By now, the U.S. insurance industry’s preparations for the Own Risk and Solvency Assessment (ORSA) are in full swing. The intended implementation date of January 1, 2015, is less than a year away, and many insurers will soon need to finalize their plans for completing an ORSA and filing the associated ORSA Summary Report.
The National Association of Insurance Commissioners (NAIC) has conducted an ORSA Feedback Pilot Project (Pilot Project) in each of the last two years, providing insurers with the opportunity to take a voluntary “dry run” at completing an ORSA Summary Report. At the conclusion of each Pilot Project, summarized results and general feedback comments were made public.
With two Pilot Projects in the books and 2015 just around the corner, it is time to take stock of the ORSA landscape. What has the industry learned about the ORSA to date? Further, what practical steps can insurers take to prepare an ORSA that both satisfies regulators and enhances the company’s market value and solvency position?