Life Conference 2020 Webinar Series

Monday 16 November

14.30 – 15.30

AI in an actuarial world: training a machine to assess matching adjustment eligibility 

Machine learning is changing the way we operate. In this presentation, Deloitte and Eigen Technologies, a provider of natural language processing (NLP) technology with the ability to extract answers from documents, will share their experience on using NLP in the assessment of matching adjustment eligibility. We will cover:
•Roles of Deloitte and Eigen
•The challenge of managing MA eligible assets
•Introduction to ML/NLP
•Insight into the pilot including:
    -Pre-work, training the machine, seeing the results, preparing the final  output (for the investment manager)
   -Challenges/limitations and ways of addressing these in the future  where possible
   -Benefits
•Looking to the future: other possible uses for ML in Life Insurance 

Speakers: Rachael Armitage, Deloitte and Simone Bohnenberger-Rich, Eigen

Tuesday 17 November

09.30 – 10.30

With-Profits - current areas of focus: A panel discussion.

This session will be focused on a four person panel discussion, sharing their own perspectives on some of the key focus areas for the management of with-profits funds, taking questions from attendees. To provide some initial areas of discussion we will start the session by sharing views on four topics: starting life as a with-profits actuary, value for money, run-off of closed with-profits funds, and approach for bonus setting for whole of life contracts.

Speakers: Catherine Thorn, ReAssure, Kris Overlunde, PwC, Jonathan Welsh, Wesleyan and Wei Tham, KPMG

Chair: Philippe Guijarro, PwC

14.30 – 15.30

Sustainability and climate change: I’d like to help – but I’m an actuary 

This talk from members of the Resource and Environment Board explores how actuaries can play a critical role in building a better future by tackling climate change and helping to accelerate the move to a sustainable financial system. But it can sometimes be hard to see how we can match our professional duties with an often heartfelt desire to make an active contribution to that better future. With regulators and policymakers having opened the door to sustainable finance, this talk explores how we might make decisions to accelerate the shift to sustainable finance, what the consequences might be for actuaries who fail to adapt and finishes by introducing the innovative actuarial ‘pledge for the future’.

Speakers: Sandy Trust, EY, Patrick Cleary, PRA, Matt Saker, Aviva and Wendy Walford, Legal & General

Wednesday 18 November

09.30 – 10.30

An alternative take on how to be 'professional' 

This talk will provide you with a different, and hopefully provocative perspective on what Professional Skills actually means to us as jobbing actuaries.

In particular, I'll be talking about:

The Actuaries Code - what does it mean in practice
The TAS's, and the APSs, and why some actuaries haven't read them
Drink Driving - is it really any of the Profession's business?
Social media - is it ok to tell someone on twitter that they are a ******* ******?
... and much much more!!!!

Speaker: Peter Heffernan and Rod Bryn-Hussey, PwC

14.30 – 15.30

Changes in insurers investment strategies 

Insurer’s asset portfolios have evolved dramatically over the last few years due to low yields, regulatory changes and a number of conflicting metrics to measure against. In this presentation, we aim to discuss current trends within the industry’s asset portfolios and possible future developments. Including:

• An overview of current asset portfolios and the metrics they’re measured against.
• A spotlight on some asset classes which are gaining popularity amongst insurers 
• How investment managers have responded / will respond to the changes in the wider business and economic environment
• The tools that can be used to monitor, optimise and rebalance an asset portfolio

Speakers: Richard Wilson, Charlie Hibbert and Sam Tufts, EY

Thursday 19 November

14.30 – 15.30

Weathering the Climate storm - creating an enhanced disclosure and climate scenario testing

To meet the requirements of SS3/19 (Enhancing banks’ and insurers’ approaches to managing the financial risks from climate change), one of our client’s embarked on a programme in 2020 to enhance its Task Force for Climate-related Financial Disclosure (“TCFD”) for its insurance business and asset manager and to undertake climate stress and scenario testing for select key funds. This presentation tells the story of that project.

Speaker: Dhiran Dookhi, Willis Towers Watson

Friday 20 November

12.30 – 13.30

IFRS17 – how do we explain ourselves better? Tackling analysis of change 

The introduction of IFRS17 brings new challenges for analysis of change, alongside an opportunity to rejuvenate tired practices and ensure finance is at the centre of strong business management. We will discuss the implications for IFRS17 and consider multiple use cases, broadening AoC out from a controls and compliance activity. We’ll bring insights from multiple IFRS17 implementations globally and market leading practical analytics.

Speakers: Patrick Rowland, Zaid Hoosain and Richa Mathur, KPMG

14.30 – 15.30

The greatest threat to with-profits 

With-profits has been quietly, successfully developing a niche on savings for low risk savers who look for a medium term return.  With-profit ISAs have been successful products for the (normally mutual) insurers who offer them.  Recurring single premium AWP whole life contracts in an ISA wrapper.Now, the low interest rate environment looks like it is becoming permanent.  End of April, 93.5p was needed to guarantee payout of £1 in 20 years. Forget equity volatility, low interest rates will be the killer of this type of business. What can be done and what changes are required in the product? If with-profits cannot survive, can mutual insurers?

