Quote:
Originally Posted by campbell View Post
I agree with JMO.
Quote:
Originally Posted by Westley View Post
And def agree w/ JMO.
Quote:
Originally Posted by MG View Post
This. And everything else JMO wrote.
And this all purpose permanent quote:
Quote:
Originally Posted by Dr T Non-Fan View Post
Yup, it is always someone else's fault.
MORE:
All purpose response for careers forum:
Quote:
Originally Posted by DoctorNo View Post
Depends upon the employer and the situation.
Quote:
Originally Posted by Sredni Vashtar View Post
I feel like ERM is 90% buzzwords, and that the underlying agenda is to make sure at least one of your Corporate Officers is not dumb.
Reply With Quote
  #36  
Old 12-20-2017, 11:40 AM
Actuary321 Actuary321 is offline
Member
 
Join Date: Sep 2001
Posts: 27,596
Default

I'll probably be monitoring this and any other tax reserve related threads. I hope those with better contacts and insights than I, will continue to post links to various industry discussions/papers/articles regarding these changes.

I already dread the times I get calls from auditors/accountants/executives asking me to discuss tax reserves.
Reply With Quote
  #37  
Old 12-20-2017, 03:17 PM
Steve Grondin Steve Grondin is offline
Member
SOA AAA
 
Join Date: Nov 2001
Posts: 6,369
Default

Quote:
Originally Posted by urysohn View Post
The "tax reserve method" as defined in Section 807 is just "CRVM" or "CARVM", not the interest and mortality used, even though that's how we tend to think of the "method"
Yes. Typically we use the word "basis" to describe the combination of method, interest, mortality, and timing (curtate/continuous/etc) that is used to compute the reserves. Although I haven't seen the actual text, it sounds as if the Federally Prescribed Reserve is being redefined as 92.81% of the stat reserve (for general account reserves).

I am curious as to why that exact number 92.81%, instead of 93% or 92%. Someone is probably interpolating between something for a revenue target.
Reply With Quote
  #38  
Old 12-20-2017, 05:22 PM
JMO's Avatar
JMO JMO is offline
Carol Marler
Non-Actuary
 
Join Date: Sep 2001
Location: Back home again in Indiana
Studying for Nothing actuarial.
Posts: 37,428
Default

Quote:
Originally Posted by Steve Grondin View Post
Yes. Typically we use the word "basis" to describe the combination of method, interest, mortality, and timing (curtate/continuous/etc) that is used to compute the reserves. Although I haven't seen the actual text, it sounds as if the Federally Prescribed Reserve is being redefined as 92.81% of the stat reserve (for general account reserves).

I am curious as to why that exact number 92.81%, instead of 93% or 92%. Someone is probably interpolating between something for a revenue target.
As I understand it, the number came out of a bipartisan committee, although the actual algorithm they used was not published, afaik.
__________________
Carol Marler, "Just My Opinion"

Pluto is no longer a planet and I am no longer an actuary. Please take my opinions as non-actuarial.


My latest favorite quotes, updated Apr 5, 2018.

Spoiler:
I should keep these four permanently.
Quote:
Originally Posted by rekrap View Post
JMO is right
Quote:
Originally Posted by campbell View Post
I agree with JMO.
Quote:
Originally Posted by Westley View Post
And def agree w/ JMO.
Quote:
Originally Posted by MG View Post
This. And everything else JMO wrote.
And this all purpose permanent quote:
Quote:
Originally Posted by Dr T Non-Fan View Post
Yup, it is always someone else's fault.
MORE:
All purpose response for careers forum:
Quote:
Originally Posted by DoctorNo View Post
Depends upon the employer and the situation.
Quote:
Originally Posted by Sredni Vashtar View Post
I feel like ERM is 90% buzzwords, and that the underlying agenda is to make sure at least one of your Corporate Officers is not dumb.
Reply With Quote
  #39  
Old 12-20-2017, 06:53 PM
Actuary321 Actuary321 is offline
Member
 
Join Date: Sep 2001
Posts: 27,596
Default

Yeah, the conference committee modified the rate from the Senate bill from 92.87% to 92.81%. WOW.

So this is tax reserves for policies issued in calendar years 2018 and beyond correct?
Reply With Quote
  #40  
Old 12-21-2017, 09:08 AM
Sleeping Dragon Sleeping Dragon is offline
Member
 
Join Date: Jun 2003
Posts: 128
Default

Quote:
Originally Posted by Actuary321 View Post
Yeah, the conference committee modified the rate from the Senate bill from 92.87% to 92.81%. WOW.

So this is tax reserves for policies issued in calendar years 2018 and beyond correct?
Someone can correct me if I am wrong, but it is inforce and new business.
Reply With Quote
Reply

Thread Tools Search this Thread
Search this Thread:

Advanced Search
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off


All times are GMT -4. The time now is 07:40 AM.


Powered by vBulletin®
Copyright ©2000 - 2018, Jelsoft Enterprises Ltd.
*PLEASE NOTE: Posts are not checked for accuracy, and do not
represent the views of the Actuarial Outpost or its sponsors.
Page generated in 3.91314 seconds with 9 queries