About this event
Thank you to everyone who attended the IFoA Asia Conference 2017. We were delighted to meet you all and hope to see you next year in Bangkok.
- Registration Thu, 11/05/2017 - 08:00 - 08:45 Registration
- Plenary session Thu, 11/05/2017 - 08:50 - 09:20 Welcome
- Plenary session Thu, 11/05/2017 - 09:20 - 10:15 Plenary 1 - Professionalism Lecture Series 2017
Key note speaker: Dr Moses Cheng, Chair of the Independent Insurance Authority, Hong Kong
Dr Cheng will be delivering the keynote address at the conference. This session is also part of the IFoA ‘Professionalism Lecture Series 2017” which is designed to promote debate around the importance of professionalism, and the role of professionals, including actuaries and others, across the financial services industry.
- Refreshments Thu, 11/05/2017 - 10:15 - 10:45 Morning Refreshments
- Workshop Thu, 11/05/2017 - 10:45 - 11:35 Workshop Sessions A
A1: The Future of Motor Insurance. What Lies Beyond the Horizon?
The changing landscape of motor insurance continues to present challenges and opportunities. In particular trends in digital distribution, social media, telematics, driverless car technology and the potential future role of motor manufacturers, retailers, internet companies and other players are making motor insurance as exciting as ever. In this presentation we will cover the main current trends and developments around the motor industry and discuss how this may disrupt the whole motor insurance market, affect insurance companies, customers and distribution. We will also be discussing some of the challenges and critical success factors from emerging technology in insurance, in Asia and worldwide.
Speaker: Rob Malattia, Willis Towers Watson
A2: Evolving Investment Strategies to Optimise Risk-Based Capital
This session will discuss the key insurance investment trends across Asia, based on our insights gained from working across the region. Case studies of capital-efficient investment strategies implemented by Asian insurers including:
- Investment manager “alpha”, through investment in risk-based, outcome-focused, funds
- Private market “illiquidity premium”
We will set out how insurers assess the return, risk and capital implications of new investment strategies, and share our practical experience of implementing these strategies for Asian insurers.
Speaker: Iain Forrester, Standard Life Investments (UK) and Dongyue Zhang, Standard Life Investments (Hong Kong)
A3: Capital Modelling to Capital Management; Learning from Solvency II
As Hong Kong looks to introduce its own Risk Based Capital (RBC) scheme this talk looks at some of the effects of the introduction of Solvency II in Europe and what can be learned here. Though it avoids difficult to quantify risks like operational or catastrophe risk, European P&C companies can look favourably on the simpler technical specifications of the RBC regime. However, it is possible to look to some benefits that have come from Solvency II without importing the regulatory complexity. There are advantages of greater intra department collaborations and increased capital efficiency and this talk presents a few examples
Speaker: Daniel Grace, Willis Towers Watson
A4: How is the Japan Life Insurance Industry Responding to Negative Interest Rates?
The presentation will cover the impact of negative interest rates on the Japan life insurance industry, and comment on the actuarial issues created by this outcome. The impact has been felt in policyholder behaviour, in product strategy, product pricing, in investment strategy, in preparations for an economic-based solvency standard and even in the practical ability of models to accommodate negative rates. It has also highlighted how a central bank's policy can conflict with the objectives of financial regulators. The experience of Japan can prove useful to other countries whose rates are also trending lower, and potentially towards such extremes. Some parallels will be drawn with European and other Asian countries.
Speaker: Des Thomas, MetLife Insurance K.K
A5: A Proxy Model for Capital Allocation in Business Planning
The topic is to introduce a proxy model of implementing Bayesian model and Optimisation technique to help insurance companies to optimise capital allocation in the business planning process.
We present a proxy model for all type of liability products cash flow. The new business sales and investment return assumptions are controlled by the 4 hidden states of the economy, i.e. recession, boom, and the two transition periods. We want to find out the optimal sale volume target for each product line in order to maximise the “defined total profit” within N years, subject to the capital constraint. As the full distribution of the profit and loss (P&L) information will be available, the senior management can see both upside potential and downside risk of the P&L. The parameters of the process need to be calibrated to the company specific features and incorporate management input and to be revised when new data become available.