Speaker: Stephen Dixon, Steve Dixon Associates LLP and Peter Green, Healthy Investment 

Monday 23 November

14.30 – 15.30

International Capital Standards - an Equity Analyst’s views on ICS and current solvency/capital 

The upcoming ICS framework will affect many global insurers. It has been adopted in Nov 2019 by the IAIS, and has the backing of international regulators (e.g. PRA). The Monitoring Phase has started and the Capital Requirement becomes effective in end 2024.

We commence with an overview of ICS, comparisons with Solvency II, and how it fits into the UK regulatory framework. We will cover issues and implications for life companies implementing ICS.  There will be updates from an insurance equity market analyst who presents her views on ICS, and also solvency/capital (on-going SII long-term guarantee review) across UK and EU markets, including impact from Covid-19.

Speakers: Fulin Liang, Morgan Stanley and Jo Thorpe, Gina Craske, KPMG

Tuesday 24 November

09.30 – 10.30

Assessing Model Drift – Do internal models accurately reflect the risks that UK life insurers face? 

The PRA regularly assesses the risk of internal model drift for UK life insurers; the risk that, over time, the SCR calculated using an internal model no longer remains reflective of a firm’s risks.

This workshop will highlight how PRA is using regulatory reporting information (i.e. QRTs, internal model outputs, and Standard Formula SCR for internal model firms) to assess potential model drift.

We will discuss;

• the different approaches for identifying unjustified weakening in firms’ SCR calculations, and the advantages and limitations of these approaches
• possible model drift trends observed across the UK life Insurance sector
• the different approaches taken by firms to monitor potential model drift

Speakers: Chintan Patel and Paul Collins, Bank of England / Prudential Regulation Authority

14.30 – 15.30 ( FULLY BOOKED)

ESG and climate change integration – the journey for life insurers

Most firms have started making progress in their journey to embed ESG considerations within their businesses. However, it is by no means an easy or straightforward to achieve full integration given to the nature of the risks involved and the constant evolution of information available. 

The presentation will cover the following, drawing on Phoenix’s own experiences:

• Recap on the importance of ESG integration;
• Regulatory developments and guidance available;
• What firms could learn from the recent COVID-19 pandemic;
• Key steps for integrating ESG into firm’s day to day activities;
• Challenges that life insurance companies may face; and
• How firms have overcome some of these challenges.

Speakers: Clarence Er, Hymans Robertson and Sindhu Krishna, The Phoenix Group

This webinar is sponsored by Hymans Robertson and is therefore free of charge to IFoA members and non-members.

Wednesday 25 November

09.30 – 10.30

Application of machine learning techniques to financial reporting 

The presentation will cover all stages of an advanced analytics project in Life Insurance, i.e. problem definition, data collection and analysis, modelling and results analysis, as well as lessons learned, and the challenges overcome. The project was completed jointly by Lloyds Banking Group and EY. The project addresses the common problem of volatility in financial reporting caused by irregularity in premium payments on savings products.  The purpose of the project was to build a model that will predict the level of future premiums on a policy. The team used a wide range of data sources, including policy and client data, employer data, historical scheme data, and third-party external data.Several machine learning algorithms were tested and compared. The highest performing model was fitted with an XGB (eXtreme Gradient Boosting) algorithm with a Bayesian hyperparameters optimisation procedure. We will cover the options considered and why this performed the best in this circumstance. 

Speakers: Rodwel Mupambirei, Lloyds Banking Group

Friday 27 November

09.30 – 10.30

Integrating ESG into long-term strategic asset allocation  

This webinar is sponsored by: 

Most ESG activity is focused on bottom up stock selection and Stewardship. But ESG raises long-term systematic risks for investors. Ageing populations and inequality affect interest rates, the climate transition impacts key sectors. It is important investors take them into account in their long-term asset allocation decisions. 

We have been working with our pension fund and insurance clients to integrate analysis of climate risks and other ESG factors into forecasts for long-term expected returns and strategic asset allocation. With think this will improve portfolio resilience while accelerating the shift of capital to climate solutions from legacy assets. This also helps clients meet new PRA climate regulations.

Speaker: Craig Mackenzie, Aberdeen Standard Investments

14.30 – 15.30 (FULLY BOOKED)

What's a 1-in-200 year stress when you're in a market downturn? 

The development of life insurers' Solvency II capital models occurred during a period where markets were much calmer than they've been in 2020. Were these models for investment risk designed with application during an economic downturn in mind? This talk will explore how actuaries might look to future-proof their capital models to make them fit for purpose under a wider range of economic conditions, and how doing so could impact an insurer's reported financial position.

