The Central Bank of Ireland has published a guideline and a set of frequently asked questions for insurance and reinsurance undertakings on Solvency II Directors’ Certifications. In this briefing note, Milliman’s Aisling Barrett and Ciarain Kelly explain what certifications are required from directors of insurance and reinsurance undertakings under Solvency II and how Milliman can help give comfort to directors in preparing to sign these declarations.
Milliman was named “Service Provider of the Year” for the third consecutive year at the Middle East Insurance Review’s 2016 Middle East Insurance Industry Awards (MIIA). The award recognizes Milliman’s leadership in the insurance and reinsurance industry, citing the firm’s unique multi-disciplinary consultancy services, its implementation of educational and professional initiatives, and noting Milliman’s work as “a catalyst for the betterment of the industry.”
We are honored to receive this award for the third year in a row. At Milliman we believe in offering innovative solutions that serve not only our clients but the industry and region as a whole. We thank the Middle East Insurance Review and the esteemed panel of judges for recognizing the leading work we do throughout the Middle East and North Africa.
Middle East Insurance Review is a monthly publication that aims to meet the information needs of insurance practitioners in the Middle East and North Africa region and the global takaful industry. The MIIA, now in its 3rd year, is heralded as the premier awards of the MENA region with a clearly defined criteria and a transparent process served by a panel of 20 distinguished Judges.
For more information about the awards, click here.
Join Milliman consultants for a deeper dive beyond the numbers in an exclusive webinar on the implications of the recently published study, Embedded Values in Asia 2015. The webinar will include a 20-minute presentation led by Milliman Principal and Consulting Actuary Paul Sinnott, followed by a brief Q&A session.
Date: Wednesday, 7 December
Time: 12 noon Hong Kong time
To confirm your participation please RSVP here before 28 November. Registered participants will receive a link to the webinar and local/toll-free numbers for most countries in the Asia-Pacific region a few days prior to the webinar.
In this report, Milliman consultants Jeremy Kent and Ed Morgan discuss some of the challenges in valuing insurance companies under the Solvency II framework. The authors also propose a possible valuation methodology to meet the needs of potential investors with a certain perspective in mergers and acquisitions transactions. Whilst under Solvency II a number of factors may influence distributable profits, the authors believe that the most important drivers, particularly in the medium to long term, will be the required level of Solvency II capital and the own funds available and eligible to cover it.
Financial firms are facing significant technical and resource challenges due to the upcoming European-wide Packaged Retail and Insurance-based Investment Products (PRIIPs) regulations. These regulations are aimed at improving comparability of investment products and reducing the risk of consumers buying products that don’t meet their needs. Embracing these changes could improve customers’ outcomes and their understanding of investment products. Milliman consultant Karl Murray offers some perspective in this Finance Dublin article.
Blockchain technology may offer insurance companies the security that they have only dreamed about. The technology’s security components enable users to quickly identify whether a stream of data can be “trusted” for accuracy or not. In their article “Blockchain: An insurance focus,” Milliman’s Michael Henk and Robert Bell explain the basics of the technology. They also explore the benefits and limitations that blockchain could have on insurers.
Here’s an excerpt:
Blockchain technology also has the potential to limit fraudulent claims. False billings and tampered documents are less likely to “fall through the cracks” if the data is decentralized and immutable, which will reduce the amount of erroneous claims payments. Utilizing this technology will enable insurers to lower their loss adjustment expenses and pass on that savings to consumers in the form of lower rates. Furthermore, if this technology becomes widely used, it can help mitigate identity theft and other cyber liability losses.
Identity theft is the fraudulent acquisition and use of a person’s private identifying information. Usually this is done in order for the perpetrator to realize a financial gain. Because the data is encrypted at the financial transaction level, the technology minimizes the amount of identifying information available in the blockchain, thus minimizing the risk of identity theft.
The encryption protocol utilized by the blockchain technology has the capability to limit cyber liability as well. Cyber liability is the risk that personally identifiable information will be compromised by a third party storing an individual’s data. Current practice is to store this data in a central location with software to protect against hacking. With this technology, it enables data to be run and stored based on the current blockchain without unencrypting the underlying data because the chain itself can be independently verified through separate nodes….
…As with any emerging technology, these potential benefits do not come about without a few potential limitations, in addition to the security concerns discussed above. The most problematic of the limitations is scalability. In order for the insurance industry to utilize blockchain technology, it would take a remarkable amount of infrastructure.9 Currently, blockchain technology is limited by the amount of computing power available. In order for data to be decentralized, each node must be able to process the requisite data for each transaction for a growing number of participants. While smaller blockchains are currently successful with a limited number of participants, the insurance industry has a much larger population of participants that will need to have their data validated in a timely manner. This will mean not only more storage space, but also enough computing power to quickly be able to validate each new transaction or data point.