(1) (a) In accordance with 33-2-521(4) , (5) and 33-7-118(2) , MCA, the appointed actuary shall prepare a memorandum to the company describing the analysis done in support of his or her opinion regarding the reserves under an ARM 6.6.6508 opinion. The memorandum shall be made available for examination by the commissioner upon his or her request but shall be returned to the company after such examination and shall not be considered a record of the insurance department or subject to automatic filing with the commissioner.

(b) In preparing the memorandum, the appointed actuary may rely on, and include as a part of his or her own memorandum, memoranda prepared and signed by other actuaries who are qualified within the meaning of ARM 6.6.6505(2) , with respect to the areas covered in such memoranda, and so state in their memoranda.

(c) If the commissioner requests a memorandum and no such memorandum exists or if the commissioner finds that the analysis described in the memorandum fails to meet the standards of the actuarial standards board or the standards and requirements of these rules, the commissioner may designate a qualified actuary to review the opinion and prepare such supporting memorandum as is required for review. The reasonable and necessary expense of the independent review shall be paid by the company but shall be directed and controlled by the commissioner.

(d) The reviewing actuary shall have the same status as an examiner for purposes of obtaining data from the company and the work papers and documentation of the reviewing actuary shall be retained by the commissioner; provided, however, that any information provided by the company to the reviewing actuary and included in the work papers shall be considered as material provided by the company to the commissioner and shall be kept confidential to the same extent as is prescribed by law with respect to other material provided by the company to the commissioner pursuant to the statute governing these rules. The reviewing actuary shall not be an employee of a consulting firm involved with the preparation of any prior memorandum or opinion for the insurer pursuant to these rules for any one of the current year or the preceding 3 years.

(2) When an actuarial opinion under ARM 6.6.6508 is provided, the memorandum shall demonstrate that the analysis has been done in accordance with the standards for asset adequacy referred to in ARM 6.6.6505(4) and any additional standards under these rules. It shall specify:

(a) For reserves:

(i) Product descriptions including market description, underwriting and other aspects of a risk profile and the specific risks the appointed actuary deems significant;

(ii) Source of liability in force;

(iii) Reserve method and basis;

(iv) Investment reserves;

(v) Reinsurance arrangements.

(b) For assets:

(i) Portfolio descriptions, including a risk profile disclosing the quality, distribution and types of assets;

(ii) Investment and disinvestment assumptions;

(iii) Source of asset data;

(iv) Asset valuation bases.

(c) Analysis basis:

(i) Methodology;

(ii) Rationale for inclusion/exclusion of different blocks of business and how pertinent risks were analyzed;

(iii) Rationale for degree of rigor in analyzing different blocks of business;

(iv) Criteria for determining asset adequacy;

(v) Effect of federal income taxes, reinsurance and other relevant factors.

(d) Summary of results.

(e) Conclusion(s) .

(3) The memorandum shall include a statement:

"Actuarial methods, considerations and analyses used in the

preparation of this memorandum conform to the appropriate

standards of practice as promulgated by the actuarial standards board, which standards form the basis for this memorandum."