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Practice Areas

Financial Examination

We conduct risk-focused, combined (financial and market conduct) or targeted financial examinations. Most financial examinations include conducting a risk assessment, assessing the internal control environment (which may also include information technology (IT) controls using the Exhibit C CobiT®-based framework) and performing risk mitigation testing at the examined company. All of our examination work is performed in accordance with standards prescribed by the state's procedures, directives, and orders as well as the NAIC Financial Condition Examiners Handbook.

Our goal is to provide value-added deliverables, including the examination report and supplemental management letter, identifying significant management, strategic, governance, operational and internal control deficiencies and associated recommendations based on the highest levels of risk. As necessary, we will utilize subject matter specialists (e.g., Enterprise Risk Management (ERM), corporate governance, investments/derivatives, actuarial, IT, privacy, reinsurance and taxes). These specialty resources assist considerably with the assessment of prospective risk areas. In addition, our team will pull in specialty resources who are well versed in data analysis (including the use of statistical sampling methods and ACL software), review of claims, and market conduct issues, as appropriate. Where acceptable to a state based on their preferences and directives, we utilize and train our personnel on our proprietary "Best Practices" model and supporting tools/templates to complete the examination efficiently, documenting our work in TeamMate, within the budgeted time and by the completion date assigned.

Our professionals focus on the following goals when conducting an examination:

  • Conduct Exams that identify significant deviations from statutory accounting that impact solvency
  • Identify Deviations from state insurance laws and regulations and relevant NAIC guidance
  • Conduct Risk Assessments and Risk Mitigation Testing, focusing on those areas of highest inherent risk (i.e.,  areas that could impact prospective solvency)
  • Perform Exams according to state guidelines, the NAIC Financial Condition Examiners Handbook, and accreditation standards
  • Report significant management, strategic, governance, operational and internal control deficiencies