COPLFR Updates Archived 2021.01.02

The COPLFR reading was updated for the 2019.Fall sitting, but there were no significant changes. Spend 5 minutes reading the information below and you'll be good to go.

Fall 2019 Updates (also valid for Spring 2020)

Section 1: Introduction

(1.6)

Copied directly from the source text:

• ...changes were relatively minor, and intended to provide more clarity through illustrative language, improve readability, and fix minor errors.
• COPLFR also reflected all changes to NAIC SAO and AOS Instructions and considered the updates to AOWG’s Regulatory Guidance document. (Significant changes in this year’s practice note are highlighted in yellow.)

The highlights refer to the COPLFR document (not the wiki.) It was very helpful of the authors to insert these highlights - it makes it easy to scan the document for changes. In any case, the source text goes on to say:

• The 2018 NAIC SAO Instructions include changes regarding Accident & Health (A&H) Long Duration Contracts but otherwise have not had any substantive changes since 2017.

This is great news. There are then 3 more bullet points that outline the specific changes:

• A definition has been introduced for A&H Long Duration Contracts as “A&H contracts in which the contract term is greater than or equal to 13 months and contract reserves are required.”16 We note that this is different from the definition of Property and Casualty (P&C) Long Duration Contracts.
• Exhibit B: Disclosures have changed with the addition of Item 13: Net Reserves for A&H Long Duration Contracts.
• The prior term “Long Duration Contracts” was revised to “Property and Casualty (P&C) Long Duration Contracts”. There was no change in procedures for these types of contracts. COPLFR understands that this was a clarifying change to make clear the distinction between P&C Long Duration Contracts (i.e., those subject to the three tests of SSAP No. 65) and the new term “A&H Long Duration Contracts.”

Conclusion

I scanned the source text for the yellow highlights and it does seem the updates are minor. Basically 99% of the material is unchanged from the prior version. (Remember that since the Statement of Actuarial Opinion is the top-ranked topic, you should be actively using the source text, the examiner's reports, and the wiki as you're learning the material.)