Speakers: Yizhou He, Aviva Plc and Feifei Zhang, KPMG
- Workshop Thu, 11/05/2017 - 11:40 - 12:30 Workshop Sessions B
B1: Challenges and Opportunities in the Asian Retirement Space
The presenters will highlight the current landscape of retirement income in Asia, any potential unmet needs, and subsequent opportunities for private providers. The presentation will include a discussion of potential product offerings, with examples from other countries, and the key competencies that may need to be developed to play in this space.
Speakers: Richard Holloway and Wade Matterson, Milliman
B2: Pricing, Reserving & Capital Management with 'Big Data' - Fact or Fallacy?
The session will provide hands-on, practical advice of how to utilise 'Big Data' for Asia-based GI actuaries working in Pricing, Reserving and Capital areas. By way of example and by case study, I will discuss pieces of 'Big Data' that have helped me in each of Pricing, Reserving and Capital, but also where 'Big Data' has hindered and mislead me.
- Pricing: examples of using 'Big Data' to improve risk selection
- Reserving: how to use 'Big Data' to implement leading indicators to help manage and communicate reserve risk
- Capital: using 'Big Data' to improve your understanding of the distribution's tail-end
Some of these examples are innovative; others will be older GI topics that are refreshed and reinvigorated with 'Big Data': using Big Data is not necessarily as challenging or as complex as you might think! The session will focus on areas most relevant to Hong Kong and Asia, plus offer a current UK perspective on this topic.
Speakers: Martin Noble and Jacob Craigie, Zurich Insurance
B3: How Technology and Robo-advice is Changing Consumer Behaviour and Disrupting Long-established Models: A Case Study
The way consumers interact with financial services is changing rapidly, threatening some long-established business models. A new generation of disruptive technology is combining the latest technological advances with insights from behavioural economics. One such development is “robo-advice”, making financial assistance more readily available to those who won’t or can’t use an adviser. Hear how one such development is harnessing sophisticated stochastic modelling and data in a manner that’s transforming the savings behaviour of consumers.
Speaker: John Taylor, Hymans Robertson
B4: Panel Discussion: What Motivates Our Career Decisions?
The panel will discuss how actuaries could
- Shape their career
- Build resilience from industry challenges
- Take steps to proactively own their career
Speakers: Yanum Venkatrathnam, RGAre, Ka Man Wong, AXA, John Chen, Swiss Re China, Mark Saunders, AIA Group
B5: Can Actuaries Stay Relevant? – Real-Life Investment Case Studies.
The global insurance industry faces significant economic, regulatory and technological headwinds. Traditional business models may require re-designing if insurers are to add value for their clients. This situation presents the global actuarial profession with challenges if it is to remain relevant.
We discuss how actuarial ideas are being applied in the insurance investment arena, to design and implement innovative asset solutions and to enhance insurance asset manager capability.
Real-life case studies are provided including: risk managed funds, absolute return investing, private market assets and insurer client support.
Speaker: Dr Bruce Porteous, Standard Life Investments
- Refreshments Thu, 11/05/2017 - 12:30 - 13:30 Lunch
Thank you to Standard Life Investments, sponsors of the lunch.
- Workshop Thu, 11/05/2017 - 12:30 - 13:30 Lunch Workshop: The IFoA’s Actuarial Research Centre (ARC): Delivering Industry Relevant Research
Big data? Ageing population? Low inflation? Climate change?
What do you think are the key questions in actuarial science? Where do you think your own profession should be investing its research efforts?
In 2016, the IFoA’s Actuarial Research Centre (ARC) was transformed as the delivery vehicle for the IFoA’s commissioned research programme. The ARC is now running large, long term research programmes that are seeking to address some of the significant issues in actuarial science today.
Bring along your lunch to find out more about the ARC and have your say on what you think the ARC should be researching next.
Speaker: Shaun Wang, Associate Director of the IFoA’s Actuarial Research Centre
- Plenary session Thu, 11/05/2017 - 13:45 - 14:40 Plenary 2 - To be confirmed
This session will be confirmed the week of the conference.
- Workshop Thu, 11/05/2017 - 14:45 - 15:45 Workshop Sessions C
C1: Business Ecosystems and the Digital Dynamic
Insurtech describes a fusion of insurance, health and wellness, and technology. It is an intersection on the innovation trends around what is now dubbed Insurtech. New discoveries across multiple disciplines converge to enhance daily lives, even as they upend established business models.
