National Association of Insurance Commissioners (NAIC) Reminds Insurers Of Change In Data Collection Requirements for 2012 Property Risk-Based Capital Report
Nov 14, 2012
At the suggestion of various trade associations, for each insurer that filed a Property Risk-Based Capital (“RBC”) report for year-end 2011, the National Association of Insurance Commissioners (“NAIC”) is advising companies’ Annual Statement and RBC contacts about a change in data collection requirements for the year-end 2012 Property RBC report in order for them to take the necessary steps to begin compiling this data.
The NAIC’s Capital Adequacy Task Force approved changes to the 2012 Property RBC report on June 12, 2012 requiring that catastrophe losses by annual statement Schedule P line of business be provided in the confidential Schedule P RBC filings, pages PR100+.
Catastrophe losses are cumulatively incurred to-date net losses only (no expenses) as of December 31, 2012 for accident years 2003 through 2012, as well as total net catastrophe losses unpaid as of December 31, 2012. A “catastrophe” is defined for this purpose as arising from events numbered and labeled by PCS® (Property Claim Services) as a hurricane, tropical storm, or earthquake.
The data will be collected via two additional columns in the existing Schedule P Part 1 confidential filings. The requirements for the data to be reported in the existing columns have not changed; that is, net earned premiums, net losses and expenses unpaid, and net losses and expenses incurred by line of business should continue to be reported as per existing requirements. (Please refer to the attached “Frequently Asked Questions” document for more information.)
The NAIC has specified that this data is for informational purposes only at this time and is intended to be used by regulators as part of the process of establishing a Catastrophe Risk charge. It is felt that the data is needed to avoid double counting of catastrophe losses, both in the current underwriting charge and the additional Catastrophe Risk charge which is under development.
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