Life, Health and Annuity Reinsurance

Fourth Edition | John E. Tiller, Jr. and Denise Fagerberg Tiller

Life, Health and Annuity Reinsurance, Fourth Edition book cover

About This Edition

This fourth edition of Life, Health and Annuity Reinsurance is now available through ACTEX Learning. This edition had a long gestation period, largely because it features the most revisions since the first edition twenty-five years ago. Several factors contributed to the volume of changes.

The Financial Crisis of 2008 is the most critical factor as it affected the financial services industry in the US and abroad. In the US, Congress enacted the Dodd-Frank Wall Street Reform and Consumer Protection Act which created the Federal Insurance Office to collect and analyze data on the insurance industry and identify risky insurers for Federal Reserve supervision.

The second factor was a long needed decision to expand content relating to Canada. Two new chapters were added: Canadian Regulation of Reinsurance and Canadian Reinsurance Accounting and Tax Considerations. The Reinsurance Treaty chapter was expanded to compare and contrast treaty provisions between Canada and the US.

The third factor was the decision to expand the history sections. In conversations with other actuaries, the authors realized that the backstory surrounding the development of regulation, taxes, and the reinsurance industry itself is worthy of preservation in one text.

It is important to note that, despite the twenty-five years since the first edition, the fundamental principles of life, health, and annuity reinsurance have not changed. Risk transfer is still the cornerstone of a reinsurance transaction. The three basic forms of reinsurance: yearly renewable term, coinsurance, and modified coinsurance are still the building blocks.

Book Contents

The chapters are organized into six parts:

  1. Introduction to Life, Health, and Annuity Reinsurance
  2. Methods and Applications of Reinsurance
  3. Treaties and Risk Considerations
  4. Regulatory, Accounting, and Tax Considerations
  5. Additional Products and Topics
  6. Administration and Management Considerations

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Bibliography

The bibliography has been expanded to reflect contributions from professional organizations, regulatory entities, and academic sources.

Books, Journals, and Reliable Websites

  • Adney, John, JD. "Federal Tax update: Selected Developments & Issues Affecting Life Insurers." Presentation: Society of Actuaries Life and Annuity Symposium, May 6-7, 2012.
  • A. M. Best. Best's Insolvency Study: Property/Casualty Insurance 1969-1990. Oldwick: June 1991.
  • Antes, Richard, Ernst & Young. "Federal Income Taxation of Life Insurance Companies." New York: Bender, 1988.
  • Barth, Michael M, PhD. "Risk Based Solvency Regulation in the U.S." Paper presented at World Bank Contractual Savings Conference, Washington, D.C., November 3-7, 2003.
  • Basel Committee on Banking Supervision. Longevity risk transfer markets: market structure, growth drivers and impediments and potential risk. Bank for International Settlements. Basel: December 2013.
  • Becker, Joanna, FSA, MAAA. "Discussion of Reinsurance Provisions in a Life Reinsurance Agreement." Treaty Committee-Reinsurance Section, Society of Actuaries, August 1, 1994.
  • Bluhm, W.F. Group Insurance, Sixth Edition. Winsted: ACTEX Publications, Inc., 2012.
  • Bluhm, W.F. & Leida, Hans. Individual Health Insurance. Winsted: ACTEX Publications, Inc., 2015.
  • Bormann, Fred F. J., Swales, Jason A., Welch, Jillian M. Canadian Insurance Taxation, Third Edition. Markham, Ontario, Canada: LexisNexis, 2009.
  • Bowers, N.R., et al. Actuarial Mathematics. Schaumburg: Society of Actuaries, 1997.
  • Bruggeman, David. "Life Reinsurance data from the 2013 Munich Re Survey." Reinsurance News, 2014.

United States and Canadian Court Cases

  • Alabama Reassurance Company v. Stucher, Statutory Liquidator of Inter-American Insurance Co., Illinois 1st, 1-98-2508.
  • Ainsworth v. General Reinsurance Corporation. 751 F.2d 962 (8th Cir. 1985).
  • Baer v. Associated Life Insurance Company, 248 California Reporter 1989.
  • Capitol Life Insurance Co. v. The Queen, 84 DTC 6087, [1984] CTC 141 (FCTD), aff'd 86 DTC 6164, [1986] 1 CTC 388 (FCA).
  • Carnation v. Commissioner, 640 F.2d 1010 (9th Cir. 1981).
  • Colonial American Life Insurance Company v. Commissioner of Internal Revenue, 491 U.S.244 (1989).
  • Fidelity & Deposit Company v. Pink, 302 U.S. 224, 82 L.Ed. 213, 58 S. Ct. 162 (1937).
  • First Security Bank Utah v. Commissioner, 405 U.S. 394 (1972).
  • Harper Group v. Commissioner, 979 F.2d 1341 (9th Cir. 1992).
  • Humana, Inc. v. Commissioner, 881 F. 2d 247 (6th Cir. 1989).
  • Koken v. Legion Insurance Company. 831 A.2d 1196 (Pa. Commw. 2003).
  • Paul v. Virginia, 75 U.S. (8 Wall.) 169,169 (1868).
  • Prudential Reinsurance Co. v. Superior Court. 265 California Reporter, 386 (Cal. App. 2 Dist 1989).
  • Sears v. Commissioner 1991, 972 F.2d 858 (7th Cir. 1992).
  • Trans City Life Insurance Company v. Commissioner, 106 T.C.274 (1996).
  • United Parcel Service v. Commissioner. 254 F.3d 1014 (11th Cir. 2001).
  • United States v. South-Eastern Underwriters Association, 51 F. Supp. 712.715 (N.D. Ga. 1943).

United States Government Sources

  • Deficit Reduction Act of 1984, Public Law 98-369 (DEFRA).
  • Dodd-Frank Wall Street Reform and Consumer Protection Act. H.R. 4173. 110th Cong., 2nd sess. January 5, 2010.
  • Employee Retirement Income Security Act of 1974 (ERISA), Pub. L. No. 93-406, 88 Stat. 829.
  • Federal Liability Risk Retention Act of 1986, 15 USC 3901-3906 (1981 as amended 1986).
  • Foreign Account Tax Compliance Act (FATCA), Internal Revenue Code §1471 et seq.
  • Life Insurance Income Tax Act of 1959: Public Law 86-89; June 25, 1959; Sections 801-820 of the Internal Revenue Code.
  • Omnibus Budget Reconciliation Act of 1990, Public Law 99-272 (OBRA 90).
  • Omnibus Budget Reconciliation Act of 1993, Public Law 103-66 (OBRA 93).
  • Patient Protection and Affordable Care Act, 42 U.S.C. § 18001 (2010).
  • Tax Equity and Fiscal Responsibility Act of 1982, Public Law 97-248 (TEFRA).
  • United States General Accounting Office. Insurer Failures: Property/Casualty Insurer Insolvencies State Guaranty Funds. GGD-87-100, July 1987.
  • United States General Accounting Office. Insurer Failures: Life/Health Insolvencies and Limitations of State Guaranty Funds. GAO/GGD-92-44, March 1992.
  • United States General Accounting Office. Insurance Regulation: The NAIC Accreditation Program Can Be Improved. GAO-01-948. August 2001.