Description: This article examines whether catastrophe models be used to predict actual catastrophe experience over a brief period of time.

Description: The crisis has spread due to a systematic failure of the regulatory system. Over the last 20 years, regulations that fostered market stability were eliminated and new financial instruments were allowed to propagate without any real oversight. Instead of bailing out weak financial firms, we should be liquidating them. All doubtful assets need to be written-downs. We need accurate and transparent accounting. Government can help in this effort by cleaning up our accounting system. But it needs to stop being an investor propping up those that should be in the morgue. It needs to conservatively regulate all financial instruments. It should foster liquidity and stoke demand.

Description: Many life and health insurers are beginning to use Predictive Analytics (PA) for a variety of purposes. This article addresses the unique challenges and potential disruption PA brings to the risk manager, as well as the opportunities.

Description: In this article, a numerical comparison of two commonly used FIA valuation methodologies is conducted to help insurers decide on the best methodology to use under GAAP LDTI and VM-22. We compared two modeling approaches to project the future index credits with the annual point-to-point crediting formula: Tthe stochastic equity crediting model and the deterministic option budget crediting model. The analysis is then extended to different levels of option budgets and the monthly average crediting formula. The advantages and disadvantages of the two equity return projecting approaches are also highlighted and will be discussed later in the report.

Description: How insurers can include a liquidity score and liquidity stress scenarios as part of their asset liability management (ALM) protocol.

Description: Article from Risk Management Newsletter, July 2006, Issue 8 announces the SunGard/IAFE Financial Engineer of the Year for 2005. This award acknowledges Dr. Boyle’s lifetime contributions and accomplishments in the field of financial engineering. Not only is Dr. Boyle a financial engineer and a professor at the University of Waterloo, he is also an actuary— FIA, FCIA, Hon. FSAI. While Dr. Boyle is best known for pioneering the Monte Carlo methods in quantitative finance, he has also made significant contributions in other areas including actuarial science and insurance.

Description: Chairperson’s corner in which the Chairperson talks about the diversity of issues in ERM.

Description: Many life and health insurers are beginning to use Predictive Analytics (PA) for a variety of purposes. This article addresses the unique challenges and potential disruption PA brings to the risk manager, as well as the opportunities.

Description: Fiduciaries play a vital role in the financial health of a pension plan. How they carry out their duties is a question of increasing interest to beneficiaries, regulators, shareholders and taxpayers. Having a clear, logical and well-documented risk management process in place can make a big difference.

Description: In this article, the author examines five common perspectives on risk and see how they affect not just each participant’s own choices but everyone else’s choices, as well.