Automated financial analysis solvency tools
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Automated Financial Analysis Solvency Tools. David A. Vacca, CPA Assistant Director Insurance Analysis & Information Services Department For Regulators Only. Presentation Overview. Overview of Financial Analysis Solvency Tools Databases Serving Other Purposes. NAIC Databases.

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Automated Financial Analysis Solvency Tools

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Automated Financial Analysis Solvency Tools

David A. Vacca, CPA

Assistant Director

Insurance Analysis & Information Services Department

For Regulators Only

Presentation Overview

  • Overview of Financial Analysis Solvency Tools

  • Databases Serving Other Purposes

For Regulators Only

NAIC Databases

  • Financial Data Repository (FDR)

  • Exam Tracking System (Financial and Market)

  • Complaints

  • Special Activities

  • Producer database

  • Change of Control (Form A)

  • Regulator Actions

  • Valuation of Securities

Confidential - Regulator Only

Financial Analysis Solvency Tools

  • Collection of automated solvency tools designed to provide an integrated approach to screening and analyzing the financial condition of insurers

  • Financial Analysis Solvency Tools (FAST)

    • Navigation Tools

    • Notification Tools

    • Analytical Tools

    • Prioritization Tools

    • Adhoc Reporting

For Regulators Only

Tools and Resources

NAIC I-SITE & StateNet








Navigation Tools

For Regulators Only

Number of Insurers Filing to the NAIC

For Regulators Only

Electronic Filing - PDFs

Confidential - Regulator Only

Confidential - Regulator Only


  • Selection and print capabilities of any financial or demographic information that comes from the annual/quarterly statements filed by insurance companies with the NAIC

Confidential - Regulator Only


Confidential - Regulator Only

Confidential - Regulator Only

Line Reports

  • Allow users to compare one line from the annual statement with a group of companies matching the selected criteria (w/ statement type)

Confidential - Regulator Only

Line Report Example

Line Report Example

Company Demographics

Confidential - Regulator Only

Confidential - Regulator Only


Validation Exceptions

Confidential - Regulator Only

Confidential - Regulator Only

MyNAIC Portal

Notification Tools

Confidential - Regulator Only

Personalized Information Capture System (PICS)

  • Push technology

  • Create profile

  • Specify criteria

  • E-mails generated when data changes for companies/individuals that fit into the criteria specified

Confidential - Regulator Only

Email Notification Tools

Confidential - Regulator Only

PICS notifications go directly to your mail inbox

Confidential - Regulator Only

Confidential - Regulator Only

Analytical Tools

For Regulators Only

NAIC Financial Analysis Handbook

  • Provides a uniform means for insurance departments to more diligently identify companies experiencing financial problems or that pose the greatest potential for developing financial problems

  • Provides guidance for the insurance departments to define and evaluate particular areas of concern in troubled companies

  • Updated annually

Confidential – Regulator Only



Financial Analysis Handbook Summary Report

For Regulators Only

Financial Profile Reports

  • The Financial Profile Report is a summary of key financial information for a company over the last five years

  • Includes a Financial Summary page

  • There are also detailed sections for: Assets, Liabilities, Capital & Surplus, Loss & LAE Reserve Analysis, Income Statement, Cash Flow and Exhibit of Business and Profitability

Trend and Ratio Analysis by Insurer

For Regulators Only

Automated Graphs by Insurer

For Regulators Only

Profile: Peer Analysis Report

  • Release for Annual 2007 – Life/Health

  • Released for Annual 2009 – Property/Casualty

  • Profile defines 10 peer companies based on:

    • Line of Business

    • Number of States Writing Business

    • Geographic considerations

    • Closest Asset or Premium Size

  • Profile provides financial data and ratio analysis for 10 peer companies

P&C Peer Analysis Profile

For Regulators Only

Loss Reserve Projection

For Regulators Only

Exam Jumpstart

  • Analyzes the investment schedules data as compared to SVO VOS database or NRSRO feeds and provides summary of potential errors

    • CUSIPs

    • Rates

    • Designations / market value

    • Assumed and Ceded Reinsurance

Percentage of Valuation Discrepancies Analysis

Prioritization Tools

For Regulators Only

IRIS Ratio

  • 13 ratios for Property/Casualty

    • Overall

    • Profitability

    • Liquidity

    • Reserve

  • 12 ratios for Life and Health

  • 11 ratios for Fraternal

  • Asterisks highlight ratios outside usual range

IRIS Ratios

Ratio Analysis

  • Evaluate the ratio results by analyzing each component of the calculation

  • Understand the industry average in relation to the company’s result

  • Understand the company’s historical results and put them in context

Gross Prem. Written/Surplus

Net Prem. Written/Surplus

Chg. in Net Writings

Surplus Aid/Surplus

Two-Year Overall Operating Ratio

Investment Yield

Gross Chg. in Surplus

Net Chg. in Surplus

Liabilities to Liquid Assets

Gross Agents’ Balances/Surplus

One-Year Reserve Development/Surplus

Two-Year Reserve Development/Surplus

Estimated Current Reserve Deficiency/Surplus

IRIS Ratios (P&C)

Net Change in C&S

Gross Change in C&S

Net Income to Total Income

Adequacy of Investment Income

Non-Admitted to Admitted Assets

Total Real Estate & Mortgages to Cash & Invested Assets

Total Affiliated Investments to C&S

Surplus Relief

Change in Premiums

Change in Product Mix

Change in Asset Risk

Change in Reserving Ratio

IRIS Ratios (L&H)

IRIS Ratios

For Regulators Only

Prioritizations Tools- IRIS (Only public tool)

Confidential – Regulator Only

Analyst Team System (ATS)

  • Available for P&C, Life, Health and Fraternal

  • Automated review system that uses statistical analysis, FAST Scores, RBC to assign review levels

    • Level A – High level of concern

    • Level B – Requires attention

    • No level required

  • Confirmed by team of State financial analysts and examiners

  • ATS Reports

    • Analyst Team Comments and Summary of Criteria

Adhoc Summary Tools

For Regulators Only

Timely Industry Data

Market Share Data

Example of Lead State Report

Summary Reports Aggregate Line of Business by State

For Regulators Only

2010 Foreign Exposures

Exposure to Portugal, Italy, Ireland, Greece and Spain

Databases Serving Other Purposes

For Regulators Only

Consumer Information Source - CIS

Consumer Information Source (CIS) provides information about insurance companies to the general public.

Anyone can access key information about insurance companies, by entering the company name and state.

Information provided:

  • Closed insurance complaints

  • Licensing information

  • Key financial data

    Available via a link from the NAIC home page!

For Regulators Only

CIS – Financial Profile

Financial Profile:

  • Company Demographic Information

  • Direct Premium Written By Line of Business

  • Invested Asset Mix

  • Three-Year Net Premiums Written

  • Three-Year Policyholders’ Surplus Trend

  • Three-Year Income/Loss Trend

For Regulators Only


  • Please contact David Vacca at or 816-783-8134 for questions

For Regulators Only

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