Key Benefit Concepts (KBC) provides several unique actuarial services including attestation of self-insured health and dental plan financial soundness and/or adequacy of incurred but not reported (IBNR) reserves.
Wisconsin Statute §120.14 state audit guidelines that school district audits should include information concerning the school district’s self-insured health and dental plans. Specifically, a footnote with a date of actuarial certification attesting to the adequacy of the District’s self-insured health and dental plan reserves, rates, and the overall financial soundness of the District’s plan(s). (The self-funded insurance footnote template can be found in Section 4.1 of the 2022 Wisconsin School District Audit Manual). Other states have similar requests.
Per the Office of the Commissioner of Insurance (OCI), beginning for the 2019/20 financial report, a self-insured footnote was to be included in the District’s financial statements which required an actuarial certification attesting to the adequacy of the reserves, rates and financial soundness of the plan. OCI has decided to rescind this actuarial certification requirement beginning with the 2021/22 fiscal year. Therefore, per OCI’s statement, Wisconsin school districts are not required to file the actuarial certification with the 2021/22 financial audit reports. Other states may have different requirements.
However, while this actuarial certification/footnote is not required, it is best practice for self-insured plans to review its adequacy and soundness on a regular basis to ensure the plan is properly structured. Please keep KBC in mind while performing your upcoming year-end audit and do not hesitate to reach out to us if you determine a self-insured health and dental plan attention service is needed.