{"id":59,"date":"2011-09-16T15:48:26","date_gmt":"2011-09-16T19:48:26","guid":{"rendered":"http:\/\/hbwp.fisherstechtank.com\/?page_id=59"},"modified":"2011-09-16T15:48:59","modified_gmt":"2011-09-16T19:48:59","slug":"statement-of-actuarial-opinion-sao","status":"publish","type":"page","link":"http:\/\/hbwp.fisherstechtank.com\/?page_id=59","title":{"rendered":"Statement of Actuarial Opinion (SAO)"},"content":{"rendered":"

Statements of actuarial opinion are being increasingly scrutinized by regulators<\/strong> and auditors<\/strong>. Over the past few years there has been a significant expansion in the scope of information that must be addressed in the SAO. Among the items in the expansion include:<\/p>\n

\u2022 A very strong continuing education requirement <\/strong>\u2013 actuaries that were previously \u201cqualified\u201d to issue an SAO may no longer be qualified if they have not maintained this requirement.
\n\u2022 Comment on \u201cnew or unusual exposures\u201d<\/strong> (e.g. the effect of economic conditions, housing market, swine flu, etc.) \u2013 actuaries must attempt to quantify the effect of these exposures if material.<\/p>\n

\u2022 A paragraph discussing any risks to \u201cmaterial adverse deviation\u201d<\/strong>– the actuary must discuss whether or not the risk exists, the dollar amount that would be considered material, as well as the possible causes of such a deviation.
\n\u2022 A discussion of \u201cunusual\u201d values on IRIS ratios<\/strong> #9, #10, #11 \u2013 these ratios relate to loss reserve development.
\n\u2022 An exhibit that ties the values in the actuarial analysis and opinion to the values contained in the annual statement.
\n\u2022 A discussion of the changes in the actuarial result<\/strong> from the prior year.
\n\u2022 A discussion of the actuary\u2019s range of reasonable estimates <\/strong>the actuary is also required to calculate the difference between the reserve carried by the company and the estimates provided by the actuary.<\/p>\n

Many actuaries providing an SAO do not meet all of these requirements. We always do.<\/p>\n

Our tagline is \u201cComplex Calculations Made Easy to Understand\u201d. We know that it is not enough to provide accurate, sound results. We must also make them understandable. If results are not understandable, business executives will find it difficult to share with other key stakeholders. Our analyses are easy to understand and can be used by clients to directly impact their bottom line. <\/p>\n