Description: This article discusses unauthorized trading scandals — commonly referred to as “rogue trading”.

Description: This article demonstrates and explains the differences between the current Canadian and U.S. capital regimes on life insurance companies. The concept and framework of regulatory capital is first introduced and Canadian regulation capital requirements—minimum continuing capital and surplus requirements (MCCSR) and U.S. regulation capital-risk based capital (RBC)—is explained and compared.

Description: A critical step in valuing a company for the purpose of financial reporting is the computation of the market value of economic surplus (MVES). This article provides a novel approach to the valuation of MVES that is stable and reasonably immune to “market noise.” Current approaches to the calculation of economic surplus of an insurance company generally define such surplus as the market value of the assets (MVA) supporting the liabilities less the market value of liabilities (MVL). While MVA is observable in the market, MVL is typically computed directly, without regard to the underlying supporting assets. Subtracting MVL from any value of assets that changes with market movements results in an unstable surplus. Consequently, a surplus that is not fully reflective of market sentiment has been rejected by many. This same approach is further used in the calculation of market consistent embedded value (MCEV) when a balance sheet approach is used .

Description: Read the September 2019 issue of Risk Management, published by the Joint Risk Management Section. Newsletters provide practical information for the working actuary, articles on trends that impact sections and news about section activities.

Description: Recurring column that lists recent publications in risk management of note to readers.

Description: Strategic Risk Management was given lower priority in a recent survey of ERM Objectives. This article tells how the author believes that recent events have caused many to shift to a more short term focus and in the future there will be a shift back to a priority for the longer term view that stands behind Strategic Risk Management when the environment settles down and things again seem to be more predictable.

Description: In this article, the author gives an overview a number of Enterprise Risk Management ERM issues that arise when one considers the impact of income tax on a fair value accounting system.

Description: This article summarizes an emerging risk research project completed by the Joint Risk Management Section. The major categories of risks in the survey were 1. Economic, 2. Environmental, 3. Geopolitical, 4. societal and 5. Technological.

Description: In this article the author compares ERM issues, strategies and scenarios to the process of driving to work on a four-lane highway.

Description: This article memorializes Hubert Mueller, a close friend and colleague of the Risk Management section.