Solvency Modernization Initiative (EX) Task Force
Executive (EX) Committee

The mission of the Solvency Modernization Initiative (EX) Task Force is to coordinate all NAIC efforts to successfully accomplish the Solvency Modernization Initiative. The Task Force will utilize the technical expertise of other NAIC groups, particularly for the five focus areas of the Solvency Modernization Initiative:

• Capital Requirements, which will be coordinated with the Capital Adequacy (E) Task Force;
• International Accounting, which will be coordinated with the Statutory Accounting Principles (E) Working Group as well as the International Solvency and Accounting Working Group that reports to this Task Force;
• Group Supervision, which will be addressed by the Group Solvency Issues Working Group that reports to this Task Force;
• Valuation Issues in Insurance, which will be coordinated with the Principles-Based Reserving Working Group that reports to this Task Force; and
• Reinsurance, which will be coordinated with the Reinsurance (E) Task Force.

2009 Charges

1. The Task Force will provide oversight to the Principles-Based Reserving Working Group and its charges to accomplish a principles-based approach to reserving.
2. The Task Force will provide oversight to the International Solvency and Accounting Working Group and its charges to perform the analysis of other countries’ solvency regulation for use in the Solvency Modernization Initiative and to identify areas for potential adoption in the U.S. solvency framework.
3. The Task Force will provide oversight to the Group Solvency Issues Working Group and its charges to identify any necessary changes to the Holding Company Model Act resulting from a study of the current model’s limitations evident in the U.S. regulatory system during the current economic crisis and/or from international initiatives related to group-wide supervision. The working group will also study the need to develop group-wide regulatory requirements, including the need for group-wide capital adequacy requirements, enhanced group-wide reporting, and consideration of non-regulated entities. In addition, the working group will recommend courses of action to improve cross-border communication and coordination (both internationally and across U.S. state borders) among supervisors, including supervisors of other financial sectors where appropriate.
4. The Task Force will monitor solvency-related work products of the International Association of Insurance Supervisors (IAIS) and assign papers to working groups to submit comments to the IAIS. Additionally, the Working Groups should review the papers and recommend whether and/or how the ideas in those papers should be implemented in the U.S. regulatory solvency system.
5. The Task Force will communicate and coordinate with the International Insurance Relations (G) Committee and provide technical support to the Committee as needed.
6. The Task Force will report the status of its work to the Executive Committee no less frequently than on a quarterly basis.