Regulatory Solvency and Insurance Consulting
State insurance regulators face several challenges as they strive to achieve fair, adequate and timely regulation. Limited resources often affect the state’s ability to determine compliance, identify violations and ensure solvency.
How we can help
At RSM McGladrey, our Regulatory Insurance Consulting Practice has dedicated resources that specialize in serving state insurance departments. We have more than 70 professionals throughout the U.S. with regulatory experience. Our qualified professionals provide state regulators with a full range of insurance services, including:
Depending on your needs, our professionals provide comprehensive, combined (financial and market conduct) or targeted-scope financial engagements.
Solvency analysis
We approach insolvencies with two groups of trained professionals — our insurance industry group who has worked on large and small insurance company insolvencies, and our forensic and insolvency specialists who specialize in insurance company insolvencies and bankruptcies covered by the Federal Bankuptcy Statutes. Since insolvencies frequently involve insurance companies, non-insurance parent companies and related non-regulated entities, our insurance industry group works with corporate recovery specialists to provide the resources that best fit your needs.
Strategic and financial analysis
The many internal and external forces pressuring insurance companies undoubtedly affect operating and financial strategies — which are important to companies and regulators alike. We have the resources and experience to conduct detailed analyses, providing strategic focus for current and future courses of action throughout all areas of insurance operations.
Our professionals have performed the following services to assist state regulators in guiding the strategic direction of both healthy and distressed insurance companies:
- Mergers and acquisitions (Form A filings)
- Analysis of strategic direction and plans
- Cash flow and liquidity testing
- Analysis of complex securitization transactions
- Derivatives implementation and reporting compliance
- Review and analysis of investment strategies
- Analysis of complex reinsurance and surplus enhancement transactions
- Demutualization and mutual holding company analysis
- Review and analysis of an insurer’s Z-Score
Tax services
Our tax specialists have extensive experience performing statutory accounting practices related to income taxes (SSAP 10 reviews). We also work with insurance departments in preparing tax returns, resolving disputes with the IRS and obtaining refunds from various taxing authorities on a quick and efficient basis. Our tax specialists have developed a methodology whereby refunds from loss or carrybacks are obtained within five business days of filing — often a crucial cash-flow benefit.
Analysis of complex transactions
An area of increasing interest and concern for regulators is in the analysis of insurance companies’ complex transactions. Due to factors like greater volatility in interest rates and credit conditions, increased sophistication of investment instruments, deregulation of the financial markets, regulatory pressures and increased sophistication of analytical techniques, there is a need for experienced individuals to help regulators and insurance companies evaluate strategies and transactions. We have experience in performing and analyzing the following transactions:
- Derivatives
- Securitization
- Reinsurance agreements
- Surplus relief agreements
- Salvage and subrogation recovery analysis
- Investment analyses
- Collateralized mortgage obligations
- REMICS
- Sales with and without recourse
- Use of futures in hedging strategies
Claims review services
Through our operational claims review services, we help identify and propose corrections to problems in claim payment systems. We evaluate the system and the administrator’s performance by assessing the accuracy and efficiency of past claims processing. In addition, we collaborate with health care specialists that have extensive experience working with self-insurance plans, insurance companies, third party administrators and pharmacy benefit managers.
Training
We have developed many regulatory training programs for state insurance departments. These programs can be tailored to meet the educational needs, time constraints, experience level or other requirements as determined by the individual department.
Why RSM McGladrey
Our team of professionals represents a valuable combination of experience, skill sets and credentials, including CFEs/AFEs, CIEs, CPCUs, CLUs, FLMIs, MAAAs, CISAs, Certified Internal Auditors and Certified Fraud Examiners. We have experience in several insurance industries, including life, annuity, accident, health, managed care, disability, property and casualty. We are also involved with several professional organizations, including the National Association of Insurance Commissioners, Insurance Regulatory Examiners Society and Society of Financial Examiners.
