Institute and Faculty of Actuaries
Public Affairs Brief
31 July 2017
Marjorie Ngwenya
 
Welcome from new President Marjorie Ngwenya

As the new President of the IFoA I could not have picked a more turbulent time to assume the role – Brexit, a minority government, President Trump, technological leaps forward and the shifting tides of global politics make this an interesting period for actuaries everywhere.

 

Thus the theme I have chosen for my Presidential year is ‘Advancing the Profession’. The work of the IFoA’s Policy and Public Affairs team fits directly into this. For example, the opportunities for the profession posed by advances in data science are being explored in a number of ways, through policy papers, and the forthcoming Data Summit and Autumn Lecture (see more below).

 

In these uncertain times, the way that the profession rises to new challenges will define it, and secure its future. What we do to ensure that we remain relevant and make our voice heard, is the primary focus of the Policy and Public Affairs team. The IFoA will continue to promote actuarial science in the public interest when taking our message to policymakers and beyond.

 

If you have questions about any of the items in this newsletter, ideas for future policy work, or suggestions for how we could improve, please do get in touch: policy@actuaries.org.uk.

 
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Post- Election Update

As we catch our breath after a very busy few months, it is time to take stock of the election result and what this means for actuaries and the IFoA.

 

In the run up to the election the Public Affairs and Policy team produced an analysis of the main parties’ manifestos, and monitored the promises and policies closely to understand how the actuarial profession might be affected by various results.

 

Theresa May’s reduced majority has necessitated a ‘Confidence and Supply' (and Brexit!) agreement with the Democratic Unionist Party. The arrangement has had a number of knock-on effects directly impacting the IFoA’s policy work. For example, the Conservative manifesto contained a promise to move from the triple-lock on State Pension increases, to a double lock. This was at odds with the DUP, and so has been officially dropped.

 

There are also ongoing unanswered questions around the personal injury discount rate and the future of DB and Solvency II. The Public Affairs team and IFoA volunteers will be focusing on the upcoming White Paper on the future of defined benefit pensions and the Green Paper on social care reform. Look out for our fresh analysis on the huge question of social care funding over the coming months.

 
Visit our election page >
 
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Cycle of Risk Principles Steps
Actuarial Risk Principles

The Risk Principles document is a high level guide to risk management designed to help reduce losses, control uncertainty, and optimise decision-making. Some of these principles include taking into account the impact of stakeholder perspectives and system characteristics.  On 21 June, we launched the Risk Principles document with topic specialists discussing how these principles can be applied to three prominent issues with an international remit: climate change, cyber risk, and automated vehicles. If you would like more information or to watch the recording of the event, please check out our Risk Principles webpage.

 
Visit Risk Principles page >
Cityscape
IFRS 17 Event

To help IFoA members understand the International Accounting Standards Board’s long awaited insurance contracts standard IFRS 17, the IFoA’s Financial Reporting Group (FRG) hosted  a panel event in Staple Inn on 10 July.  This addressed questions such as ‘What does IFRS 17 mean for the insurance industry?’ and ‘What do we need to do to prepare for IFRS 17 implementation?’. Expert speakers, including Darrel Scott, an IASB Board member, discussed the new standard that is set to fundamentally change insurers’ profit reporting. To access the presentation, visit our IFRS 17 event page.

 
Visit the event page >
 
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Investing for Sustainable Growth KPP
 
KPP in Focus - Investing for Sustainable Growth

Why?

Our policy work under the Key Policy Priority (KPP) ‘Investing for Sustainable Growth’ focuses on investment that:

  • is long term in nature
  • achieves healthy returns for investors
  • promotes long term economic growth
  • supports financial system stability
  • recognises the environmental and social context for investment activities

How?

The Policy team works closely with members to develop the IFoA’s policy positions on sustainable investment. In particular, we liaise with a number of working parties who are developing thinking on investment issues with public policy implications.  These include working parties looking at infrastructure investment, retail investment communication, and Environmental, Social and Governance (ESG) investment.

 

What?

