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Guide to ERM: Interdependence of Risks
One of the reasons that so few people predicted anything like the financial crisis of 2007-2008 was the common wisdom that housing markets in different parts of the U.S. moved independently of one...
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Guide to ERM: Risk Governance
What should a board expect from management regarding risk and resiliency? As a part of strong enterprise risk management practice the board of directors should consider the following: Establish an...
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Guide to ERM: Risk Management Culture
The culture of a business can be easily observed in the statements and policies of top management and in the behaviors of management and employees. But to truly understand the culture of a business you...
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Guide to ERM: Change Risk
The main processes for enterprise risk management in an insurer involve two levels of control cycles: The first level looks at the individual risks and sets out limits, controls and mitigation...
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Guide to ERM: Risk Management Disclosures
U.S. insurers have made the case to the insurance regulators at the National Association of Insurance Commissioners (NAIC) who have been drafting the U.S. Own Risk and Solvency Assessment (ORSA)...
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Guide to ERM: Economic Capital Model Validation
Fundamentally, an economic capital model seeks to consistently use exposure information and limited actual experience to estimate the impact of remote events that may or may not have ever happened in...
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Guide to ERM: Writing an ORSA Report
Insurance regulators have made the Own Risk and Solvency Assessment (ORSA) into one of the global Insurance Core Principles that need to be adopted in all countries. Several countries have already...
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Adapting to Climate Change: Insurers as Bellwether
Insurance touches and is touched by much of human activity around the globe. So it should not be a surprise that insurers can be expected to be a bellwether for the economic impact of climate change....
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Is Risk Changing or is it All in our Heads?
Accurately identifying and prioritising risk is crucial for business success and, more specifically, to help risk managers decide on investment priorities. Establishing a rational, dispassionate view...
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The Difference Between Risk and Loss
Risk management has caused many people to substitute one four-letter word for another. They will use the word RISK when they should be saying LOSS. And there is a world of difference between the two....
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What Effect are New Regulatory Requirements Having on Risk and Insurance...
While I have been a broker for eight years, the 20-plus years I spent as a risk manager at a financial institution still dominate my outlook on issues. I will no longer fight it—resistance is futile!...
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Using a Financial Impact Analysis to Define Risk Tolerance
Many of the world’s leading corporations do not have an explicit and agreed definition of their risk tolerance or appetite. We facilitate and guide many clients in this area. An important tool for us...
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ERM in Practice: Risk Organization
Discussions of enterprise risk management (ERM) practices often seem almost totally theoretical. But in fact, those practices are very real for many companies. One of the most important aspects of an...
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ERM in Practice: Risk Measurement
In our second installment of the ‘ERM in Practice’ series, we look specifically into the 2013 Annual Reports of eight global insurance companies (five European and three Non-European) and four...
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ERM in Practice: Risk Identification
Insurers recognize the importance of identifying and classifying their important risks as a major organizing idea for their ERM processes. For our ERM in practice series, we’ve looked to the 2013...
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ERM in Practice: Risk Limits and Controls
One of the core elements of a thorough ERM strategy involves setting risk limits and controls. This practice forms an essential link in every organization’s risk management cycle, which includes...
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How to Communicate With Your CEO About Risk
What’s the job of a CEO? When you come down to it, a CEO’s job is to make decisions. The right decisions. Knowing your CEO’s priorities is key to communicating effectively. Your work provides valuable...
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Top 10 of 2014 – #10: Guide to ERM: Stress Testing
Generally speaking, a stress test is an assessment of the financial impact of changing a specific variable, without regard to the likelihood of this change.
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Top 10 of 2014 – #4: Guide to ERM: Risk Appetite and Tolerance
Insurers are increasingly being asked to explain their approach to risk management and as a part of that discussion to clarify their risk appetite. Rating agencies are all asking about risk appetite....
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Top 10 of 2014 – #3: Guide to ERM: Risk Identification
There are a number of common threads linking the emerging regulatory guidelines; one of these is the fundamental importance of risk identification.
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