1. Canadian Institute of Actuaries L’Institut canadien des actuaires
2006 Seminar for the Appointed Actuary
Colloque pour l’actuaire désigné 2006

2. PS-8 Allan Brender Capital requirements
Changes for 2006
Changes for 2007
Introduction of advanced approaches
Practice certificates and the role of the Appointed Actuary

3. Changes for 2006 MCCSR MCT No changes to requirements
AA’s opinion and report now required by CIA
MCT
No changes

4. Changes for 2007
MCCSR
Adjustment for move to asset fair values
Change w.r.t. FX for branches (TAAM)
MCT
Beginning in 2007, all capital changes will be effective as of January 1

5. Introduction of Advanced Approaches
Initially, a project for MCCSR
P&C industry is expressing interest w.r.t. MCT
Applies to larger and more technically sophisticated companies

6. Introduction of Advanced Approaches
Advanced approaches involve the use of company-specific risk measurements
Make greater use of company data and perhaps internal models
Also considering two fundamental changes
Move to total balance sheet approach
Consider diversification effects

7. Introduction of Advanced Approaches
Also have to modify MCCSR and MCT for expected accounting changes emerging from the introduction of IFRS4
Therefore, the project will also involve changes to the current standard approaches

8. Introduction of Advanced Approaches
Have formed the MCCSR Advisory Committee (MAC) to guide the process
Includes representation from
OSFI and AMF
CIA
CLHIA
Assuris (formerly CompCorp)

9. Practice Certificates and the AA
Likely that practice certificates will not be required by the CIA in 2006
OSFI will state in its memorandum that it expects AAs to satisfy all proposed requirements for the certificates

10. Practice Certificates and the AA
Concern, based on the tone of comments on the general list, that there is misunderstanding about the history and evolution of the role of the AA, OSFI’s responsibilities and its relationship to the CIA

11. Practice Certificates and the AA
Introduction of the AA is a devolution of authority from the regulator to the profession
The regulator retains ultimate responsibility
The regulator relies on the AA

12. Practice Certificates and the AA
The framework includes delegation of policing to the CIA
CIA has generally been pleased to accept this role
Difficult to imagine why a profession would not want the ability to police itself rather than having others do it

13. Canadian Institute of Actuaries L’Institut canadien des actuaires
2006 Seminar for the Appointed Actuary
Colloque pour l’actuaire désigné 2006