Tag Archives: Kevin Manning

Can the financial services industry help address Ireland’s homelessness crisis?

Ireland is in the midst of an affordable housing crisis. Figures published by the Department of Housing, Planning and Local Government show 6,497 homeless adults in late 2019 with a further 3,778 homeless children. In total, 1,721 families were in emergency or temporary accommodation including hotels, bed and breakfasts, hostels, and other temporary accommodation facilities. In addition, a large number of people are in private rental accommodation, relying on local authority assistance in paying rent.

A shortage of housing supply seems to be at the crux of the problem, particularly in the context of increased demand arising from improved economic conditions and an increased number of large multinational employers. Harnessing the power of pooled investment funds could help alleviate this crisis while also potentially providing returns to individual investors.

The proposed pooled investment fund would:

  • Build a portfolio of residential properties, through acquisition and/or development. Initially, it is likely that the focus of the fund would be on purchasing residential properties, but development of suitable residential properties would also be possible over time.
  • Rent those properties on long-term secure tenancies with transparent rules around rental increases either to tenants directly in receipt of the Housing Assistance Payment or directly to local authorities to supplement the local authority housing stock.

In this paper, Milliman consultants discuss the rationale for a pooled investment fund focused on social and affordable housing.

Brief study of UK health insurers’ second SFCRs

This analysis by Milliman consultants compares information provided in Quantitative Reporting Templates (QRTs) and Solvency and Financial Condition Reports (SFCRs) and draws conclusions about the balance sheets and risk exposures of 15 UK private medical insurance and health cash plan providers. The analysis also highlights noteworthy trends between the 2017 and 2018 publications.





Analysis of health insurers’ Solvency and Financial Condition Reports in Europe

Under Solvency II, European insurers are required to publish their Solvency and Financial Condition Reports (SFCRs). Two sets of SFCRs have been published, with the first publication for most entities occurring in May 2017 and the second one in May 2018.

The SFCRs contain a significant amount of information including details of the company’s performance over the reporting period, system of governance, risk profile, valuation basis and capital requirements. In addition, the SFCRs include a number of Quantitative Reporting Templates (QRTs) providing details of the company’s financial position under Solvency II.

This analysis by Milliman consultants compares information provided in the QRTs and SFCRs and draws conclusions about the balance sheets and risk exposures of European health insurers. It also highlights substantial trends between the 2017 and 2018 publications.





Investment strategy considerations under Solvency II

The introduction of Solvency II has led many insurers to reevaluate a range of strategic questions. One such consideration for insurers is whether their existing investment strategies remain optimal, or even appropriate, under Solvency II.

Investment strategies can change for a variety of reasons. The change from Solvency I to Solvency II is a sufficient change in the regulatory environment to have material knock-on implications for investment strategy. The key drivers of this are probably threefold:

1. Changes in the liability valuation basis under Solvency II have resulted in a change to the liability profile.
2. Relaxing of asset restrictions that were in place under Solvency I but are replaced by the Prudent Person Principle under Solvency II.
3. Capital requirements are now different under Solvency II.

In addition to these key drivers, there are many factors that can influence investment strategy. For example, market conditions have changed and risk appetite may have changed.

Milliman consultants Kevin Manning and Eamon Comerford carried out an analysis of the potential return for a range of assets compared with their Solvency II Standard Formula Solvency Capital Requirement. They explore how closely these capital requirements aligned with the risks underlying those assets. Kevin and Eamon also considered a number of alternative assets that may be interesting to insurers, as well as different risk mitigation options.

To read more about investment strategy under Solvency II, read the report “Investment strategy under Solvency II”.





ILS considerations for the life insurance industry

In this paper, Milliman’s Kevin Manning and Eamonn Phelan and Secquaero’s Scott Mitchell explore the reemergence of insurance-linked securities (ILS) in the life industry. They also discuss how ILS can benefit life insurers and reinsurers in the context of the evolving regulatory and accounting environment as well as the increasing focus on proactive management of risks, capital, and liquidity.





European Parliament rejects Level 2 regulatory technical standards, but this is not the end of PRIIPS

Murray-KarlOn Tuesday, 13 September, I participated in a panel discussion on packaged retail and insurance-based investment products (PRIIPs), along with Kevin Manning, a principal from the Milliman Dublin office. The event was cohosted by Silverfinch and Maples & Calder in London. Attendees of the event, including a mix of insurers, asset managers, and data providers, expressed various views on the potential outcome of the vote by the European Parliament on the PRIIPs Level 2 regulatory technical standards (RTS), scheduled for the following day, and the possibility of a delay.

Kevin Manning
Milliman Principal Kevin Manning offered perspective regarding the European Parliament’s vote on the PRIIPs Level 2 regulatory technical standards (RTS).

Yesterday, the European Parliament backed the view of the Economic and Monetary Affairs Committee to reject the Level 2 RTS for implementing the new PRIIPs legislation, on the basis that the RTS did not protect PRIIPs consumers. While many of the attendees at the panel discussion the day before had predicted this outcome, most contributors highlighted the need for clarity on the road map for PRIIPs implementation—something that yesterday’s vote did not deliver.

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