Central Bank of Ireland - Prudential regulatory agenda for 2013

A pretty meaty speech was delivered last week by the CBoI's head of life insurance supervision, covering the prudential regulatory agenda in Ireland for 2013 and beyond. In essence it is a rather sobering take on the flipside of the Celtic Tiger's death and its impact on what was an effervescent, if still fledgling, cross-border insurance industry, noting that new business volumes recorded in Ireland have declined for the 5th year in a row, and currently aggregate out at a break-even APE/PVNBP margin.

I found there was actually a lot to take from this on the ORSA front, and would recommend any readers on the Emerald Isle pick the bones out of it, in particular that the regulator "expects to see";

• Strategies reflecting "current market realities" - highlighting excessive commission to brokers, swollen lapse/surrender rates and reduced margins from over-competition.
• Tight management of costs
• Increased efforts put in place to retain existing in-force business
• "Credible business plans"
• Viable alternatives to grow business through distribution or product range changes (online facilities highlighted specifically)

While much of this may read as common sense, one can reasonably assume that the CBoI is not seeing enough evidence of this in the Financial Condition Reports and strategic plans that currently cross their desks, and are expecting a much meatier ORSA-type approach to managing strategic risks over the business planning period in the immediate future.

Society of Actuaries in Ireland - Land grab for the Solvency II grey areas?

Having already blogged on the brewing discomfort of the Institute of Risk Management regarding the perceived preference of the FSA for Actuaries to run Risk functions under Solvency II (and had to follow up as the story developed), I was very interested to read through the Irish Society of Actuaries strategic plan released today.

There is definitely the beginnings of a land grab here, with a number of statements eagle-eying the juicy cuts of what is currently ascribed to the Risk function as per the extracts below;

“We also aim to have our members recognised as being committed to the highest standards

of skill and professionalism and well equipped to take up both actuarial and risk management

roles under Solvency II.”

"enhance the standing and role of actuaries within insurance and reinsurance

companies, and in particular, to enhance the standing of actuaries as risk managers"

"Promote the qualifications and relevant experience of actuaries as risk managers."

"Increase awareness of the CERA (Chartered Enterprise Risk Actuary) qualification."

"Another area that is becoming increasingly important for actuaries is risk management,

including the management of risks beyond financial risks. We have already delivered a

number of CPD events aimed at improving members’ knowledge and understanding of risk

management concepts and skills and this will remain an important area of focus."

And perhaps the most land-grabby target;

"Explore the feasibility of partnering with an appropriate university or similar body to

develop a comprehensive risk management training programme for actuaries who want

to skill up quickly in this area."

It's a good job I'm all about openness and competition, otherwise I might start to get an inferiority complex!