Lighthouse Financial Services Company — A rolling assessment of trajectory toward Gate 2 — Development Complete & Filing Readiness, convening 01 April 2027. Maintained by the Chair through Stage 2 and tabled at each monthly program review. Status as at 16 October 2026, 167 days before the gate.
1. What this document is, and is not
The Gate 1 Business Case Package was a decision package tabled at a gate. The Gate Conditions Register tracks five specific, binding obligations. This document is broader and more provisional than either: it reads the full must-meet and should-meet criteria for Gate 2 — fixed at Gate 1 on 11 June 2026 under Governance Model §9 and set out in full at Gate Decision Framework §9 — against the evidence available today, so the Chair and the Board can see where the package is heading before it is built.
It carries no vote and commits the Board to nothing. Its only function is to make a late surprise at Gate 2 less likely.
2. Must-meet criteria — current trajectory
Framework §9 fixes five must-meet items for Gate 2. Any one unmet at the gate removes GO and GO WITH CONDITIONS from the table regardless of the weighted score (Framework §5, rule 1).
1. Contract forms complete and cleared by outside counsel In progress
Status at 16 October 2026: Not yet clear. GLWB rider contract form language has been returned twice by outside counsel over the free-look / death-benefit interaction (I-05); the third redraft is with counsel now. The base contract form is stable. No regulatory objection has been raised — this is a drafting cycle, not a filing risk, but it has run longer than the two cycles the Stage 2 plan assumed.
2. Pricing signed by the Chief Actuary, supported by the GC-03 independent review On track
Status: Tied directly to GC-03 (§5 below), which is on track. Ardmore Actuarial Partners' fieldwork is underway with reporting expected ahead of the 26 February 2027 due date. The Chief Actuary has not signed the current basis and will not until the external opinion is in hand — that sequencing is deliberate, not a delay.
3. Illustration output validated against the filed methodology In progress
Status: The engine configuration for the reduced three-strategy set (D-03, closed under GC-01) is complete. Validation testing against the filed illustration methodology is scheduled across the remainder of Stage 2; the two strategies the incumbent engine could not support (I-02) are out of scope entirely rather than pending, which removes the harder half of this criterion.
4. Hedging readiness plan accepted under GC-05, ISDA milestones dated At risk
Status: Tied directly to GC-05 (§5 below), assessed at risk. The plan itself is drafted; one of the two required derivatives counterparties has not begun ISDA negotiation under DEP-06. This is the single item most likely to determine whether Gate 2 convenes with every must-meet certifiable.
5. All Gate 1 conditions closed, or explicitly re-issued by Board decision with new dates Partially met
Status: Three of five closed (GC-01, GC-02, GC-04). Two open — GC-03 on track, GC-05 at risk. Neither has been re-issued; both still carry their original Gate 1 due dates, both ahead of Gate 2.
3. Should-meet criteria — directional trend
The five should-meet criteria and their weights, fixed at Gate 1, are unchanged from Framework §9. What follows is a directional read against each, not a score.
| Criterion (weight, fixed at Gate 1) | Trajectory at 16 Oct 2026 |
|---|---|
| Filing readiness — completeness of the Compact submission package (25%) | → Steady — on the planned track pending the GLWB form language landing (I-05) |
| Pricing robustness under the external review and current option budget (25%) | → Pending GC-03 — cannot move materially until the external opinion is in hand |
| Platform & illustration build completeness against specification (20%) | ↑ Improving — scope reduction under GC-01 removed the hardest dependency |
| Competitive position of the illustrated product at current rates (20%) | → Steady — illustrated cap 9.25% holds above peer 9.00% and the 8.50% floor fixed at Gate 1 |
| Distribution readiness — channel and appointment pipeline (10%) | ↓ Watch — $17,000,000 of Year 1 premium remains uncommitted after GC-04 closed (I-06, R-07) |
These are directional reads, not scores. The Gate Decision Framework scores should-meet criteria only at a convened gate (§5); assigning numbers here would imply a pre-judgment the Chair is not authorized to make.
