Your article is quite a bit different than the physical description of what this actually is about. Guy Carpenter has developed a methodology, a model, if you please, which will provide the capital marketplace with a tool the “hedge” against inadequate reserves by both insurers and reinsurers. They claim, that their model has been able to assess the unpredicable changes within an insurers exposure and take into consideration the unforeseen liabilities including the emergence of new legal theories.
Apparently this will provide the industry with an additional tool in which to “cheat” on reserving practices, which is nothing new, and most reserve to “expected”. It also would provide the capital marketplace with a so called life line for any number of the exotic risks that they have already underwritten, this despite the fact, that it unlikely that they literally have a clue as to what they have accepted.
Then of course, there is the question as to whether this causes “someone” to be a co-conspirator in managing profit and loss thereby effecting the efficacy of share pricing! My advice, don’t broadcast this to regulators or the SEC.
We have updated our privacy policy to be more clear and meet the new requirements of the GDPR. By continuing to use our site, you accept our revised Privacy Policy.
Your article is quite a bit different than the physical description of what this actually is about. Guy Carpenter has developed a methodology, a model, if you please, which will provide the capital marketplace with a tool the “hedge” against inadequate reserves by both insurers and reinsurers. They claim, that their model has been able to assess the unpredicable changes within an insurers exposure and take into consideration the unforeseen liabilities including the emergence of new legal theories.
Apparently this will provide the industry with an additional tool in which to “cheat” on reserving practices, which is nothing new, and most reserve to “expected”. It also would provide the capital marketplace with a so called life line for any number of the exotic risks that they have already underwritten, this despite the fact, that it unlikely that they literally have a clue as to what they have accepted.
Then of course, there is the question as to whether this causes “someone” to be a co-conspirator in managing profit and loss thereby effecting the efficacy of share pricing! My advice, don’t broadcast this to regulators or the SEC.
Oh no say it’s not so.
Peter Polstein