On March 17, 2016, the Office of Financial Research, an agency created by the Dodd-Frank Act of 2010 to analyze risk to the financial system, released a brief discussing “recent policy measures” by the NAIC “and the data that insurers began reporting in 2015 about their captive transactions.” The brief analyzes financial data for the year-end 2014, which revealed that U.S. life insurers’ use of captives totaled $213.4 billion in reserve credit. The brief observes that a “little more than a third of the reserve credit backs higher-risk product lines, such as variable annuities and long-term care.” The brief notes that state regulators have begun to revise reporting standards to improve publicly available data to measure the risks from captives and the impact on insurers’ financial condition, but that certain “gaps” in disclosure remain. For example, the brief notes that insurers have disclosed the quality of assets for only 55% of term and universal life captives, measured by reserve credit, largely due to statutory “exemptions.” The brief also cautions that recent NAIC asset quality requirements for new term life and universal life captives can also be bypassed by exemptions — a concern that the OFR believes should be addressed.