BestWeek: Proposal Addressing Short-Term Relief From Redundant Reserves Keeps ''Peace'' in the Family.

OLDWICK, N.J. -- The American Council of Life Insurers' recent proposal to provide short-term relief from redundant reserves for writers of term life and universal life with secondary guarantees is gaining steam.

One life company executive calls it a "reasonable compromise" that would maintain solvency and peace in the industry. The move is part of the effort to change how U.S. life insurers set reserves via a switch to a principles-based system, according to an exclusive story in the Jan. 16 BestWeek.

The ACLI proposal, presented to the National Association of Insurance Commissioners' Life and Health Actuarial Task Force at the NAIC's Winter National Meeting in December, would bridge the gap between Jan. 1, 2007, and the date that principles-based reserves are adopted in all 50 states, said Paul Graham, ACLI's vice president of insurance regulation and chief actuary. The goal for adoption is by the end of 2006.

Bill Koenig, senior vice president and chief actuary at Northwestern Mutual Life Insurance Co., said the company likes that the ACLI proposal offers sufficient reserve relief to companies that write term life and to those that write universal life with secondary guarantees.

Also in the Jan. 16 BestWeek:

--Why many of the heads of major insurance companies don't agree with a proposal to create a government-sponsored national catastrophe program;

--Why Roger Hermann, senior vice president with broker, Aon Natural Resources, thinks mining companies, as a result of recent Sago mine tragedy, will purchase higher liability limits; and

--Why the United Kingdom's national health service is gaining conservative support.

Also featured is Best's Insurance Composite Index, which finished the week of Jan. 12, 2006, at 1,177.49, up 19.17% compared with a year ago. The composite index reflects the performance of 138 insurance stocks. The week's top performers were Universal American Financial Corp.; James River Group Inc.; Gainsco Inc.; SCPIE Holdings; and AmerUs Group.

BestWeek is published by A.M. Best Co. for insurance professionals, including home office executives, agents and brokers.

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A.M. Best Co., established in 1899, is the world's oldest and most authoritative insurance rating and information source. For more information, visit A.M. Best's Web site at www.ambest.com.