Policy issues we are working on include:

  • Long term investing – Procyclicality: long term investment mandates
  • Sustainability – ESG, climate-related financial disclosures
  • Growth – Infrastructure investment, low interest rate environment

Other challenges in this area include communicating complex investment information to consumers, measuring non-financial investment risks and returns, and stewardship and fiduciary issues.

 
Visit this KPP page >
 
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Intergenerational Fairness bulletins
 
Intergenerational fairness update

In May, we launched the second of our bulletins on intergenerational fairness, which featured contributions from Sir Steve Webb, Frank Field and Lord David Willets, along with a star line-up of other contributors.

 

Our next bulletin will be launched in September and will focus on Health and Care. The bulletin will cover a range of topics including the potential new means-testing thresholds and ‘care cap’ for social care, the effect of demographic trends on the NHS, income protection insurance, antimicrobial resistance, and other public health issues. Confirmed contributors include the Intergenerational Foundation, Centre for Ageing Better, Aubrey De Grey from SENS research, ABI, and Reform. Keep an eye on our events page for details of the launch event.

 
Explore the series >
 
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Michael Sanders, Autumn Lecture Speaker
 
Save the Date - Autumn Lecture 2017

The IFoA’s biannual Thought Leadership Lecture is to be delivered by Michael Sanders, Chief Scientist and Head of Research and Evaluation at the Behavioural Insights Team, formerly part of the Cabinet Office, on the subject of ‘Data Science and its Potential for Actuaries and Policy Making’.


The lecture will take place on Thursday 13 September in Edinburgh. It will also be live streamed online. You can find out more information by clicking on the Autumn Lecture Event Page.

 
Register here >
 
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QAS logo
 
Quality Assurance Scheme in Asia

The pilot for the IFoA’s prestigious Quality Assurance Scheme (QAS) is well underway in Singapore, Malaysia and Hong Kong. The scheme was first launched in the UK in September 2015 with the aim of recognising professional excellence amongst employers of actuaries. Some 25% of UK actuaries, including 85% of UK statutory pension scheme actuaries, now work for a (QAS) accredited organisation.

 

The Public Affairs team provided support for the launch and secured coverage in the leading regional trade publication, Asia Insurance Review. The pilot ends in December and we plan to launch the scheme across Asia and open applications in Q2 2018.

 
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Word on the Street

The IFoA's Public Affairs team keeps its ear to the ground, constantly scanning the external environment for governmental, parliamentary, regulatory and industry developments that could affect or interest actuaries and the IFoA. Some highlights from this month include:

 

UK motor premiums soar at highest ever levels following Ogden rate change


Proposed new timetable for State Pension age increases


FCA publishes the interim findings of its Retirement Outcomes Review


Nicky Morgan to lead Treasury committee


Department for Work and Pensions intends to publish a White Paper later this year on the future of defined benefit pension schemes

Consultations


The IFoA regularly engages with government, regulators and parliamentary committees by responding to consultations on relevant topics where actuarial analysis can have a valuable input to the public debate.

 

Some highlights from the IFoA's  recent submissions include:

 

Pensions Protection Fund PPF consults on levy rules for next three years from 2018

 

European Supervisory Authority Public consultation on the operations of the European Supervisory Authorities

 

Department for Work and Pensions The draft Occupational Pension Schemes (Employer Debt) (Amendment) Regulations 2017

 

HMT Transposition of the Insurance Distribution Directive

 

IAIS Revised Insurance Core Principles (ICPs) and ComFrame material integrated with ICPs

 

FCA CP17/7: Insurance Distribution Directive implementation – consultation paper I

 

FCA GC17/1: Changes to the way firms calculate redress for unsuitable defined benefit pension transfers

 
More Consultation responses >
Press Release Quotations
 
The latest news from Policy and Public Affairs

Intergenerational fairness considered as state pension age rise is brought forward

 

IFoA seeks clarity on pensions triple lock

 

Marjorie Ngwenya becomes IFoA President

 
Visit our media centre >
Ageing Population
Evolving Rissks and the Future of Insurance
Resource and Environment
Investing for Sustainable Growth
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