... At Their 2010 Fall Meeting in Orlando, Florida.
The NAIC today deferred resolution on a proposal of the American Council of Life Insurers affecting Long-Term Commercial Mortgage Loans. The ACLI representatives, who address State Insurance Commissioners by their first names and in turn are addressed by them by their first names, were in favor of the deferral. Their proposal is undergoing "modeling" at this time, although what exactly is "modeling," is unclear at least to the uninitiated like me.
The ACLI's website, www.acli.com, identifies the ACLI in the following terms:
ACLI is a Washington, D.C.-based trade association with more than 300 legal reserve life insurer and fraternal benefit society member companies operating in the United States. ACLI members represent more than 90 percent of the assets and premiums of the life insurance and annuity industry. In addition to life insurance and annuities, ACLI member companies offer pensions, 401(k) and other retirement plans, long-term care and disability income insurance, and reinsurance.
An ACLI Derivatives Risk Management Proposal was handed out to onlookers. It is written for accountants in accountants' jargon. If it was written to obscure whatever it contains, it serves its purpose in that case. However, it is obviously not meant to address nor even acknowledge proposals which have been suggested to abolish Derivatives or to regulate them, particularly Credit Default Swaps or CDS or CDS's, like other forms of Credit Insurance.
The ACLI representative affirmed that the ACLI position on this proposal is that it is an accounting issue, if I heard the gentleman correctly. The NAIC panel considering this proposal had considered it previously, and this time it voted unanimously to "expose it for adoption," joining the original proposal with a New York State-proposed amendment, for 30 days. After that time, the panel will apparently meet via telephone conference call to consider whether Derivatives are useful forms of Risk Mitigation, as proposed and amended.
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