Confined by limited data, the aggregation process is typically riddled with volatility that can skew the view of an entity’s risk and capital needs. What has long been missing, at least until now, is a reliable benchmark for identifying and quantifying the risk dependencies between segments that underlie the loss aggregation process. Understanding risk dependencies between segments is a fundamental part of the process in forming conclusions about the interaction of loss distributions. With the introduction of new claims variability guidelines, actuaries can gauge the reasonableness of their correlations against benchmark correlations. Milliman’s Mark Shapland offers some perspective in this article.
In May, the new General Data Protection Regulation (GDPR) was issued. The GDPR strengthens rules regarding the way in which companies use data and should enable individuals to have a greater level of control over what companies do with their personal data.
The GDPR is applicable across the European Union, and as such all UK companies should currently be complying with the regulation. There have been many papers about the legal aspects of the GDPR. But few papers have covered the practical realm of how to design a risk management framework that insurance companies can use for the GDPR and data protection risk analysis.
Data protection is important to all types of businesses:
• Collecting, sorting and analysing data is unavoidable, whether it involves handling policyholder data directly or collecting personal data of a company’s employees or clients.
• There is a high price to pay for any error or breach of data, both in terms of direct remedial costs such as regulatory fines and additional staff, or ongoing reputational consequences which damage ongoing business performance.
In this paper, Milliman’s Claire Booth, Tanya Hayward and Peter Moore walk through the high-level requirements of the GDPR and also detail specific considerations on the implementation steps. They provide an overview of the new GDPR rules, discuss the aspects that firms should consider in light of these changes and explore the implications of the GDPR for a firm’s risk management framework.
The potential cost of cybercrime is difficult to fathom, especially given the lack of historical data and the pace at which the methods of attack are evolving.
That’s why Milliman combines advanced risk management approaches, including machine learning, to deliver rapid response solutions that help you identify tomorrow’s threats and manage them successfully.
The reality is that cybercrime will continue to grow more frequent, more furtive, and more pervasive, requiring companies to adapt to risks as they emerge. As leaders in the field of enterprise risk, we can help you prepare for what’s coming.
Milliman consultants provide more perspective in the following video.
As the financial effects of Hurricane Florence slowly reveal themselves, it’s likely that the storm will indirectly change some aspects of the property insurance industry and market in the Carolinas. In this article, Milliman’s John Rollins and Nancy Watkins examine the four ways listed below that Florence may alter the insurance landscape.
1. Florence may heighten the urgency for legislative and industry change to increase flood insurance protection across the region and beyond.
2. Florence may provide unprecedented data on wind and flood damage, changing catastrophe models and affecting insurance company strategy.
3. Florence could change the “market of last resort” in affected states.
4. Florence may push established insurers to reduce regional exposure, leaving room for an influx of local specialists.
Milliman today announced the launch of Pixel™ for flood insurance at this year’s InsureTech Connect conference in Las Vegas. Pixel is Milliman’s market analysis platform for personal residential and now flood insurance.
The web-based, interactive premium comparison tool incorporates Milliman market baskets, geospatial information, subject matter expertise, and advanced analytics to help insurers make informed decisions and drive profitable market growth. Businesses are able to view not only their own data in Pixel, but to also license Milliman’s market baskets, which include competitor premiums for hundreds of thousands of policy profiles, all calibrated to represent various state markets for both flood and residential property insurance.
Startups and smaller companies are interested in entering the growing flood insurance market, but lack the volume of data to price competitively. Pixel for flood provides the data, advanced analytics, and visualization tools needed for sophisticated feasibility, pricing, underwriting, and profitability analyses no matter the size of your business.
Pixel for flood is just one of the many Milliman insurtech products that will be featured at InsureTech Connect this year in Las Vegas. Visit us at booth 607 in the MGM Grand Conference Center.
To learn more about Pixel, click here, or watch the following video. To learn more about Milliman’s insurtech products, visit Milliman’s website.
International Financial Reporting Standard (IFRS) 17 embraces a marketing value accounting concept under which insurance contract liabilities are constantly updated to reflect environments at the reporting date. It also has a deferral accounting aspect. These features are anticipated to replace the roles that embedded value (EV) disclosure has been taking. However, as the insurance contract valuation by IFRS 17 is very complex, simpler market value accounting approaches like EV disclosure will be still more useful in some situations. This paper by Milliman consultant Takanori Hoshino compares the valuation approaches between IFRS 17 and EV and infers a potential future of EV disclosure.