The current and future economic environment is the single largest concern of life insurance companies. This session will consider the possible paths of future interest rates and examine the implications of current low interest rates on the life insurance industry. At the conclusion of the session, attendees will be able to describe the potential impacts of low interest rates on the life insurance industry.

The Investment Section is hosting a member’s only contest on asset allocation. The results will be reported each week.

Research projects in pension - Pension Risk Management: Derivatives, Fiduciary Duty and Process by Susan Mangiero

This paper provides a summary of the report, Back Testing of Investment Performance by Asset Class.

This research report, part of the Society of Actuaries [SOA} ‘Research Projects – Finance/Investment,’ is sponsored by the Casualty Actuarial Society [CAS], Canadian Institute of Actuaries [CIA], and the Society of Actuaries [SOA] Joint Risk Management Section Research Team and the SOA's Committee on Finance Research. This paper examines the subprime mortgage crises and related financial consequences from the perspective of the insurance industry.

Presentation at SOA Annual Meeting October 2009. More than $10 trillion in home mortgage debt, $62 trillion in default swaps, financial weapons of mass destruction all over the globe – how could all of this have happened? Discussion of how we got into this crisis and how we can avoid repeating this mistake in the future: regulatory developments, mortgage insurance, FHA underwriting standards, loan guarantee programs, adjustable rate mortgages, mortgage backed securities.

Presentation at SOA Annual Meeting October 2009. More than $10 trillion in home mortgage debt, $62 trillion in default swaps, financial weapons of mass destruction all over the globe – how could all of this have happened? Discussion of how we got into this crisis and how we can avoid repeating this mistake in the future: regulatory developments, mortgage insurance, FHA underwriting standards, loan guarantee programs, adjustable rate mortgages, mortgage backed securities.

The prices of many insurance products fail to reflect premiums for the inherent uncertainty they create since there are no hedging assets available in the market. Dr. Robert Merton and Jeremy Gold will lead a panel discussion about how these issues could / should be addressed.

With rates near record low levels and no immediate end in sight, how should insurance companies think about risk management? Whether you are designing or managing a block of variable or equity indexed products, the low rate environment presents additional risks which need to be managed. This session will focus specifically on risks in a low rate environment and consider the role of hedging and product design in managing those risks in variable and equity indexed annuities. At the conclusion of the session, you’ll be able to identify potential sources of risk in their product portfolio due to low interest rates, determine possible risk mitigation strategies to take and evaluate their long term feasibility.