It’s hard to believe, but it’s been eight years since the Society of Actuaries (SOA) started the General Insurance (GI) Fellowship specialty track. In 2019, the SOA’s GI track was recognized as a National Association of Insurance Commissioners (NAIC) Accepted Actuarial Designation, meeting NAIC standards of a qualified actuary to sign the NAIC Property & Casualty (P&C) Annual Statement of Actuarial Opinion (SAO).1 It was a comprehensive process to get to that point, and it involved the work of NAIC staff and many volunteers representing the SOA, the Casualty Actuarial Society (CAS) and the American Academy of Actuaries (the Academy). The NAIC made all organizations equal participants in the process to ensure the highest quality educational standards needed for a U.S. P&C Appointed Actuary were met.
Why GI and not P&C?
A question we often hear is: Why do you call it general insurance (GI) and not property and casualty insurance (P&C)? It’s a good question. For those in North America, we are more familiar with the term P&C. But that is not the term used for this field of insurance in other parts of the world.
The SOA is a global organization, so it was important to view the naming of this track in this context. This field of insurance is referred to as GI by actuarial societies in Australia, India, Singapore, South Africa and the United Kingdom.
There is a third option to describe this field of insurance: non-life (N-L). This is the term used by the International Actuarial Association (IAA) and the actuarial society in Japan.
Each of the three terms has shortcomings. GI is vague, as it almost sounds like “insurance, in general.” P&C is too limiting, as the field is more than just property and casualty coverages. And N-L is too broad, as there are some types of insurance that are not life insurance and not considered part of the GI field (e.g., health insurance).
GI was selected by the SOA because there is no perfect term, and GI appears to be the most globally used term.
When the SOA started the SOA GI track, it was developed with a focus on serving the international actuarial community. So, you may be wondering why the SOA views NAIC recognition as important. The SOA must support its membership wherever they practice. Having NAIC recognition is necessary for U.S. members and international members who may work in the United States. Beyond this, the SOA needed to ensure that the GI track was consistent with the SOA’s other tracks. A fellow in the Life track may sign the NAIC Life SAO, a fellow in the Health track may sign the NAIC Health SAO, and now, following the NAIC SOA GI track recognition, a fellow in the GI track may sign the NAIC P&C SAO.
Another important factor to consider regarding NAIC recognition is that international regulators often look to what happens with U.S. insurance regulation, and the favorable NAIC decision likely will be a positive consideration for international regulators when reviewing possible updates to their specific laws and regulations for actuaries, particularly those practicing in general insurance. However, international laws and regulations vary from country to country, and the SOA is seeking clarification in countries that need updates to legislation to recognize the SOA GI track.
Recognition by the NAIC was great news for the GI track, and the SOA is now following up on this positive outcome in various states. The NAIC is not the insurance regulator in the United States. It creates model laws that the individual state departments of insurance bring to reality. As a result, the laws and regulations vary from state to state. Some states have laws and regulations that automatically reflect the revised NAIC P&C SAO instructions that recognize the SOA’s GI track. Some state laws require updates to reflect this revision. The SOA is now working with the departments of insurance in those states that require updates.
TIMELINE FROM CREATION OF GI TRACK TO NAIC APPROVAL
SOA Board of Directors approves the creation of an educational track in P&C insurance, which was named the General Insurance Fellowship track.
SOA begins development of the GI track curriculum and recruitment of volunteers.
SOA hires two P&C actuaries as staff fellows for GI.
SOA approaches both the Academy and the NAIC with regard to having the SOA’s GI track be accepted as meeting the Specific Qualification Standards of the basic education requirement for signing the Statement of Actuarial Opinion, NAIC P&C Annual Statement.
SOA publishes the textbook Fundamentals of General Insurance Actuarial Analysis, by Jacqueline Friedland FSA, FCAS, FCIA.
The Academy concludes the NAIC should review the SOA’s GI track to determine if it should be an accepted designation.
SOA administers the first GI track exam.
The SOA submits detailed information on the GI track to the NAIC for approval.
SOA publishes the textbook General Insurance Financial Reporting Topics.
The first FSA is awarded through the SOA’s GI track.
NAIC conducts a survey for a job analysis of the U.S P&C Appointed Actuary.
NAIC produces a list of knowledge statements denoting the requirements of a qualified U.S. P&C Appointed Actuary.
NAIC appoints subject-matter experts to assess the SOA GI track and the CAS exams to determine if there is appropriate coverage of the knowledge statements.
NAIC concludes the SOA’s GI track is an NAIC Accepted Actuarial Designation, meeting NAIC standards of a qualified actuary in general insurance.
- 1. Pending modest agreed-upon updates to the GI track curriculum. These changes were made in time for the SOA’s Fall 2019 Exams. Also, an FSA in the GI track must elect the two-hour Advanced Topics in General Insurance Exam and the U.S. version of the five-hour Financial and Regulatory Environment Exam. ↩
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