Current Issues in Life Assurance (CILA) Webinar series

12.00-13.00: Growing Pains: Taking the Strain

For annuity writers, a key challenge is the need to fund capital-consumptive new business strain (NBS) as a consequence of writing the business intended to fund future distributions.

Reinsurance, investment strategy and capital provision all have roles to play. Here, we:

• Examine success stories to-date and consider how NBS might impact future progression of the BPA market
• Look at how firms manage NBS and the other levers available to boost capital generation throughout the product lifecycle
• Consider how, with IFRS17 on the horizon, changes in reinsurance usage and management of accounting profits might change the story.

Speakers: Andrew Kenyon, Natwest Markets and Owen Griffiths

09.00-10.00: 2020 Mortality Developments Across the Profession

Mortality in 2020 is now dominated by one thing, although – in our future-focused world – the pandemic is just one of many mortality considerations.  In this session, three well-regarded mortality/longevity specialists provide an overview of:

• The mortality impacts and implications of COVID-19 – what we know, what we can infer, what we should be worried about;
• Recent and imminent CMI developments, including how the pandemic is affecting our thinking on the projections model and future investigations;
• More ‘future-focused’ work underway in the MRSC, looking at causal improvement models and risk taxonomy in particular as well as how research priorities have been affected by COVID-19. 

Speakers: Matthew Edwards is Chair of the CMI and co-leads the COVID-19 Actuaries Response Group; Steve Bale is a member of the Mortality Projections Committee and is coordinating the CMI’s COVID-19 response; Sacha Dhamani is Chair of the MRSC.

09.00-10.00: Are we in the Era of Actuarial Data Science Modelling?

A huge increase in data generation, data capture and data storage combined with significantly increased computing power is providing insurers with a unique opportunity to re-evaluate the value that their data can provide; and the technologies available to do that. Enabling actuaries to embrace modern day data science tools and to work closely with data scientists is an important link that could give strategic advantages to insurers in the further development of actuarial modelling software.  Looking forward, the actuary will continue to evaluate key sources of data and need to find ways to incorporate data science that uses state of the art machine- learning and data technologies together with the actuary’s business insights. We need to refresh our methods and make use of emerging technological advances. Some are turning to programming languages like Julia, Python and R; among others. With the rise of open-source execution environments computational notebooks, programming is becoming more accessible and easy to use. This provides an interesting alternative for actuaries to execute large amounts of statistical calculations and see the results with the latest data visualisation techniques. Join us for an exploration session on the use of data science in insurance companies today. 

During this presentation we will be exploring among other:

• Examples how insurers are making sense of and using new data sources and technologies
• Exploration of practical applications of data science within actuarial work
• The benefits of data-driven decisions to solve business problems using the power of data and technology
• The role that actuaries can play to harness the benefits of data science.

Speakers: Valerie Du Preez, Dupro Advisory and Rodwel Mupambirei, Lloyd's Banking Group

11.00-12.00: The Capital Management Toolkit 

Efficient capital management has become a key value driver and source of competitive advantage for life insurers, particularly with the flow of private equity money into the sector.

A range of innovative capital optimisation approaches have been developed, using capital markets or structured reinsurance.

This talk will look at a range of such techniques (e.g. mass lapse risk transfer, contract boundaries, risk margin relief, non-standard longevity risk transfer) that have been applied or considered by UK and EU insurers, and the pros and cons of each.

Speakers: Paul Fulcher and Tom Bulpitt, Milliman

09.00-10.00: Global Capital Standards – What does the Adoption of ICS v2.0 Mean?

The International Association of Insurance Supervisors announced on 14 November 2019 the adoption of v2.0 of the global Insurance Capital Standard (ICS) which will undergo confidential reporting for 5 years starting from 2020. This session will include specific experiences from Legal and General (L&G) as well as global industry perspectives from EY.

This session will cover the following:

• Introduction – what is the ICS, why does it matter and does it represent an opportunity or concern?
• Experiences from ICS field testing, including benefits of participation, how it informs lobbying, and ways to improve ICS reporting processes
• Global market perspectives on the ICS (covering Europe, Asia and North America), including how the ICS is influencing other solvency regimes
• What the future holds for the ICS

Speakers: Kenny Cheng, EY and Anthony Buck, Legal & General

12.00-13.00: Developing and Executing a Climate Risk Strategy 

This session will cover: 

• A brief overview of the demands of the PRA supervisory statement on financial impacts related to climate change
• Industry insights into PRA climate risk business plans – what are the emerging themes and minimum standards which we have observed?
• Snapshot of an example climate risk strategy setting out key workstreams and activity steps for successful execution
• Overview of a climate risk strategy execution timeline – turning planning and theory into practical reality
• What does the future hold? Deep dive into the steps for success in 2020 and pitfalls to avoid        

Speakers: Ryan Allison, EY and Sandy Trust