In this presentation, we will explore the most recent innovations in traditional and non-traditional data acquisition and potential impact on risk assessment and underwriting.
We will also address the growing trends in product development around bundling insurance products with enabling technologies and services. Here we will zoom into the ecosystem considerations and integration of insurance product with customer engagement elements.
Speaker: Georgio Mosis, RGAx
C2: Understanding Cyber Risk Mitigation, Quantification and Importance of Data Integrity and Provenance
This session will present a paper about the understanding and mitigation of cyber risk prior to any risk transfer. It looks beyond just data breach to critical infrastructure and global supply chain. Encompassing a host of sub topics around risk management, origins of cyber risk management in Estonia , cyber insurance, provenance of big data and healthcare. Case studies will be provided. There will be emphasis on cyber insurance pricing and how the mitigation presented can affect the combined ratio of an insurer from the aspect of the reduction of claims fraud, reduction of data breach, litigation and other expenses plus increasing EP (earned premium) by the creation of new products and operational efficiency of processes. Concluding with some predictions on the future and introduction of a new data integrity standard.
Speaker: David Piesse, Guardtime
C3: IFRS 17 is here - so What are our Strategic Opportunities?
IFRS 17 is the biggest ever change to accounting for insurers. While many actuaries are grappling with the modelling and accounting implications, we turn to the strategic implications. Those insurers that can capitalise on new opportunities in product development, asset-liability management, and even M&A opportunities that will arise in the light of this far-reaching standard stand to gain from the significant investment and the new insights generated from reporting the numbers. Presenting with an investment analyst, we will illustrate the investor view, and also the strategic view of the new Standard from the perspective of life insurers.
Speakers: Chris Hancorn, PwC, Matthew Donnery, PwC, Jenny Jiang, Morgan Stanley Asia
C4: Life Product in Low Interest Rate Environment
There is a general consensus that the current low interest rate environment constitutes the main risk for insurance industry. This is mainly due to two generic characteristics of insurers’ business models: (i) the large amount of fixed-term investments that insurers have on their balance sheet; and (ii) the strong influence of long-term interest rates on the discount rate of insurance liabilities.
Moreover, the life insurance business is often characterised by the presence of products embedding financial guarantees, i.e. instruments granting a minimum rate of return to policyholders. In times of low interest rates, this business model might represent a threat to the profitability and the solvency of life insurance companies, especially in countries where products with relatively high guaranteed returns sold in the past still represent a prominent share of the total portfolio.
Speaker: Jamie Zuo, China Taiping Life Insurance (Hong Kong) Company Limited
C5: A Positive Approach to a World of Negative Rates
Since the global financial crisis, central banks worldwide have consistently adopted loose monetary policies. This has brought a long period of low/negative interest rates; a challenging environment for insurance companies.
In this session we will discuss:
- How evolving macro-economic factors and regulatory changes have influenced long term investors’ asset allocations
- How technology and an integrated process can help long term investors make strategic/tactical investment decisions in a fast changing market environment - via a demo of our real time and digital ALM platform
- Case studies of innovative investment strategies aiming to improve capital adjusted returns; including multi-asset, absolute return and global diversified beta etc.
Speaker: Muqiu Liu and Yang Yu, Redington
- Refreshments Thu, 11/05/2017 - 15:45 - 16:15 Afternoon Refreshments
- Plenary session Thu, 11/05/2017 - 16:15 - 17:00 Plenary 3 - Regulation of Insurance when there is Asymmetric Information
Sir Mirrlees will offer an insightful discussion and understanding of the regulation of Insurance when there is Asymmetric Information.
Speaker: Professor Sir James Mirrlees, Nobel Prize Winner and Economist
- Networking Thu, 11/05/2017 - 17:00 - 19:00 Conference Networking Drinks Reception
Join us for an evening of networking, drinks and canapes which will be served on the pool side terrace allowing you a beautiful view of the Hong Kong skyline.
Thank you to CAS, sponsor of the networking event.
- Plenary session Fri, 12/05/2017 - 09:00 - 10:00 Plenary 4 - An Actuarial View of Climate Risks
"A 2° C world might be insurable, a 4° C world certainly would not be"
(Henri de Castries, AXA CEO, May 2015)
Even though media coverage tends to focus on a 2o Celsius limit to global warming, climate risks have pervasive multiple impacts on the sustainability of most financial arrangements of interest to actuaries. The World Economic Forum list “Extreme weather events” and “Failure of climate change mitigation and adaptation” in the top 5 risks over the next 10 years.
