Solvency Regulation in Canada

A recent feature of the Canadian insurance environment is increasing government reliance on private sector actuarial reporting to assist in the regulation of insurance companies. One new requirement is a report by an Appointed Actuary on the company's expected future financial position. Standards of Practice for the application of Dynamic Solvency Testing (DST} to life insurance companies have already been developed to meet the new requirement. This paper presents some background and an overview of current requirements, the response of the life industry to the changing regulatory climate, and the progress made to date by the property casualty sub-committee in responding to this new challenge.