NOTICES
INSURANCE DEPARTMENT
General Guidance for Disclosure of Prescribed Differences from NAIC Statutory Accounting Principles; No. 2014-05
[44 Pa.B. 2969]
[Saturday, May 17, 2014]This document supersedes the notice published at 39 Pa.B. 6849 (November 28, 2009) and shall remain in effect until a subsequent notice is published in the Pennsylvania Bulletin.
By Insurance Department Notice Nos. 1998-04 and 2000-02, all types of domestic insurers were advised of the requirement to adhere to the NAIC's codified Accounting Practices and Procedures Manual (Manual) in preparing financial statements to be filed with the Insurance Department (Department). The Manual establishes a comprehensive basis of accounting to be adhered to when not in conflict with the statutes or regulations of an insurer's domiciliary state or when the domiciliary state's statutes and regulations are silent. It does not preempt the legislative or regulatory authority of the states.
The Department has identified the following Pennsylvania laws and regulations relating to statutory financial statement presentation that may require disclosure1 in the notes to financial statements and certified public accountant (CPA) audit reports filed by domestic insurers:
Pennsylvania Laws and Regulations NAIC Statements of Statutory Accounting Principles (SSAP) and Appendices 31 Pa. Code § 161.6
(relating to revocation of
reinsurer qualification or certification)A-785 Credit for Reinsurance (9.e.) Section 1008 of The
Insurance Company Law
of 1921 (40 P. S. § 968),
regarding reserves of
reciprocal and inter-
insurance exchangesSSAP No. 53 Property Casualty Contracts—
Premiums31 Pa. Code Chapter 84a
(relating to minimum
reserve standards for
individual and group
health and accident insurance contracts)SSAP No. 54 Individual and Group Accident and Health Contracts and A-010 Minimum Reserve Standards for Individual and Group Health Insurance Contracts Sections 714—716 of
The Insurance Company
Law of 1921 (40 P. S.
§§ 910-14—910-16),
regarding unearned
premium reserves of title
insurance companiesSSAP No. 57 Title Insurance and A-628 Title Insurance 31 Pa. Code Chapter 116
(relating to discounting of
worker's compensation
loss reserves)SSAP No. 55 Unpaid Claims, Losses and Loss Adjustment Expenses and No. 65 Property and Casualty Contracts Section 661 of The
Insurance Company Law
of 1921 (40 P. S. § 832),
regarding premium
reserves of surety
companiesSSAP No. 53 Property Casualty Contracts—
PremiumsSection 2434(d) of The
Insurance Company Law
(40 P. S. § 991.2434(d)),
regarding payment of
deficiencies for fraternal
benefit societiesSSAP No. 4—Definitions of Assets and Non-admitted Assets This notice provides general guidance to assist in a domestic insurer's review of Pennsylvania laws and regulations to identify required disclosures in financial statements and CPA audit reports. The laws and regulations referenced in this notice are not intended to be an all-inclusive list.
Questions concerning this notice may be directed to Stephen J. Johnson, CPA, Deputy Insurance Commissioner, Insurance Department, Office of Corporate and Financial Regulation, 1345 Strawberry Square, Harrisburg, PA 17120, (717) 783-2142, fax (717) 787-8557, stjohnson@pa.gov.
MICHAEL F. CONSEDINE,
Insurance Commissioner
[Pa.B. Doc. No. 14-1065. Filed for public inspection May 16, 2014, 9:00 a.m.] _______
1 See SSAP No. 1, Disclosure of Accounting Policies, Risks & Uncertainties, and Other Disclosures and A-205, Illustrative Disclosure of Differences Between NAIC Statutory Accounting Practices and Procedures and Accounting Practices Prescribed or Permitted by the State of Domicile.
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