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Urge North Carolina Beach Plan Board to Resolve Surplus Accounting Issue

Despite positive response from the Beach Plan’s accountant, the North Carolina Beach Plan staff decided earlier this week to take “no action” regarding an industry proposal that would resolve the surplus accounting issue, thus punting the issue back to the Beach Plan board. This decision means that for the third quarter individual companies and their accountants will have to decide how to deal with this issue.

Local intelligence suggests that Insurance Commissioner Wayne Goodwin is sympathetic to industry concerns; however, as of this writing, Commissioner Goodwin has not asked the Beach Plan board to act on the industry’s proposed solution.

The Beach Plan board is scheduled to meet on Nov. 9. If your company is concerned about the surplus accounting issue, NAMIC urges you to write board members to ask them to resolve this issue. Letters should be submitted to:

Tom Falkenbach, Chairman
North Carolina Insurance Underwriting Association
3100 Interstate North Circle, Suite 500
Atlanta, GA 30339

Letters should include the following points:

  • Request that the NCIUA board of directors take formal action at its November meeting to amend NCIUA’s Sept. 14, 2009, guidance to members titled Accounting Treatment for Accumulated Surplus.
  • Recommend that the board amend its guidance by adopting the interpretation recently submitted by the Property Casualty Insurance Association of America.
  • Alternatively, if Commissioner Goodwin is willing to provide definitive guidance on this important issue, recommend that the NCIUA board of directors formally recommend to the commissioner that the interpretation provided by PCI is appropriate and should be adopted as the official guidance to member companies.

Liz Reynolds, NAMIC’s state affairs manager for North Carolina, is out of the office until Monday. Should you have questions between now and then, please contact Joe Thesing, NAMIC’s assistant vice president of state affairs, at jthesing@namic.org.

Thank you for your assistance with this important issue.

Posted: Friday, October 16, 2009 12:00:00 AM. Modified: Monday, October 19, 2009 8:36:30 AM.

317.875.5250 - Indianapolis  |  202.628.1558 - Washington, D.C.

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