From the Leadership Council

By Karen Smith • December 14, 2015 • 0 Comments

The week of Jan. 18, 2016, ACOPA members will have the opportunity to vote to approve the proposed amended Joint Discipline Council Agreement (“JDC Agreement”). You will be receiving (or may have received already) an email with our formal communication of the materials. Voting instructions will be sent in mid-January. For this issue of ACOPA Monthly, I wanted to take a few minutes to provide some additional information in a less formal tone.

In 2011, ACOPA entered into the JDC agreement after years of negotiating with the other five U.S.-based actuarial organizations. The JDC was implemented for several reasons, including reducing cost for both the individual member and the organizations. Prior to the JDC, an individual would potentially go through a separate hearing, discipline process and appeal process in each actuarial organization in which the individual was a member. This could be very time-consuming and expensive. The JDC provided that much of this process would be consolidated at the JDC level, making it more practical and economical for an actuary to mount a defense.

Earlier this year, some of the actuarial organizations thought it would be appropriate to amend the JDC. These changes were not initiated by ACOPA, and to be honest, ACOPA would probably have been preferred to devote our limited resources to other projects rather than negotiating changes to the JDC. However, ACOPA is only one of five parties to the agreement, so when negotiations began it was important that we participated. The negotiations spanned a period of several months, and the tone of the negotiations was productive. While the other parties did not always agree with ACOPA, they respectfully considered our point of view. From a procedural standpoint, I am recommending a vote for the amended JDC because the negotiation process was thoughtful and ACOPA’s concerns were heard and often explicitly addressed. It was a good process.

After a period of negotiations, the sole question that went back to each organization was to approve the amended JDC agreement or not. When negotiating an agreement with five parties, at some point the negotiations must end and each party has to decide whether they are in or are they are out. From a substantive standpoint, I am recommending that ACOPA be “in” and a vote for the amended JDC agreement. 

First, the changes to the agreement are reasonable. The amended agreement provides a reasonable framework to resolve discipline issues. Some members may appreciate the additional choice they are provided under the amended JDC agreement. 

Second, ACOPA members are extremely disadvantaged if the other organizations adopt the amended JDC agreement and ACOPA does not. If that were to happen, ACOPA members would go through the ARA process and then follow the amended JDC process for any other organizations for which they are members. Should the actuary choose a JDC hearing for the other organizations, they would have no guarantee of ACOPA representation on the JDC panel, let alone an ACOPA majority as provided under the current, and amended agreements. Thus, it is important that we remain a party to the amended JDC agreement. 

If membership approves the amended JDC agreement, we will execute the amended JDC agreement and then we will work with ARA to amend the ARA disciplinary process to reflect the amended JDC agreement. We will keep you posted as that process moves forward.

ACOPA was only one of two actuarial organizations that were required to put this issue to a membership vote. Transparency and membership engagement are at the core of ACOPA. Please take a few moments to review the materials and vote.