On July 24, the ACC responded to the National Association of Insurance Commissioners (NAIC) six proposed principles that will guide their risk-based capital (RBC) review. These RBC changes may negatively impact insurers' investments in private credit and structured securities generally, so our letter focused on ensuring risk-sensitive and internationally competitive RBC standards. Our key recommendations included: assessing RBC adequacy in the context of total available capital; avoiding duplicative capital charges by recognizing the prudence already embedded in statutory reserves; phasing in emerging risks gradually with data-driven oversight; incorporating global investment expertise to align RBC charges with actual economic risk; and promoting consistency through impact analyses.

For further information please contact Joe Engelhard ([email protected])