Major regulatory change. The rise of emerging markets. Ongoing economic uncertainty. Technology-driven turbulence. Increasing consumer expectations.
These challenges offer the key to future profitability for insurers who make the right strategic, investment, organisational and operational changes. They must identify and assess new options for value creation while continuing to manage risks and meet emerging regulatory requirements.
Combining the experience of our dedicated actuarial and risk professionals and close partnerships with related practices across EY, we provide truly integrated services across all disciplines in the insurance industry.
Our deep global knowledge comes from our work with insurance companies, banks, pension funds, private equity firms, sovereign funds and local regulators and enables us to answer key challenges the industry faces.
Our global practice helps organisations around the world successfully meet these challenges. We can help you ask the right questions, set priorities and define the action plans needed to succeed in the fast-shifting insurance landscape.
Together, we help you deliver better outcomes and long-lasting results, from strategy to execution.
How we can help
Our work is grounded in an extensive understanding of the financial dynamics of businesses. Our services have been developed to address the most common client issues that we are asked to solve.
Actuarial Transformation and Offshoring
Insurers are looking to consolidate their actuarial systems as they integrate risk and finance reporting in a cost efficient way.
They are making significant investments to build their Actuarial system and process landscape for the future. These investments include improving standardisation and automation, and using selective offshoring and shared service centres.
We can help companies simplify their actuarial infrastructure and achieve cost efficiency by identifying ways to streamline or offshore/outsource their actuarial and finance reporting processes and then implementing it.
Provision of analytic and modelling solutions, by using our statistical training and practical industry experience analysing large volumes of data (across financial services and increasingly other industries).
We use our analytical competency and business experience to comprehend complex and disparate business issues, data, information, governance issues and complete scenario modelling and analysis to enhance clients' decision-making on business issues. Our analysis and modelling helps to inform:
- Strategic direction and the case for change in terms of financial and non-financial measures
- The design of transformations, including the trade-offs in design and value through the application of the actuarial investment model
- The implementation and monitoring of change through quantifications, indicators and other measures supporting performance / risk management and benefits management
- Business as usual through the application of the control cycle and embedding the appropriate measures in business reporting
Audit and Assurance
Our actuaries provide technical support for the audit of actuarial items recorded on the financial statements of insurance companies.
With the extensive experience in financial reporting gained in their audit work, the Audit and Assurance actuaries are able to provide assistance to non-audit clients as well in the technical and procedural aspects of financial reporting, including the adoption of new standards, the implementation of new systems, and the review of the accuracy and effectiveness of existing actuarial calculations and processes.
Whether driven by regulators, investors, rating agencies or internal stakeholders, the capital requirements of insurers are numerous and complex.
Firms are subject to a number of capital measures, driven by rating agencies and analysts, as well as local and international regulators. We help our clients understand and manage the numerous metrics, as well as working with them to help them form their own views on their capital needs.
Increasingly insurers are expected to run complex in-house models to calculate their capital requirements. We work with our clients to help them build, test and maintain these models as well as supporting them with the communication of the results.
Working alongside our clients, we help them manage their stakeholders, from interpreting and complying with regulatory requirements to providing board-level comfort on the quality of any in-house models.
Cyber Risk Measurement and Insurance
As companies face the uncertain impact from the escalating incidence of cyber-attacks, they look to more effectively measure and manage the financial risks resulting from a potential cyber breach.
With the emergence of standardised breach data, and increasingly more sophisticated risk measurement and management techniques; cyber risk issues are becoming preeminent to corporations and insurance underwriters. Our experienced Cyber Risk team provides integrated services to help companies with underwriting and risk financing strategies.
Significant Financial reporting change is on the way in the form of IFRS 4 Phase 2, IFRS 9 and FAS 60.
It is crucial for companies to understand the micro and macro effects of new reporting requirements, the importance of reported figures, the wider implications for strategy, operations and how to communicate new management targets to shareholders. We help companies understand and prepare efficient external and internal reporting frameworks by providing actuarial services that are part of integrated multidisciplinary approaches.
GI Reserve Review
The provision for outstanding claims liabilities is the most significant item in most general insurance companies’ balance sheets, and movements in the provision from year to year can often form a significant part of the insurer’s profit.
Additionally, the outstanding claims liability estimate is an integral part of the pricing process especially for long tail classes and can be an important component of an insurer’s regulatory and economic capital calculations.
Whether we are providing the primary estimate of the outstanding claims estimate or reviewing the estimate as part of an external peer review engagement or audit, EY applies leading practice processes and methodologies consistently around the world to provide our clients with more accurate and more reliable estimates of their outstanding claims liabilities.
