Description: The speaker will discuss the training of neural networks to compute future Greeks of liabilities (or options) without the use of nested stochastics.

Description: The speakers will discuss the replication of long-term options, including a discussion of issues such as liquidity, transaction costs, slippage, impact of policyholder behavior, and machine learning algorithms to improve hedge effectiveness.

Description: In this article, the author describes the skills needed for the Chief Risk Officer and he offers why actuaries may, or may not, be best suited to fill the role.

Description: Latest in our on-going series in which we have a candid discussion with one the insurance industry's most respected and high profile risk practitioners

Description: Editor's note in Risk Management

Description: Asset Liability Management (ALM) is a vital function in insurance operations, focusing on the strategic alignment of assets and liabilities to enhance risk-adjusted returns while ensuring compliance with regulations and fulfilling policyholder commitments. The rise of negative credit spreads poses a fundamental challenge to conventional ALM models, compelling insurance companies to reevaluate their investment strategies, hedging techniques, and risk management practices. This analysis indicates that negative credit spreads bring both considerable challenges and distinct opportunities for insurers. Although they narrow profit margins and complicate traditional spread-based investment approaches, they also offer potential for capital gains and alternative revenue sources for insurers willing to adapt their ALM strategies accordingly.

Description: The article argues that effective Enterprise Risk Management (ERM) should be tailored to fit a company’s unique characteristics rather than forcing a standardized "best practice" approach. Drawing from decades of experience, the author explains that companies often reject rigid ERM frameworks that don’t align with their business culture, risk philosophy, or strategic priorities. Key challenges include resistance to aggregate risk tolerance, formal governance structures, emerging risk management, and capital models that expose underperforming business units. The article suggests four steps for aligning ERM to a company: clarifying ERM objectives, understanding risk culture, leveraging existing risk management strengths, and committing to an iterative improvement process. A well-aligned ERM program can enhance strategic decision-making and resilience by being embraced rather than resisted.

Description: Our previous article, “Introduction of Cashflow Matching Strategic Asset Allocation (SAA) Framework,” introduced the concept and included a real-world case study that developed a liability-driven investment strategy for a single line of business (LOB) for a life insurer. This article expands the framework and the case study from a single LOB to simultaneously optimize asset allocation across multiple LOBs. It discusses how this multi-line SAA framework can enable an insurance company to efficiently tag its asset holdings to each LOB, identify opportunities in the public and private asset markets to enhance risk-adjusted returns, and develop a deeper understanding of the trade-off between the degree of cashflow matching and risk-adjusted returns across LOBs.

Description: Risk management techniques do not include system science. System science requires that the uncertainty of the world is incorporated into the results. The articles explains the difference between risk and uncertainty. Learn how risk practices create an overoptimistic view of future outcomes.

Description: This interactive webcast uses case studies and a new framework to show how retirement plans and practices can be fitted to best serve organizations’ missions and objectives, guided by data and analytics measuring their workforce impact.