Actuarial Services for the Stanley G. Tate Florida Prepaid College Program

The Prepaid Plan requires independent actuarial analysis supporting the Board’s statutory duty to evaluate the actuarial soundness of the prepaid fund and to establish plan prices (See Appendix D for an overall description of the program). The services below are minimum requirements; the selected Respondent will perform them using data and assumptions supplied or approved by the Board and in accordance with applicable actuarial standards. 3.01(1) Transition Plan Submit and maintain an orderly transition plan, if applicable. The transition plan should describe the process, details, and schedule for providing an orderly transition from the current provider. The objectives of the transition plan should be to minimize the impacts on continuity of operations, maintain communication with staff, identify key issues, and overcome barriers to transition. 3.01(2) Annual Planning Meet in person with Board staff at least annually to plan the next 12 months of deliverables. As part of annual planning, review material Program experience, assumptions that may warrant further review, emerging actuarial issues, and potential analytical needs that may support significant Board policy, financial, or Program decisions. Provide a detailed annual work plan identifying Board data needs, delivery dates, review points, meetings, draft and final deliverables, and dependencies necessary to meet the Board’s schedule. 3.01(3) Data Review The Board will provide all data necessary to perform the specified contract services. Quarterly, the Actuary shall review, load, reconcile, and evaluate Board-provided data; investigate anomalies; determine whether information is complete and adequate; and recommend data improvements needed for valuations, pricing, and experience studies. (See Appendix I for an example data file). The selected Respondent shall protect Board data and use appropriate actuarial and statistical systems to perform and document all analyses. 3.01(4) Quarterly Actuarial Valuations and Cash Flows Prepare four quarterly actuarial valuation letters each year, as of June 30, September 30, December 31, and March 31, using the latest experience data, Board-approved assumptions, and anticipated future years of sales (as directed by the Board). Reports should include information, charts, breakdowns, and explanations in sufficient detail for the Board to understand the actuarial position of the Prepaid Plan. In addition, monthly undiscounted and discounted cash flows shall be provided to support the appropriate values in the report. See Appendix F for an example of a quarterly valuation report. 3.01(5) Annual Actuarial Valuation and Cash Flows Prepare one annual actuarial valuation report as of June 30. The report will update actuarial projections, include requested sensitivity analyses, reconcile surplus, review experience, recommend assumption changes when 4 appropriate, provide the program termination liability as provided for in Section 1009.98(8) Florida Statutes and with Board guidance, and provide projected undiscounted and discounted monthly cash flows. The Respondent shall review and analyze at least one major actuarial valuation assumption each year. See Appendix G for an example of an Annual Actuarial Adequacy Report NOTE: The annual actuarial adequacy review treats the Program as closed for valuation purposes, evaluating existing contracts without assuming any future sales. This approach does not mean the Program is closed to new purchases. Because the Program continues to sell plans each year, the quarterly actuarial reviews include estimated additional years of sales, as directed by the Board, and the associated future receipts and obligations. The resulting quarterly cash flow projections are used to construct the liability-driven investment (LDI) benchmark, aligning the investment strategy with projected net cash flows from both existing contracts and anticipated future sales. 3.01(6) Sensitivities Develop with the Board and periodically update a sensitivity matrix for material actuarial drivers. Where reasonably practicable, present the results in a form that helps staff understand the directional and approximate effect of defined changes on actuarial adequacy, projected cash flows, and plan pricing, together with appropriate limitations. 3.01(7) Annual Plan Pricing Prepare one annual Prepaid Plan pricing report each year for the designated enrollment period (currently July 1 through June 30), including plan prices by payment option and beneficiary age for each offered product. Test price adequacy, determine and disclose break-even rates of return, and provide illustrative prices at alternative inflation assumptions upon request. The Respondent shall review and analyze at least one major pricing assumption each year. See Appendix H for an example of the Annual Plan Pricing. 3.01(8) Supporting Files Provide electronic actuarial and pricing reports and usable supporting files, including payoff factors and projected cash flows, sufficient for Program operations, benchmark development, review of Board inputs and assumptions, and understanding of results. 3.01(9) Board Presentations and Consultation Appear before the Board annually, to explain and substantiate the annual actuarial adequacy and pricing reports. Consult with Board staff by letter, telephone, electronic communication, or in person upon request. 3.01(10) Professional Standards and Quality Control Perform all services in accordance with applicable qualification standards, Actuarial Standards of Practice, and the Actuarial Code of Professional Conduct. Maintain documented review and quality-control procedures for all deliverables. 3.01(11) Continuity Maintain a continuity plan, update it, and provide it to the Board annually, and cross-train personnel to preserve knowledge of the Prepaid Program. 5 3.01(12) Data Security and Confidentiality Maintain appropriate controls for confidential Board data, limit access to authorized personnel, use secure transmission and storage methods, and promptly report any incident affecting Board information. 3.01(13) Records, Documentation, and Audit Support Maintain work papers, models, assumptions, data reconciliations, and supporting documentation sufficient to reproduce and explain conclusions and to support Board oversight, audit, and transition to a successor provider. 3.01(14) Coordination and Responsiveness Coordinate with Board staff and other Board service providers, respond promptly to questions, identify emerging issues, and communicate any matter that may affect the accuracy, quality, or timeliness of deliverables. 3.01(15) Additional Actuarial Reports, Letters, or Assumption Studies At the Board’s request, conduct additional actuarial adequacy reports or letters, pricing reports or letters, or assumption studies. 3.01(16) Additional Actuarial Advisor Studies and Services At the Board’s request, and subject to advance written scope and fee approval, conduct additional sensitivity analyses, single-plan pricing analyses, or other special actuarial projects not identified above. 3.01(17) Workshops At the Board’s request, prepare and present an in-person workshop on calculations, data, assumptions, legislative changes, reporting, or improvements to models and methods. 3.01(18) Representation At the Board’s request, represent the Board before governing authorities on actuarial matters. 3.01(19) Legislation At the Board’s request, assist with preparation or review of legislation, fiscal notes, and bill analyses. 3.01(20) Other Value-Added Services Respondents may propose actuarial tools, dashboards, modeling enhancements, training, benchmarking, process improvements, or other services that provide additional value, efficiency, transparency, or risk reduction to the Board. Note: Illustrative annual adequacy, quarterly valuation, and pricing reports are informational and do not limit the Board’s ability to modify requirements during negotiations.