The Financial Stability Board has highlighted that “without effective disclosure of these risks, the financial impacts of climate change may not be correctly priced – and as the costs eventually become clearer, the potential for rapid adjustments could have destabilizing effects on markets.”
The presentation will cover the current status and review both the physical impacts and the expected additional impacts resulting from decision makers initiatives. An Actuarial Climate Index launched on November 30th 2016 to raise awareness of the measurable physical impacts can be accessed in advance at www.ActuariesClimateIndex.org
Speaker: Yves Guerard, Former Secretary General of the IAA
- Refreshments Fri, 12/05/2017 - 10:00 - 10:30 Morning Refreshments
- Workshop Fri, 12/05/2017 - 10:30 - 11:20 Workshop Sessions D
D1: The Practical Issues of Why a More Comprehensive Risk Solvency Regime Does Not Suit Developing Markets
This session will mainly focus around the practical issues of implementing a comprehensive risk solvency regime in less developed markets. The speakers will share typical examples on both Pillar I (quantative) and Pillar II (qualitative) of C-ROSS trail implementation during their time with the CIRC and share discussions with Indian and African markets on changing the solvency regime to be risk-driven and discuss why it maybe difficult and not appropriate to go for a full-blown SII in one.
Speakers: Yi Yang, KPMG
D2: More Than Just a Big Idea: How Big Data and Deep Learning is Helping Japanese Insurers to Protect Homeowners from Natural Catastrophe Risk
The high natural catastrophe risk in Japan has driven the speaker's team in Aon Benfield to explore how Big Data can improve both underwriting and premium rating for homeowners, plus risk assessment in the country. The speaker will unveil their building exposure database for Japan that contains data for 65 million buildings. This includes critical characteristics such as roof type and condition; residential or commercial which are key differentiators in assessing post typhoon losses, the largest natural catastrophe risk in Japan. By combining specific big data sets, catastrophe modelling and deep learning, the session highlights how insurers, rating agencies and regulators can drill down to improve understanding of risk at the policy holder level. Actuaries and analysts will be able to glean a ‘behind the scenes’ insight into how this ultra-high definition risk assessment will shape their work on reinsurance buying and pricing plus wider risk mitigation strategies.
Speaker: Oriol Gaspa Rebull, Aon Benfield Japan
D3: New Insights into Customer Behaviour and Value
across a portfolio of life insurance contracts, no matter how sophisticated, have generally historically been based on extrapolation of data in a linear manner. Now, new modelling techniques borrowed from supply-chain management are enabling actuaries to give greater insight than ever of how customer behaviour might develop over time in a range of scenarios. These techniques combine the traditional 'experience analysis' view of policyholder behaviour with data from other sources, to enable a richer view to be obtained. But where the technique differs from other big data techniques is in the application of new software which looks at the policyholder view in a way that actuaries have not typically done before, and enables rapid insights to be obtained. We will illustrate the new technique, and also suggest a number of applications of the new technique to traditional actuarial work.
Speakers: Charles Garnsworthy and James Larmer, PwC
D4: Green Bond: Investing in Climate Change Solutions
The effects of climate change and the risks associated with a greater than 2 degrees rise are significant. An average loss of USD 4.2 trillion to the total global stock of manageable assets is estimated for the end of the century as a result of climate change. Investors have recognised these risks and costs to their investment, therefore they are making actions to address climate changes.
‘Labelled’ green bonds are bonds with proceeds earmarked for green projects and designated accordingly, is an effective discovery tool for investors to screen green investment opportunities with climate change benefits and environmental benefits.
Speaker: Sean Kidney, Climate Bonds Initiative
D5: The Future of Insurance and What Does It Mean to the Life/Health Insurers?
With the prevalence of smart devices, it is inevitable that the life and health insurers will need to keep up with technology to stay competitive. Some insurers have long started product marketing via social media as well as incorporating wearable technology into their wellness programs. However, are these sufficient to stay ahead of the game? Medical advancement in the area of self-diagnosis via smart phones also highlights a potential issue for the life and health insurers, who could be anti-selected by the consumers. This presentation looks into Peer-to-Peer Insurance as well as how some insurers have incorporated continuous underwriting into their products to stay competitive..
