Mid-year 2023 Actuarial Report Prep 

Michelle Bradley, ACAS, MAAA, ARM, CERA, CCIS, Consulting Actuary and Enoch Starnes, ACI, Captive and Complex Risk Consultant

Quarterly or semi-annual actuarial reports can help eliminate year-end surprises and manage overall financial reporting. This may be particularly helpful if your company has had significant changes during the year such as growth, acquisitions, divestitures, changes in third party claims administrators, or shifts in geographic exposures.

Last year, we provided several tips for completing a mid-year analysis, which we have reprised and updated below to address more current concerns. Following this list is advice focused on another emerging issue in the current environment, collateral.

Mid-year actuarial analysis tips:

As you consider a mid-year analysis, review the list of tips below to help ensure this process is smooth and effective.

  • Consider the timing of the mid-year analysis. Reports with data valued in June, July, and August provide results earlier in the year. However, reports completed in September or October may allow for a more credible roll-forward analysis to year-end and give better indications of year-end results.
  • Consider any latent effects of the pandemic on exposures or changes in business.
  • How should the current year be handled if it is not a complete year? Most actuarial reports include a pro-rata portion of the current year through the evaluation date. Therefore, any large claims or significant exposure changes for the current year should be identified and discussed.
  • Are changes to data fields needed? Mid-year is a great time to address any changes to the way data is captured. This process may allow for more detailed claims analysis and can be implemented more efficiently prior to year-end. Examples of potential changes include adding data fields to identify specific injuries, COVID-related claims, or claims being litigated.

There are further suggestions that may be useful in our previous blog on preparing for a year-end actuarial report.

Collateral Issues:

One of the tips in that year-end article highlights collateral considerations. Collateral has been a significant issue for many companies in 2023, and as a result, we are receiving a significantly higher number of collateral consultation inquiries. These normally involve a client believing their carrier is holding or requesting collateral above what they consider to be reasonable. A mid-year actuarial report can help with collateral issues, especially when the carrier collateral evaluation or review also takes place at mid-year. An actuarial report can:

  • include an analysis of the required reserves and loss projection, which can facilitate collateral discussions and comparisons,
  • provide an anticipated payout of liabilities, and
  • estimate roll-forward liabilities to project upcoming collateral positions

Understanding current trends with collateral is important, and SIGMA monitors these trends over time through periodic collateral surveys. The 2023 edition of this survey is currently accepting participants, and we would love your input. Results will be shared with all respondents. You can take the survey by clicking the link below:


Finally, below are several SIGMA resources that can help with collateral issues:

2020 Collateral Survey Results

SIGMA's Collateral Overview Brochure

Collateral Q&A With 1970 Group

If you need more information about any of these topics or help with your mid-year actuarial analysis, please contact us at support@SIGMAactuary.com or schedule a call with one of our consulting actuaries.

© SIGMA Actuarial Consulting Group, Inc.

Leave a Reply

Your email address will not be published. Required fields are marked *


Recent Posts

Navigating Premium Deficiency Reserves
SIGMA is pleased to announce the release of our newest educational resource, the Premium Deficiency Reserve Calculation sample. This resource provides an illustrative example of the calculation of a premium deficiency reserve (PDR). A company must record a PDR when the unearned premium of in-force b...
Read More
A Reflection on Data and Analytics for Captives
In a recent article published by Captive International, Michelle Bradley and Enoch Starnes discuss, “A Reflection on Data and Analytics for Captives". In it, they examine the business world’s reliance on data and analytics as decision-making tools, and how it has undoubtedly increased over the p...
Read More
Adapting Your Captive for a Shifting Risk Landscape
In a recent article published by Captive International, Michelle Bradley and Enoch Starnes discuss, “Adapting Your Captive for a Shifting Risk Landscape". In it, they examine how a company’s risk profile can shift dramatically and without any warning. The impact of a global pandemic, a rising ...
Read More
Navigating Legislative Changes for Healthcare Entities
January is here, and with it comes the need for many companies to complete their annual actuarial report for retained liabilities. If the past several years are any indicator, legislative changes and social inflation could significantly impact the loss reserves and projections prepared in these repo...
Read More

Subscribe to Our Blog

hello world!
Copyright © 2023 – 2024 SIGMA Actuarial Consulting Group, Inc. All Rights Reserved.
chevron-down linkedin facebook pinterest youtube rss twitter instagram facebook-blank rss-blank linkedin-blank pinterest youtube twitter instagram