Against the backdrop of rising costs, aging populations, stressed infrastructure, constrained resources and shifting regulations, health insurers must develop new offerings and find new ways to operate.
Across diverse national health care markets, there are unprecedented risks, but also great opportunity – thanks to breakthrough advances in technology and more sophisticated use of data and analytics.
We are working with strategists and practitioners from across our practices – including life sciences, public sector health care, insurance, consumer products, engineering and advanced technology – to re-imagine health care.
In the current low yield and volatile market environment, Insurers and Pension Schemes are seeking to optimise risk adjusted return through more innovative investment, and wealth and asset managers are partnering ever closer with their investors to add value.
EY’s Global Investment Advisory team specialises in working with each of these sectors to drive more value from their investment portfolio by bringing together resources with finance, actuarial, accounting, tax, quantitative, valuation and corporate finance backgrounds.
For many life assurance companies, a key risk is ‘longevity risk’ where for their annuity products the risk is of individuals living longer than expected.
We share knowledge of current trends and market practice to help practitioners assessing longevity risk for audit or assurance purposes or to help in many aspects of longevity risk transfer solutions for advisory clients.
Our Managed services assist clients executing strategies to outsource or co-source recurring labour intensive and/or non-core activities necessary for day-to-day actuarial and/or underwriting operations to EY.
Potential outsourcing and co-sourcing arrangements include, but are not limited to, the following, by major function:
- Product: rate filings, experience studies, administration support
- Financial reporting: performing in-force valuations, reconciliations and controls reporting
- Modelling: model maintenance, performing production runs (forecasts, ALM, CFT)
- Risk management: ongoing model validation and customer analytics
Mergers & Acquisitions
As companies revisit and optimise their portfolios, they look to acquire and consolidate more attractive businesses, and dispose of businesses in markets where they cannot compete.
With depressed valuations in many insurance markets and the shifting strategies of multinationals, the mergers and acquisitions market is poised to become more active. Our experienced Transactions Advisory Services team and our market-leading actuarial transactions skills provide integrated services to help companies with valuations and post-merger integration.
Actuarial modelling is becoming increasingly crucial to business operations in a number of areas, externally for financial reporting liability reserving, solvency and regulatory capital modelling, and internally for risk management, ALM and business planning, pricing, embedded value and non-traditional modelling.
Our model advisory services cover model design and implementation, review and validation, process and governance, efficiency enhancement, as well as production etc. We assist our clients to make their models fit for purpose, effective in their support of finance and risk function requirements and scalable for future development.
Pensions and Pension Fund Advice
Companies, governments and pension fund management (trustees) are continually looking for support with their pension funds in the areas of design, cost management, risk mitigation and best-practice governance.
We provide advice in all of these areas.
We assist our clients by providing market perspective on disruptive technologies, ‘game changing’ innovations and trends in insurance propositions to customers.
Our forward-thinking vision allows us to support our clients in taking advantage of these changes, in terms of analysing the customer opportunities, developing new wave propositions and optimising the pricing.
Risk management remains a prominent theme in global regulatory developments and within firms’ own business enhancements to ensure continued business resilience and efficient allocation of capital.
We assist our clients in designing and implementing proportionate and commercially effective risk management frameworks that support better business decision-making on an ongoing basis. Our solutions include design and implementation of the risk management strategy, appetite and framework, including processes, models and tools for risk identification, measurement, mitigation and monitoring.
Recovery and Resolution Planning
In a drive to improve the resilience of insurers and reduce the impact of failure, boards and regulators are requiring recovery plans, resolution plans and increasingly improved liquidity risk management from insurers in major markets.
We are the leading adviser on these important topics, having supported the majority of global systemically important insurers, multiple internationally active insurance groups, and many large domestic insurers. As insurers consider how best to mobilise and address these issues proportionately, we can offer support to develop the plans and/or test their credibility, conduct resolvability assessments, support with operational continuity and implement improvements, using a suite of tried and tested tools, robust methodologies, and in depth regulatory experience.
A wide variety of drivers are pushing clients to consider significant changes to maximise returns, manage risk, reduce volatility and optimise the asset side of the balance sheet and their asset and liability matching.
We bring cross-practice and international know-how to these issues through a unique proposition that combines finance, risk, actuarial, accounting, tax and M&A skillsets to support clients in emerging with more efficient structures. We also advise clients on analysing their risk adjusted return on capital and in supporting them with their Investor dialogue.
Who we are
We are a diverse team of consultants and industry professionals with a global mindset and a collaborative culture.
We understand your issues and are driven to ask better questions in the pursuit of making our clients' businesses work better.