Speaker: Kay Shong, General Reinsurance AG
- Workshop Fri, 12/05/2017 - 11:25 - 12:15 Workshop Sessions E
E1: Motor Insurance in China
Motor insurance accounts for 73% of GI in China. Currently it is undergoing a de-regulation reform. The latest development of this reform is reported in this presentation. Some important features of the motor insurance in China are summarised and compared with more mature markets. Opportunities and challenges are analysed. Three scenarios for the future of motor insurance in China are predicted and contrasted. Some advice is given for new companies and foreign companies to adventure into the local motor insurance market.
Speaker: John Chen, Swiss Re
E2: China’s Supply-side Reform and the Application of Actuarial Science on the Insurance Industry
Instead of working solely on boosting the demand, China has turned its focus towards the Supply Side Policies. The advancement of quality and efficiency of the Supply side management stimulates the sustainable and solid economic growth.
This session will look at
- How Chinese insurance industry implement the Supply-side Policies
- Actuaries actively involved in the reforms
- The application and impact of actuarial science on China’s Supply-side Reform in the insurance industry
Speaker: Chubin Xu, Sunshine Insurance Group
E3: Global Macro Trend and Asia’s Tomorrow
After years of sluggish growth, global economy started to recover from the second half of the year with a strong momentum which we haven’t seen for a long time. In the first part of my presentation I will review the current situations of several major economies, US, Europe and China. Then I will to use our analytical framework to identify the main drivers behind the current recovery, on top of which we draw our conclusion about the sustainability of the recovery as well as implications for investment. I will also flag a series of risks to global economy and gauge their impact on growth outlook.
In the second part of the presentation I would like to draw audience’s attention to an important long-term issue, namely the rise of middle class in Asia. Through some interesting charts, I will show that global growth will continue to be gravitated towards the Asia-Pacific region.
Speaker: Le Xia, Chief Economist, BBVA,Asia
E4: Agricultural Insurance in Asia: A Growing Market
This session will explore the rapidly growing agricultural insurance market in Asia. An introduction will include an overview of Agricultural Insurance in Asia and a comparison to the established United States market. Which will include a discussion of the public/private relationship of insurers, an overview of the different types of policies and crops, and the basics of ratemaking. This will follow with a more detailed discussion of actuarial rating methodologies and the obstacles that are faced, such as lack of data and catastrophes. We will end with future expectations and questions from the audience.
Speaker: Carl Ashenbrenner, Milliman and Yifan Fu, Aon Benfield China
E5: Can Good Clients Be Found?- Using Big Data to Improve the Credit Risk Modelling
Fin tech has been booming in China. A lot of start-up companies have claimed that they have the ground-breaking technology to innovate, so that they can compete, even wipe out the traditional players. There are more 3000 p2p platforms; however the majority of the p2p platforms offer credits to the niche market where traditional banking and loan houses are not covering. The features of these risks are different from existing data and experience. Can traditional FICO model still work when quantifying these risks? Can the logistic regression be expanded? This presentation uses an example to try to explore a method using big data sources other than the traditional credit reporting system, and explain problems that need to be considered during modelling.
Speakers: Cynthia Yuan, Sunshine Group and Yuping Liang, Yurong Credit insurance company
- Refreshments Fri, 12/05/2017 - 12:15 - 13:15 Lunch
- Plenary session Fri, 12/05/2017 - 13:25 - 14:25 Plenary 5 - Professional Skills for Experienced Members
Speakers: Colin Wilson, President, IFoA and Derek Cribb, CEO IFoA
- Plenary session Fri, 12/05/2017 - 14:30 - 15:45 Plenary 6 - Panel Discussion: the Future of the Actuarial Profession in Asia
Speakers: Colin Wilson, President, Institue and Faculty of Actuaries, Brian Brown, President- elect, Casualty Actuarial Society, Tom Terry, President, International Actuarial Association and Jenny Lyon, President, The Actuaries Institute, Kevin Lee, President, Acturial Society of Hong Kong.
- Plenary session Fri, 12/05/2017 - 15:45 - 16:00 Conference Close
- Refreshments Fri, 12/05/2017 - 16:00 - 17:00 Farewell refreshments