Actuaries’ opinions on the financial health of pension funds and insurance companies should be made available to policyholders and pension participants, the Dutch Actuarial Association has said.
The association is also pleading for a ban on company actuaries certifying their own employers. And finally, Laurens Roodbol, board member of the association, proposes to set up a so-called ‘oversight board’, which is to serve as the profession’s watchdog.
Speaking to Holland’s Financieele Dagblad, Roodbol said the opinions of actuaries should be made public “in the interest of consumers”. The association has laid out its proposals in a letter to Parliament and the Labour Foundation.
A year and a half ago, the Dutch central bank DNB asked the group to come up with a plan dealing with its future role in the post-Enron era.
Roodbol fears actuaries could end up being blamed for future corporate scandals if nothing is done.
“Who is to blame in three years’ time, if it turns out interest rates have stayed structurally low and things have really gone wrong for the pension funds and the insurance companies? Will the actuaries then be told that they have not paid enough attention and have not issued enough advance warnings? I fear the answer to that will be yes. Then everyone will of a sudden realise actuaries serve a great public interest,” Roodbol said.
Roodbol, who is the director of actuarial services at insurance company Delta Lloyd, pointed to the Equitable Life debacle in the UK as a prime example of what can go wrong if actuaries are forced to combine a number of tasks.
“One of the problems to come out of Equitable Life is that British actuaries seemed to be led by their commercial interests, instead of the public interest,” he said. He warned this was also an issue in the Netherlands.
“The crux is that the profession is struggling with the issue of independence.”