GH-FV Fall 2020

Yeah, sorry, FE is full eligibility. Once you hit that, your SC is 0.

I don’t know… we’ll have to wait for solutions to really know.

I didn’t know much of anything about market consisten EV vs EV. I just talked about interest rates

Your approach may have been correct for all we know.

Also even if you did overthink it and go off base you definitely got tons of partial credit, if not most/all of it.

The pensions question in July- I thought I did everything wrong based on solution, but I got a much better than median % cause I guess others didn’t even try as much

Also in July, I thought I had THE solution to the EV/AA conversion math question and the graders did not agree whatsoever.

Yeah, i just discussed the rates used and that MC EV allows you to compare better to other companies vs trad EV. I had seen the note card multiple times nad was like “No way MCEV will be on it, I can focus elsewhere” and well ,whoops! haha

Question 7 (the M&A one) was annoying because

  1. i had naively assumed there would only be 6 questions so I hadn’t allocated time properly
    2)naming 12 questions and then tying each one to the case study was very time consuming for only like 4(6?) points.

It really felt like they decided to shoe horn the question in when they realized none of the prior questions related to the case study

This exam was LONG. 7 questions is a lot.

I was fortunate enough to be prepared for the M&A. It hasn’t been tested in a while (if ever) I had a feeling that it would be tested via the case study. So I read that chapter in detail and I asked myself- ok, how does this apply to Royale and Pinewood? So I was able to list a lot of questions/reservations from memory pretty much because I had already gone through this brainstorming step.

I don’t even know how many questions I wrote down and if I tied every single one to case study explicitly. But I know I wrote a ton of questions and I used a lot of case study info. Hopefully they pick the 12 they like best! Hmm not everything was in form of a question. Some were statements.

It was 3 points. There were 2 points earlier for a straightforward M&A list that I partially messed up.

Now I’m actually second guessing the pensions one. If there is no service cost, then you can’t possibly make a mistake on the years to eligibility.

Maybe it would be better to say “assume service cost is a relatively small component of NPPBC”

Is there somewhere on the SOA website / literature that indicates we can explicitly talk about the exam now?

yeah you can generally talk about the exam starting with that evening. Next day for sure. July sitting was a special case cause there was talk about candidates being able to have private proctors at later dates.

But now that it’s at prometric and even the poor souls that couldn’t take an exam on Monday weren’t able to reschedule for a later date I’m pretty confident that FSA exams are only given on exam day. Next day is safe. You can look at the specialty exam discussion. Actuarial Outpost used to have explicit instructions on when it’s safe to talk.

it’s same here actually: SOA Fellowship Exams start today. Because the exams are given by CBT, please do not discuss your exam until 6 AM New York time THE DAY AFTER you take the exam.

sgiordano45, did you know all those regulations they wanted? I don’t even remember how many points it was but there were multiple questions on regulatory filings. I think. They’re blending together for me. And what financial statements are confidential?
(also everyone, but sgiordano45 is the only other participant right now)

And how about the non NPPBC words questions in the pensions question? There are all lists. This question was so many points in total. I had some stuff, not comprehensive. What instructions did you give to help them establish that pension fund they wanted?

Anyone surprised at the volume of new material tested?

There was a question on response to discontinuation of cost sharing reductions, and then critiquing that response.

The plan that wanted to expand to new geographical areas, what advice did they get?

I had not memorized all the NAIC reports. I mentioned Annual/Quarterly + a redact RBC report for non-confidential but all i could remember for confidential was RBC report.

All I remember was a question asking for two ASOPs that have to do with filings. I put ASOP 26 (Small Group Filings) and ASOP 50 (ACA AV/MV)

For the OPEB questions, I word vomited the demographic and economic long term assumptions. I then word vomited the HCCTR (Trend) list as well as the list for Ideal Funding Vehicle. I recommended they use VEBA which most of what they want but I don’t believe VEBA assets are revocable w/o penalty. I could be wrong but on that but it hit most of the ideal candidates.

