Dear Commissioner Caride and Mr. Schrader:
Risk & Regulatory Consulting, LLC (“RRC” or “we”) supports the efforts of the Financial Stability (EX) Task Force and the Liquidity Assessment (EX) Subgroup (“Subgroup”) to provide additional tools to enable an assessment of macroprudential impacts on the broader financial markets of a liquidity stress impacting a number of insurers simultaneously.
In December 2019, RRC sent the Subgroup detailed comments on its December 2019 draft “2019 NAIC Liquidity Stress Test Framework for Life Insurers Meeting the Scope Criteria LST Framework” (“LST Framework”) and is appreciative that the Subgroup took our input into consideration. We have also reviewed the 2020 version draft document, dated as of March 1, 2021, and offer the following comments; these represent our thoughts and observations on the LST Framework that are broader in nature. We welcome the opportunity to provide our views and would be happy to address any questions you may have regarding them.