"Responses to some of the survey questions were not surprising, but they were disheartening,” said Connie Jasper Woodroof, StoneRiver liaison to the National Association of Insurance Commissioners (NAIC). “In today's business atmosphere, a company needs to stay current on looming regulatory issues so the organization can move ahead with a plan when those regulations go into effect.”
The goal of the second annual survey was to gauge the opinions of insurance industry professionals about regulatory and accounting-related issues.
The survey addressed seven topics: Own Risk and Solvency Assessment (ORSA) requirements, compliance assistance and information resources; plans to manage the potential transition to International Financial Reporting Standards (IFRS); primary information source for IFRS; the ability of accounting software and reporting tools to provide the detail required for ORSA and/or IFRS requirements; plans to use ORSA/IFRS requirement changes project to achieve additional discretionary objectives; and perceptions of the reinsurance model revisions.
Survey results showed that once ORSA requirements are finalized, assuming they applied to a given respondent's company, 44 percent of respondents said they have the in-house expertise and would not use outside consulting services; nearly as many said they would seek external assistance.
Forty-two percent of respondents indicated consultants, including CPAs and actuarial firms, would be the primary information sources for ORSA; almost half (49 percent) would rely on NAIC. The remaining 9 percent would rely on IASA and others.
If International Financial Reporting Standards (IFRS) were to become a requirement, almost 30 percent said they would "learn as we go." And nearly 60 percent doubt the readiness of their current software and tools to handle future requirements, especially the detail required for ORSA and/or IFRS requirements.
The majority of respondents have not yet had the time to analyze the Reinsurance Model Revisions, and 22 percent “expressed apprehension about how well it will work to have regulators determining approved jurisdictions and assigning insurer ratings,” according to the press release.
The survey results are based on 68 responses, representing a mix of property/casualty, life, health, workers' compensation insurance companies, and reinsurance companies.
This story originally appeared at Insurance Networking News.
Chris McMahon is senior editor for Insurance Networking News, a SourceMedia publication.