4. Gate Conditions carried into Gate 2
Full detail, verification methods and post-closure efficacy findings live in the Gate Conditions Register; this section restates only what bears on Gate 2 readiness.
GC-03 — Independent external actuarial peer review of GLWB pricing On track
Owner S. Ravichandran, due 26 Feb 2027. Ardmore Actuarial Partners engaged, data room populated, fieldwork begins November with reporting margin ahead of the due date. A Gate 2 blocker — the must-meet at §2.2 names it explicitly.
GC-05 — Hedging readiness plan with ISDA execution milestones At risk
Owner M. Delacroix, due 12 Mar 2027. Plan drafted and target operating model agreed; of the two derivatives counterparties required under DEP-06, one is at executed term sheet and the second has not begun negotiation. A should-meet input rather than a named must-meet blocker — which is precisely why the Register flags it now rather than waiting for the due date to arrive with the position unchanged.
5. Risks bearing most heavily on Gate 2
| ID | Risk | Bearing on Gate 2 |
|---|---|---|
| R-05 | Hedging readiness lags launch | Direct driver of the GC-05 at-risk assessment |
| R-06 | Pricing assumptions prove unsupportable under external peer review | The reason GC-03 exists; realized either way at Gate 2 |
| R-01 | IIPRC review extends past the standard clock over the GLWB feature | Bears on must-meet 1 (contract forms) once filed |
| R-08 | Illustration engine cannot produce compliant hypothetical illustrations in the filing window | Bears on must-meet 3; reduced by the GC-01 scope cut |
| R-09 | Statutory reserve and capital treatment heavier than modeled | Would move the should-meet financial return trend without changing GC-03's scope |
6. Budget and schedule position entering the gate
Stage 2 released $11,640,000 at Gate 1. $4,538,000 (39%) is spent to date. Gate contingency reserve stands at $1,892,000 after the two draws recorded in the Program Budget. Gate 2, if it carries GO or GO WITH CONDITIONS, releases $7,450,000 for Stage 3 — Testing & Validation.
Stage 2 runs 15 Jun 2026 to 26 Mar 2027, compressed from its original 46 weeks to 40 after the Gate 1 recycle (Recycle Memorandum §8); the launch date did not move to absorb the loop. 18 of 41 weeks are elapsed at the status date, leaving no material float ahead of the 01 April 2027 convening — a fact that raises the cost of any further slippage on must-meet items 1, 3 or 4 above.
7. What has to be true by 01 April 2027
- GC-03 closes on the evidence standard as issued — a signed external opinion, not one in preparation. This is a named Gate 2 must-meet; it is currently the item on track.
- GC-05 shows both counterparties in active ISDA negotiation, not merely an accepted plan that could be satisfied by paperwork around an unstarted relationship — the same pattern the Register flagged in the GC-04 efficacy finding, and one the Chair does not intend to repeat.
- The GLWB contract form clears outside counsel on or before the current redraft, so the filing-readiness should-meet is not still open on the day of the gate.
- Illustration validation testing is complete against the filed methodology for the three in-scope strategies before the package is assembled, not scheduled to finish alongside it.
8. Update cadence
| When | What happens |
|---|---|
| Monthly program review | This assessment and the Gate Conditions Register are refreshed together against the same evidence |
| On a must-meet or should-meet item changing trajectory | Updated out of cycle and flagged to the sponsor |
| Ten business days before Gate 2 | Final readiness position tabled alongside the gate package itself |
9. Document control
| Version | Date | Change |
|---|---|---|
| 1.0 | 11 Jun 2026 | Assessment opened alongside the Gate Conditions Register at the Gate 1 second convening. |
| 1.1 | 16 Oct 2026 | GC-05 trajectory revised to at risk following the September program review; must-meet and should-meet trajectories refreshed. |
Maintained by C. Tyrrell, NPD Program Manager and Chair of the Gate Review Board. Related: Gate Decision Framework §9 · Gate Conditions Register · Stage-Gate Governance Model · Gate 1 Business Case Package.