General Insurance Convention 1986
Windermere, 1986
Assessing the solvency and financial strength of a general insurance company. Report of Solvency Working Party. - Daykin, Chris D; Bernstein, Geoffrey D; Coutts, Stewart M; Devitt, E R F; Hey, G Brian; Reynolds, David I W; Smith, P D. 88 pages.
A first report was presented to the Bristol Seminar in November 1983 and this led to a paper being presented to a sessional meeting of the Institute in February 1984. The Working Party was then reconstituted with its current membership and work began in earnest on setting up a simulation model of a general insurance company which could be used to explore further the problems of variability in both assets and liabilities and to develop work along similar lines to that carried out in Finland. The first results of this work were presented to the Cheltenham Seminar in October 1985.
The comprehensive simulation model has now been completed and formed the basis for papers presented to the International Conference on Insurance Solvency in Philadelphia, U S A in June 1986 and the ASTIN Colloquium in Tel Aviv in September 1986. The attached paper carries the work one stage further, with some modifications and refinements to the model and a more extended treatment of the issues raised in the consideration of solvency and the financial strength of a general insurance company.
Claims reserving manual. - General Insurance Study Group. 5 pages.
This is the draft plan for the Manual. Sections 1 & 2 are preliminary, and main headings only are shown. Sections 3 to 5 contain the meat of the work, and subheadings are shown as well.
It is intended that the discussion at Windermere should centre around two particular aspects of the work which are of great importance.
Commercial Fire Underwriting Working Party report. - Gillott, Nigel R; Carroll, Patrick S; Chamberlin, Gary F; Hudson, Brian D; Malde, Shailesh A; Masters, Graham A; Taylor, Philip K; Thomson, Andrew K. 79 pages.
The working party feel that the level of knowledge of commercial fire insurance is relatively low within GISG. This may be a relevant factor contributing to the recent decline in numbers of specialist general insurance actuaries within the larger composite companies. Actuaries may have entered the arena with some worthwhile ideas on reserving, statistical analysis and motor rating. However, while their ideas in these areas have been refined over the years, they have never made the important transition into the centre of the general insurance stage within the direct writing companies. This would involve contributing ideas within the commercial insurance field and considerable contact with underwriters. The members of the working party feel that actuaries have a lot to offer in this area. Others may agree when they see the wide diversity of thinking between actuaries and underwriters that is portrayed in the paper.
In many ways this is a "chicken and egg" situation. Actuaries cannot be helpful to commercial underwriters until they are involved in and understand the business; yet they are unlikely to be involved in the business unless they can be helpful to underwriters. It is hoped that this paper will be a start in helping to break the vicious circle.
With the above thoughts in mind the working party has produced this basic educational paper on commercial fire underwriting - a class of business which covers any property except domestic dwellings. Such business produces nearly £1 billion worth of premium in the UK alone. Although the paper does give background information, particular emphasis is given to areas where actuarial ideas could be most profitably employed. These could perhaps be developed in later papers. Similar work could also be usefully done in other areas of commercial insurance business.
Education at the crossroads. - Truckle, William W. 3 pages.
I believe we are at the crossroads, and we must act quickly and decisively to determine in which direction to point the education system. If we hesitate we will be unable to produce enough qualified actuaries to meet the potential demand for our services, and we will be overtaken by other professions keen to fill the vacuum.
The effect of the US legal environment on casualty insurance business. - General Insurance Study Group. 26 pages.
It soon becomes apparent to a new entrant to an underwriting organisation writing US casualty insurance business in the London market that the business is significantly different from the liability insurance traditionally written in the UK domestic market. It takes a little longer to appreciate to what extent this arises from the legislative framework against which the original business is conducted.
It is the intention of this note to explain the main areas relevant to casualty insurance in which the legislative environment in the US differs from that in UK. The note concentrates on casualty insurance, since in the field of property insurance the legislative environment is less significant.
General insurance business: Actuarial reports: NORP 1 (Notes on Recommended Practice). - General Insurance Study Group. 11 pages.
These Notes on Recommended Practice have been produced to assist actuaries working in the field of general insurance. They are restricted to general points that an actuary should take into account in reporting on reserves or on the financial soundness of a general insurance company. The notes do not cover other aspects of reporting in which an actuary may be involved, e.g. ratemaking. The intention is to issue further notes on reporting in a specific context as the requirements for such reports are identified.
Proportional treaties. - General Insurance Study Group. 32 pages.
This memorandum has been drafted to explain the considerations that must be taken into account when an Underwriter is presented with a Slip drafted to cover inwards reinsurance written by way of a Proportional Treaty and is asked to accept a line on the Slip.
Statement of recommended practice on accounting for insurance business (SORP). - General Insurance Study Group. 33 pages.
The Association of British Insurers has agreed to develop an industry statement of recommended practice (SORP) on accounting for insurance business. This is intended to apply to all enterprises underwriting insurance business in the United Kingdom but not to Lloyd's syndicates. In developing this SORP it is intended to deal with the following features which are unique to insurance business namely premiums, expenses, claims and unexpired risks. At a later stage other features will be dealt with which, although not unique to insurance business, require separate consideration to take account of the special characteristics of insurance business, e.g. investments. In developing the recommended practice outlined in this SORP it is relevant to establish the framework within which financial reporting by insurance enterprises operates.
The work of the General Insurance Committee. - Rushton, Ian L. 3 pages.
At its meeting on 12 May 1986 the Institute Council agreed that the General Insurance Committee should present an account of its activities to the annual GISG Convention. This is the first of such reports.