General Insurance Convention 1980
Cambridge, 1980
Data collection. - Ryan, John P; Clarke, Harold E; Hudson, Brian D; Lyons, Graham E; Reid, David H; Sanders, David E A. 17 pages.It is not the intention and neither should it be the intention of this working party to provide draft material for a statistical plan for certain lines. Any such plan should be produced by groups of companies, the BIA and/or individual companies and in some parts of the world independent rationalising bodies such as ISO collect data for groups of companies. The purpose of this working party is to consider general principles and highlight possible areas of difficulty. We were mainly concerned with data for ratemaking purposes but it is obviously important to integrate these needs with data requirements for general management and underwriting administration purposes.
Expenses Working Party. - Thomson, Andrew K. 20 pages.The Working Party has produced four papers as follows:
- Expense loadings, costing and rating;
- Claims settlement expenses;
- General branch expenses in a home service office;
- Marginal costing.
The second paper is not strictly within the terms of reference but seemed to the Working Party worthy of inclusion in view of the new form of Department of Trade Returns.
Report of Working Party on Fluctuation Reserves. - Trayhorn, Mark E; Abbott, William M; Craighead, David H; Hunter, Ray J; Karsten, Henry P J; Oakes, M; Ryan, John P; Wilkinson, Richard C. 91 pages.The incidence and size of claims varies over time and part of this variation will be of the form of statistical fluctuations which do not affect the long-term outcome of the business but do have significant short-term effects on the claims experience. A fluctuation reserve is a reserve set up in the profitable years to meet the excess claims in the worse years. Obviously, one must also consider the question of solvency because claim fluctuations are part of the variation supposed to be covered by the solvency margin.The general approach used in this report is:1) Consideration of risk theory and its application in practice.2) Reference to studies preceding the setting up of the EEC solvency margin to determine the allowance made for claim fluctuations. A number of European papers updating and suggesting alternative methods of calculating the solvency margin have been considered.3) A detailed examination of the systems in those countries, principally Germany and Finland, which already have legislation regarding fluctuation reserves.4) Mention of some of the practical aspects such as taxation and reinsurance and consideration of further work required on this subject.
Working Party on DoT Returns. - Truckle, William W. 12 pages.The Insurance Companies (Accounts and Statements) Regulations 1980 come into force on 1 January 1981 and insurance companies will have to submit annual returns in accordance with these Regulations for accounting years starting on or after that date. These 1980 Regulations [1980 Regs] will materially change the format of the returns to be made to the supervisory authority, the Department of Trade [DOT], by insurance companies operating in the U.K. The DOT prepared a preliminary guidance note in January 1980 explaining the 'broad purpose and effect of the regulations' and will be providing more detailed guidance in due course.The purpose of this note is to outline the differences between the information to be submitted in the new-style returns from that currently required under the 1968 Regulations [1968 Regs.] This note deals solely with the Forms for non-life business and concentrates on those items likely to be of interest to actuaries. It should therefore not be taken as a complete guide to the 1980 Regs especially by anyone who will be closely involved in the production of the returns within a company.