Accounting Standard Updates
NAIC’S COVID-19 IMPACT DECISIONS: Update to EXTENSION OF 90-DAY RULE
Article reading time: 1 minute 30 seconds
Hot Take:
JLKR previously provided an update on three Statutory INTs specifically related to the COVID-19 impact on quarterly financial reporting presentation. Those INTs have now been revisited by the Statutory Accounting Principles Working Group (SAPWG) for extension in light of the COVID-19 pandemic progression. JLKR Senior Manager, Ani Zadorian, provides a status update on the August 17, 2020, SAPWG decisions to extend the reporting options on these important interim promulgations.
Full Article
On August 17, 2020, the NAIC Statutory Accounting Principles Working Group (SAPWG) extended the provision of INT 20-02, Extension of the Ninety-Day Rule for the Impact of COVID-19 to be applicable for the September 30, 2020, quarterly financial statements.
The Interpretation allows for a one-time optional extension of the ninety-day rule covering uncollected premiums, bills receivable for premiums, amounts due from agents and policyholders, amounts due from policyholders for high deductible policies, and amounts due from non-governmental uninsured plans to be an admitted asset even if they are 90 days past due. The ruling is for policies in effect and current prior to March 13, 2020, the date the U.S. federal government declared a state of emergency resulting from COVID-19, and policies written or renewed on or after March 13. This ruling does not preclude the existing impairment analysis required within the statements of statutory accounting principles. If impairment is determined, amounts should be written off against the applicable accounts.
The Interpretation will automatically expire on December 30, 2020. However, SAPWG will assess and review circumstances to determine if an extension is required beyond September 30, 2020.
Other Updated Interpretation Related to COVID-19:
You can read more about the other INTs revisited and extended by the SAPWG during their August 17 meeting by clicking below.
