Description: Column on the latest Investment Section activities.

Description: This article addresses the concern that while risk assessment models are supposed to help identify and reduce risk, they can be a source of risk themselves. A new report released by the Canadian Institute of Actuaries in August 2008 helps address that potential problem by providing useful guidance to actuaries who are charged with designing, implementing and using advanced models.

Description: To address non-parallel movement in the interest rates the concept of key-rate duration was introduced in mid-'80s by Tom Ho. I will define certain key rate metrics, their variation used in the industry, how to calculate them, and an existing industry issue with how they are used. Additionally, I propose a novel technique to calculate key rates to mitigate the problem faced in the industry

Description: The Federal funds rate increased by 4.25% in 2022 with further increases in 2023, which have already resulted in a liquidity crisis for a few banks. As the rapid increase of the interest rates pushed the new money rates above the yields of many life insurers’ investment portfolios, insurance companies are facing a dilemma between compressed margins from peer pressure and the concern with liquidity shortfalls and realized capital losses should mass surrenders happen. This paper discussed main emerging risks under rising interest rate environment, and several ways to mitigate these risks.

Description: A closer look at the Reinsurance Loss-Recovery Component (RLRC) under IFRS 17

Description: To address non-parallel movement in the interest rates the concept of key-rate duration was introduced in mid-'80s by Tom Ho. I will define certain key rate metrics, their variation used in the industry, how to calculate them, and an existing industry issue with how they are used. Additionally, I propose a novel technique to calculate key rates to mitigate the problem faced in the industry

Description: This article discusses the Insurer Solvency Assessment – Towards a Global Framework report prepared by the IAA Insurer Solvency Assessment Working Party WP. The conclusions of the report are consistent with the three pillar approach to the regulation of financial service entities that is reflected in the Basel Accord for the regulation of banks internationally. The pillars are: Pillar I: Minimum financial requirements. Pillar II: Supervisory review process. Pillar III: Measures to foster market discipline.

Description: This article gives an overview of the CFO Forum diversification paper. The key points that the CFO Forum made are: 1. The lack of sufficient diversifying strategies for risk management needs to be addressed. Therefore they provided a policy framework that promotes sound risk measurement and management practices in a way that can be implemented and supervised with confidence. 2. The lack of sufficient regulatory over-site needs to be addressed, so they presented a set of core principles to form the basis of European insurance regulation. These core principle incorporate diversification in a consistent manner.

Description: This article suggests ways for small insurance companies to obtain modeling information on more intricate assets, such as collateralized mortgage obligations [CMO], at a low cost.

Description: This article addresses the serious consequences of non-compliance with Sarbanes-Oxley.