Compliance Digest™’s Post

Our Senior Consulting Actuary, Nicholas Frongillo, ASA, has been featured alongside nine other talented prospects in the captive space to keep an eye on in the future, according to Captive Review. Check out the complete list below. https://lnkd.in/ec-ykJTJ #CaptiveInsurance #CaptiveReview #RiskManagement #Actuarial #Actuary #Insurance

Is analyzing the insurance industry complicated and time-consuming??🕵️♀️💼 🔍 If you have the above question then let me take you through the critical analysis and understanding of what to consider and see while making investment decisions in insurance sector. Some key points to help you make an informed investment decision: ➡️ Economies of Scale: - Large insurers operate at an average efficiency level of 90%, while medium and small insurers range from 80-88%. - Consolidations in the industry can lead to potential cost reductions and increased efficiency. ➡️ Investment Income: - Investment activities of insurance companies are similar to other financial institutions. - Investment income plays a significant role in insurers' overall income. ➡️ Valuation Metrics: - Primary metrics for valuing insurance companies include Price to Book (P/B) and Return on Equity (ROE). - ROE of around 10% suggests the firm is generating a healthy return for shareholders. ➡️ Combined Ratio: - The Combined Ratio measures incurred losses and expenses as a percentage of earned premiums. - A ratio above 100% indicates losses, while below 100% signifies an operating profit. ➡️ Premium Growth Potential: - Evaluate the potential for premium growth, introduction of new products, and projected combined ratio. - Consider the expected payout of future reserves and associated investment income. ➡️ Regulation: - The insurance industry is highly regulated, offering investor protection but creating compliance barriers. ➡️ Risk Management: - Insurance companies evaluate risks, draft policies, and compensate policyholders for covered losses. ➡️ Investment Portfolio: - Insurance companies generate income by investing premiums received. - Fluctuations in interest rates or poor investment performance can impact the industry. ➡️ Technological Advancements: - The insurance sector is adapting to new risks and changes in how insurance is calculated, purchased, issued, and paid out. Dont forget to follow Kinesh Shah for more such analysis and insightful content 😌 Share your thoughts on analyzing the insurance industry in the comments below. 💬 #linkedinconnections #linkedinforcreators #linkedinforlinkedin #insurance #investments #viral #trending #insurancesector #growth #sectoranalysis #linkedincommunity

While this survey focused on insurance companies, the issues and approached discussed on bonus plan operation can apply to companies in all industries. Particularly companies that have objective of using the bonus program to reward individual high performers but struggle to make that happen. https://lnkd.in/ewddNiAY

🏬 XYZ insurance company handling life insurance - How to manage policie's vast array of contracts? 📑 IFRS17/INDAS 117 - guides that at the start, group these policies into a portfolio based on similar risks. #LevelofAggregation! 📝 Key Insights: 🔹 Portfolio Identification: Group contracts with similar risks (think annuities, term insurance, endowment assurance) to streamline management. 🔹 Strategic Division: Each portfolio is broken down into: 🔖 Policies with high initial premiums and low payout risk are categorized as Low-Risk Contracts. 🎯 Policies with higher chances of claims are classified as Onerous Contracts. 🌐 Other policies fall into the Remaining Contracts group. 🔹 Annual Cohorts: No mixing contracts issued more than a year apart, ensuring precise annual disaggregation. 📊 Why It Matters: This method ensures that insurance companies can accurately measure, recognize, and disclose contract details, leading to better risk management and financial reporting. CA.(Dr.) Alok Garg #IFRS17 #IASB #Insurance #ContractManagement #RiskManagement 

Great insights from James Isden, Huw Evans, Richard Care and Danny Hurley on life insurers' year-end 2023 financial results. Some key themes from Solvency II and other public disclosures: 📯 While disclosures at Year-End 2022 reflected the impact of volatile economic environment, the most recent disclosures at Year-End 2023 demonstrate a shift towards organic growth for capital generation 🎷 Many firms have benefited from the reduction in Risk Margin as part of Solvency UK reform, although regulatory change was not explicitly emphasised as a driver of the headline message 🎻  Almost all of the firms acknowledged further changes to SII regulation, including to remove the matching adjustment cap on sub-investment grade assets and to apply the fundamental spread by notched credit rating - but several insurers have noted that this wasn't expected to drive material change 🎵 Favourable interest rate environment is particularly benefitting the bulk annuity market. The favourable backdrop is allowing for generation of surplus and cash 🔔 We've also seen some acknowledgement of the PRA's concerns on funded reinsurance, with adjustments to collateral approach

Exploring the impact of private equity stakes in life insurers. Interesting read shedding light on critical reports. #Insurance #PrivateEquity #FinanceInsights #IAINS #InterAmericanInstituteofInsurance https://lnkd.in/euJwvrCv

A McKinsey report on private capital and the insurance industry highlights the increasingly symbiotic relationship between the two industries.   As McKinsey reports, private capital firms have injected more than $31 billion of net new private capital into the life and annuities industry worldwide since 2014, allowing insurers to sell their legacy books (or reinsure them) to improve their ROE and free up capital, access distinctive investment management capabilities and support their business growth.   At the center is a strong partnership between an insurance company and its private capital partner.   At Aquarian, we’ve been invested in insurance from the start and are in it for the long term. The comprehensive investment solutions we provide to millions of Americans drive our decision-making at every level. https://lnkd.in/e5SacqAH

📈 Leveraging Private Placement Life Insurance (PPLI) for Tax Strategy 💼 For HNW clients seeking sophisticated tax planning strategies, Private Placement Life Insurance (PPLI) can be a powerful tool. But this complex product requires a deep understanding of its role in a client’s portfolio. 🧠🔍 PPLI allows accredited investors to enjoy life insurance benefits while reducing income and capital gains taxes. With customized investment options and tax-efficient growth, it’s a creative solution for the right clients. However, it’s critical for advisors to weigh the fees, regulations, and the product’s fit within the client’s broader goals. 💡 Key takeaway: Advisors must be well-versed in the complexities of PPLI to effectively position it within a client’s financial plan. It’s not just about insurance—it’s about strategic tax planning. ⚖️ #PrivateWealth #TaxStrategy #HNW #EstatePlanning #WealthManagement #PPLI #Advisors #FinancialPlanning #TaxEfficiency #LifeInsurance #Investing #HighNetWorth #UHNW

Private Placement Life Insurance is a powerful financial planning tool for high met worth families.

# Only put off until tomorrow what you are willing to die having left undone ## Seize the Opportunity: Invest in CNO Financial Group, Inc. \(CNO\) In today's volatile market, missing out on potential opportunities can be a major concern for investors. CNO Financial Group, Inc. \(CNO\) is an insurance player that has shown remarkable growth in recent months, outpacing both its industry and the S&P 500. With a growing agent force and improving underwriting margins, CNO has seen its shares surge by an impressive 19.6% in just three months. By investing in CNO, you can align your Health Savings Account \(HSA\) with a company that not only offers financial stability but also contributes to the well-being of individuals and families. The company's success in the insurance industry is a testament to its commitment to providing quality healthcare solutions. Don't let the Fear of Missing Out \(FOMO\) hold you back. Take action and consider investing in CNO to grow your HSA. By doing so, you'll not only secure your financial future but also contribute towards improving the health and wellness of your loved ones. #hsa #investing #healthcare #health #family #wellness 💰📈💪