Speaker: Shaun Lazzari, Legal & General

2030 – a view from the future - lessons in resilience and climate change risk management 

A look back at the exponential 2020s: the decade in which finance became sustainable, allowing humanity to veer away from the cliff edge of biosphere breakdown. This talk covers the key turning points of the decade – starting with how the COVID 19 lockdown showed world and business leaders that transformational “unimaginable” change in the face of a crisis was possible. We’ll discuss how these impacted life insurers, the commons characteristics of companies which emerged as winners and the pivotal role of the sustainable actuary in leading this seminal shift. Crucially we’ll put ourselves in the shoes of the actuary sitting in 2020 and work through the practical factors that, with the benefit of hindsight, would have best helped actuaries trying to make sense of how to help their companies survive that extraordinary decade.

Speakers: Russell Bowdrey, Aviva and Sandy Trust, EY

Covid-19 – where are we now? A medical and an actuarial perspective 

By the time of the Life Conference we will be 11 months on from the emergence of a novel coronavirus.  In this talk we will give a brief retrospective of what has happened to date and then take stock of the current body of knowledge at the time to inform the outlook for this pandemic in 2021, the longer-term impacts on mortality resulting from this pandemic as well as any learnings for future pandemics.

John O’Brien is a Chief Medical Officer and a Pulmonologist and therefore has a particular interest in disease with respiratory impacts.

Speakers: Adele Groyer and John O'Brien, Gen Re

IFRS 17: So far, but we have another year to 2023!

IFoA Financial Reporting Group members will:

• Provide an update on the IASB’s Amended IFRS 17 (due June 2020) and the EU and UK endorsement processes.
• Examine key issues for annuity and with-profit products in the UK life insurance market..
• Examine where insurers are in their implementation journey and the key challenging remaining to 2023.
• Provide an update on the IFoA and IAA responses to the IFRS 17.

Speakers: Anthony Coughlan, PwC, Kamran Foroughi, Willis Towers Watson and Darren Clay, Phoenix Group

Recent CMI activity: Implications of COVID-19 for future mortality 

An overview of the CMI's activity on COVID-19 including:

• How the pandemic is affecting projections: the CMI’s proposals for CMI_2020
• How the mortality of pension annuitants has been affected and
• The work of the CMI COVID-19 Working Party on setting assumptions in the context of COVID-19

This session will be very relevant to life actuaries who are involved in assumption-setting or experience monitoring for mortality, morbidity and longevity.

Speaker: Matthew Edwards, Cobus Daneel and Steve Bale

Shining a light on the “black box” of price optimisation

Price optimisation is emerging as a key theme in the world of life insurance pricing, particularly as insurers look for new ways to create customer and shareholder value through the lever of price. However, it is a complex subject that’s further complicated by industry jargon and competing perceptions of what it is and is not.  In this session we take a pragmatic look at the subject and explore:

• Definition of price optimisation
• How the use of optimisation can generate additional value for customers and shareholders
• How optimisation differs from other techniques
• Common myths
• The ingredients of an effective price optimisation model
• Different approaches
• Best practices

Speakers: Stephen Carlin, Montoux and Ewen Tweedie, PwC

Part VII transfers in the current environment 

An overview of Part VII transfers in the last year or so and some comments/observations on how things have changed and how tings may change going forward. 

Speakers: Oliver Gillespie, Milliman and Hammad Akhtar, Pinsent Masons LLP

Onboarding With-Profits: All in to last out 

With majority of with-profits funds now in run-off there is a clear trend of, and an increasing need for, consolidation of funds between companies. With increased regulatory scrutiny of the operation of with-profits business, being able to onboard and embed with-profits funds effectively is crucial to being able to successfully participate in this market.

Scottish Friendly has a strong history of acquiring closed with-profits funds. By looking at case studies from our recent experience, we will examine the key factors that have aided our success in acquiring and embedding the transferred business. We will discuss the perspectives of some of the key stakeholders, the challenges and the lessons learned.

Speakers: Craig Burns, Scottish Friendly and Stephen Makin, Hymans Robertson

GBP inflation & the RPI curve: A tale of two halves 

The RPI curve has been a tale of two halves with the front end reaching elevated levels whilst the back-end remains depressed. Last year, short end inflation expectations continued to be driven by Brexit uncertainty with possible RPI reform weighing on the curve further out. Whilst Brexit-related volatility subsided at the start of 2020, it will soon come back into focus. The COVID-19 pandemic assumed a temporary role in driving the front end as the oil crash sent front end valuations lower. The RPI consultation is seen as the main driver of the back-end, though with continued uncertainty and lack of supply, increased demand is seeing valuations drift higher. 

Speakers: Harriet Dunscombe; Carina Lindberg, Natwest Markets and Kelly Moohan, The Pension Protection Fund