Andrew Cox, Capital Optimization, Guy Carpenter, and Niall Clifford, Financial Strategy Group, Mercer, explore a number of reinsurance solutions available to insurance companies in the fourth video installment of the Holistic Balance Sheet Management series.
Whether using the Solvency II standard formula, undertaking specific parameters using the standard formula or an internal model, there are a range of solutions to achieve corporate goals. It is necessary, however, for insurers to be fully aware of how they measure risk in order to make choices about the types of reinsurance cover that would offer the greatest benefits. When considering solutions it is important that insurance companies focus less on what the upfront cost is for each structure and more on how that product will help balance their overall risk portfolio and the benefits it will bring in the long-term. The solutions may be prospective, such as quota share, excess of loss and stop loss, or retrospective, such as loss portfolio transfer (LPT) and adverse development cover (ADC).
Guy Carpenter & Company, LLC provides this post for general information only. The information contained herein is based on sources we believe reliable, but we do not guarantee its accuracy, and it should be understood to be general insurance/reinsurance information only. Guy Carpenter & Company, LLC makes no representations or warranties, express or implied. The information is not intended to be taken as advice with respect to any individual situation and cannot be relied upon as such. Please consult your insurance/reinsurance advisors with respect to individual coverage issues.
Readers are cautioned not to place undue reliance on any historical, current or forward-looking statements. Guy Carpenter & Company, LLC undertakes no obligation to update or revise publicly any historical, current or forward-looking statements, whether as a result of new information, research, future events or otherwise.
Statements concerning tax, accounting, legal or regulatory matters should be understood to be general observations based solely on our experience as reinsurance brokers and risk consultants, and may not be relied upon as tax, accounting, legal or regulatory advice, which we are not authorized to provide. All such matters should be reviewed with your own qualified advisors in these areas.
This post or any portion of the information it contains may not be copied or reproduced in any form without the permission of Guy Carpenter & Company, LLC, except that clients of Guy Carpenter & Company, LLC need not obtain such permission when using this post for their internal purposes.
The trademarks and service marks contained herein are the property of their respective owners.