The Canadian Institute of Actuaries (CIA) initially published an educational note on financial condition testing (FCT) in April 2020. In January 2023, an updated version was published to reflect IFRS 17 concepts and terminology. As of July 2025, additional refinements were made on topics highlighted below.
2025 Updates
Notable updates include:
a) Expanded guidance around the definition and reporting of management actions related to the FCT.
b) Added minor clarifications on the usage of target capital ratios within the FCT process, when these ratios change close to finalization of the FCT.
c) Expanded references and examples in line with CRMCR 2025 Spring Letter (Guidance for the 2025 Reporting of Capital, Financial Condition Testing, and Own Risk and Solvency Assessment for Life and Health, Property and Casualty, and Mortgage Insurers) related to cyber and climate risk.
d) Updated wording to reflect IFRS 17 as being in force and removed implementation impacts on FCT.
e) Wording updates to reflect current guidance from other educational notes.