No industry is immune to failure, and over the past few decades, there have been several examples of significant insurance company failure. Long before the financial crisis emerged in 2008, it had been recognized that existing risk management and solvency regulations were inadequate. Solvency II is probably the most ambitious financial services legislation ever implemented. It will completely change the measurement of the financial stability of European insurers.
Solvency II implementation costs may shave a few cents off earnings per share, but this cost should be balanced by the benefit of a far more transparent – consistently transparent – set of reporting requirements than before. This valuable information will lead to improved economic planning and insight, and the ability to embed early-warning mechanisms.
Most insurance companies have mountains of data, but many only track indicators that are easy to obtain, and not necessarily relevant. Stuart Rose says that means too much noise and not enough understanding about how, why or if those metrics support strategic outcomes.
The primary benefit of an improved claims recovery process is the impact to your bottom line, but a truly great secondary benefit is the positive affect on customer satisfaction. Read Stuart Rose’s post about optimizing your claims recovery process.
Insurance fraud has no doubt existed wherever insurance policies are written, taking different forms to suit the economic times. Today the magnitude of insurance fraud is not only startling but increasing. Recent studies by the National Insurance Crime Bureau reported an 18.3 percent rise in questionable claims for the period 2009 to 2011. What are you doing to win the insurance fraud race?
Stuart Rose, Global Insurance Marketing Manager at SAS, takes a look back at 2011 with an inimical term. He uses annus mirabilis – I’ll let you look it up. For SAS, it describes our year to a tee. Does it describe your year as well?
Today, predictive modeling and forecasting are used by actuaries for pricing, but few insurance companies have applied analytics in real-time or near-real-time operational environment. The “analytical insurer” is using analytics throughout its organization to improve business performance and reduce risk.
One way to reduce claims expenses is through claims recovery, unfortunately opportunities for claims recovery are often missed. Find out how you can minimize the number of missed recovery cases so you can increase efficiency and reduce loss expenses.
It will be many years before the Dodd-Frank Act has been deemed a success or just another compliance burden. Read about the role of the Federal Insurance Office and its potential for streamlining rules and regulations for insurers.
They said it would never happen again, but it appears that the Solvency II deadline has been postponed once more. This gives a little breathing room for the whopping 45 percent of insurance companies have not started their Solvency II projects. Does this delay mean that insurers can take a wait-and-see approach?