Brave new world - A survey of financial modelling in the UK Life Insurance Industry 2009
Over the course of the summer we interviewed 19 Life Insurers in the UK to understand their current thinking on the actuarial models they use for financial reporting and economic capital calculations; how they assess themselves and the modelling tools they use, along with the developments they envisage for the next few years in order to cope with emerging standards such as Solvency II, IFRS Phase 2 and Market Consistent Embedded Values.
Our findings highlight that the scope of Solvency II and other business priorities and how they impact actuarial models is overwhelming. From our conversations with insurers, there are many different approaches to the way that companies think about their modelling strategy. These range from those who are actively developing a clear and comprehensive strategy to those who are continuing with their current approach and making tactical changes to cope with Solvency II. In order to successfully meet these challenges insurers need to develop an appropriate strategy for actuarial modelling and demonstrate how this strategy will enable the company to deliver actuarial models that are fit for the brave new world.
