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Assumptions for Hypothetical Wind-Up and Solvency Valuations Update – Effective Mar 31, 2020, Applicable to Valuations, Effective Dates Between Mar 31, 2020 and Apr 29, 2020 and Between Apr 30, 2020 and Dec 30, 2020

The Committee on Pension Plan Financial Reporting (PPFRC) conducted its quarterly review of group annuity pricing conditions as at March 31, 2020. It determined that a revision to its previous guidance regarding assumptions for hypothetical wind-up and solvency valuations is appropriate for non-indexed annuities, while no revision to its previous guidance for annuities fully indexed to increases in the Consumer Price Index is appropriate for valuations with effective dates on or after March 31, 2020 (but no later than December 30, 2020).

Additional information is contained in this educational note supplement. For the period March 31, 2020, to April 29, 2020, the guidance contained in this educational note supplement is consistent with the preliminary communication dated April 16, 2020, which was approved by the Actuarial Guidance Council and with the update – preliminary communication dated  April 24, 2020. For the period April 30, 2020, to December 30, 2020, the guidance contained in this educational note supplement is consistent with the preliminary communication dated May 14, 2020, with the exception of the durations.

For any questions, contact Jared Mickall, Chair, PPFRC.

Announcement Number2020-06(07195) June 3, 2020