Yeah, I tried to focus on the new stuff but thought they’d hit Medicaid waivers instead of a full question on the impacts of Medicaid expansions. I had read those lists multiple times but had failed to fully memorize it. I definitely got some points on each but not as much as I would have wanted.

I told the geographic plan to partner/acquire with similar type practices (narrow network HMOs used to global cap) in the target areas. Easiest way to expand and bring something into their system as those systems should integrate into the current processes over trying FFS PPO providers.

Nice!

I didn’t remember any of those reports. All I could come up with are some generalities- blue blanks, they’re pre formatted and consistent, etc. I had nothing for confidential.

I feel ok about the ASOP filing question. I talked about ASOP50 (which conveniently was asked about in a different question AS WELL so later I just copied and pasted the more detailed description) as well as 23 and 41. 23 and 41 almost always apply and I described them both cause I feel that using ASOPs 23 and 41 is a bit of a cop out. I think 41 applies more. So I feel like I did have 2 decent ones.

OPEB- I did not memorize these lists like you did, but I was able to come up with some items. My ideal funding vehicle was weak. I did not remember what VEBA was. I recommended a retirement fund via a cafeteria plan due to the tax concerns. Was that even in this reading? I feel like it’s not an unreasonable response.

Medicaid expansion- same. I wrote something for each section, feeling best about the economic effects. That reading was a little disorganized. Did not memorize any lists from there.

Huh, yeah no medicaid waivers.

I told the plan that wanted to expand to rent a network or to try some risk sharing agreements with the providers. The rent a network maybe is similar to the partnering suggestion. Acquiring is a good suggestion.

Now I remember more GAAP and STAT question(s).

One 3 pointer on specific differences GAAP vs STAT which I was solid on.

Then there were several questions that had format of:
“x” then impact on statutory something, impact on statutory surplus, and possibly something else.

Yeah, GAAP Vs Stat was another memorized list for me. I think I did very well on it.

I was unsure on that treatment in STAT for “Prepaid Expense Asset” and “Claims Overpayment Receivable”. I put the Prepaid Expense as a Contra-Expense instead of an asset (so only impact NI) and the other one as affecting both (Stat Income and Stat Balance Sheet?).

I could be entirely wrong but I did remember reading that for stat, something things are Contra-Expenses or Contra-Liabilities instead of being what they sound like.

Just checked my outline:
Under NAIC SAP, such prepaid expense assets are non-admitted, the argument being that
these assets are not immediately available to pay policyholder obligations.

So my feeling it wasn’t reflected in assets was correct but my explanation likely wasn’t.

b. The NAIC SAP guidance on these asset classes could lead to differences between statutory
and GAAP balance sheets.
i. For example, NAIC SAP requires that if an insurer identifies claim overpayments it
made to a provider, then it should record an asset and non-admit any portion of that
asset that exceeds the insurer’s liability to that provider
So it’s not a contra liability (it is under GAAP apparently) so I missed that one

Prepaid-expense asset is similar to DAC- it’s not admitted in STAT, it has to be recognized immediately. So surplus would be decreased.

Did they ask about impact to stat assets in addition to stat surplus?

Income from ASO fees is the one that’s contra expense for STAT.
Quota reinsurance also is a contra liability for STAT. (GAAP grosses up the Assets)

The claim overpayment thing- It’s one of the things I was supposed to know but I don’t know if I recalled the exact treatment correctly. I wrote it has to be netted out against something else first.

I don’t think prepaid expanse is a contra liability for GAAP either.

Oh wow the claim overpayment is a contra liability for GAAP. Well they didn’t ask about GAAP claim overpayments. (for those that had sufficient correct differences in the GAAP vs STAT free form 3 pointer)

[I had compiled a master list of the most important points of GAAP vs STAT accounting.]

Yeah, I definitely missed a bunch of points on that one. Hopefully whatever I jotted down will get me something there.