Spencer Gluck, Senior Vice President
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The last bout of serious inflation in the United States occurred in the late 1970s. In casualty insurance, high inflation coincided with deteriorating reserves and underwriting results. Many believe that the risk of future inflation is higher than it has been in many years. If rising inflation levels impact settlement of claims that are open or are currently unreported, then increased inflation risk leads to increased reserve risk.

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Spencer M. Gluck, Senior Vice President
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The merits of enormous stimulus packages are being debated while enormous budget deficits are on the rise. How long will their impacts last? When - if ever — will there be the political will to rein them in? Is there a serious bout of inflation in the future? No one can pretend to know the answer to these questions, and it may be futile to enter the debate. But what is not debatable is the tremendous economic uncertainty faced today. There may be uncertainty about whether inflation will rise, but there is no doubt that the risk of future inflation is at a level not seen in a generation.

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Susan Witcraft, Managing Director
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The co-TVaR report in MetaRisk gives analysts easy access to valuable information to illuminate the Enterprise Risk Management (ERM) and capital implications of reinsurance. Using co-TVaR for risk decomposition, one can develop a fuller view of the factors that contribute to company risk, ultimately delivering a more compelling case for risk-related decision-making.

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Donald Mango, Chief Actuary
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The financial catastrophe currently tearing through financial markets has changed the face of risk. Diversification, once the standard for reducing exposure, has been weakened by a convergence of threats on both sides of the balance sheet. (Re)insurer capital is under assault, and a more robust risk management technique is needed. Enterprise Risk Management (ERM) may help the situation, offering an integrated view of portfolio perils and the tools necessary to develop an effective risk transfer strategy.

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