Twenty Third Floor

Figuring out the future and the now

Category: banking

Actuarial and Risk, alternative investments, banking, complexity, credit risk, currency risk, economics, emerging risk, FinTech, inflation, insurance, InsurTech, legal risk, liquidity risk, managing uncertainty

Inflation, Bitcoin & Financial Risk – Does This Matter for Insurance?

17 March 2025

David Kirk

This is a bit off-topic from my usual discussions on insurance, risk, and capital modelling, but financial and economic risk matters deeply. And for insurers, we’ve seen how things can go very wrong. Hyperinflation, Currency Crises & Insurance Industry Collapse Hyperinflation destroyed Zimbabwe’s insurance sector, and decades later, it still hasn’t recovered. Currency crises in…
Read more: Inflation, Bitcoin & Financial Risk – Does This Matter for Insurance?
Actuarial and Risk, banking, Basel III, capital, capital structure, costofcapital, life insurance, managing uncertainty, Solvency Assessment and Management, Solvency II

The Loss-Absorbing Capacity of Distant Dividends That Can Still Be ‘Foreseen’

24 February 2025

David Kirk

Foreseeable dividends remain a grey area in Solvency II and South Africa’s Solvency Assessment and Management (SAM). While the concept seems straightforward—capital that is likely to be distributed as dividends should not count towards regulatory solvency—its practical application is anything but clear. Regulatory Ambiguity: When Is a Dividend Foreseeable? The official guidance under Solvency II…
Read more: The Loss-Absorbing Capacity of Distant Dividends That Can Still Be ‘Foreseen’
Actuarial and Risk, banking, capital, managing uncertainty, market risk, measurement

Value at Risk – not always a monster, but normally it is.

6 November 2024

David Kirk

Nassim Taleb is not a fan of Value At Risk (VaR) “You’re worse off relying on misleading information than on not having any information at all. If you give a pilot an altimeter that is sometimes defective he will crash the plane. Give him nothing and he will look out the window. Technology is only…
Read more: Value at Risk – not always a monster, but normally it is.
Actuarial and Risk, banking, financial risk, insurance, investments, life insurance, liquidity risk, measurement, systemic risk

Liquidity vs Solvency: Understanding Insurance Company Risks

2 November 2024

David Kirk

In this exploration of liquidity and solvency risks in insurance companies, we’ll examine how these risks interact, often in surprising ways. We’ll challenge common assumptions about insurance company risks and explore how modern insurance practices have evolved traditional risk profiles. Understanding the Basics: Banks vs Insurers The classic banking model of liquidity risk is straightforward:…
Read more: Liquidity vs Solvency: Understanding Insurance Company Risks
banking, currency risk, economics, inflation, insight

Bitcoins, deflation and the slightly silly impact of loss

31 October 2017

David Kirk

I think Bitcoins and the Blockchain are amazingly cool. I still don’t think Bitcoins are a useful currency and I worry that many of Bitcoin’s biggests fans also like the gold standard, Austrian economics and some other crazy stuff. What impact will the loss of Bitcoins over time have on the economy?
Read more: Bitcoins, deflation and the slightly silly impact of loss
Actuarial and Risk, banking, competition, complexity, creating value, credit risk, distribution, economics, insurance, legal risk, life insurance, regulatory risk

Credit Life regulations and reactions (1)

12 October 2017

David Kirk

Credit Life regulations have been live for long enough now that insurers are starting to feel the impact and the shake-up of amongst industry players is starting to emerge. There have been plenty of debate around the regulations, in part because of the dramatic financial and operational impact they will have, and partly because of…
Read more: Credit Life regulations and reactions (1)
banking, book reviews, currency risk, economics, financial risk

Book Review: Bitcon – The Naked Truth About Bitcoin

12 October 2014

David Kirk

Jeffrey Robinson, the author of the well known book “Laundrymen” that I’m now reading, has written an engaging story about The Satoshi Faithful (as he calls them) supporters of Bitcoin and where their Faith is leading them stray. The book is called BitCon: The Naked Truth About Bitcoin and it doesn’t pull punches in deriding the…
Read more: Book Review: Bitcon – The Naked Truth About Bitcoin
banking, currency risk, news

Norway’s new bank notes

11 October 2014

David Kirk

Pretty far from a normal topic for this blog, but at least it relates to money. Norway has new banknotes or at least they will be 2017. Standard on one side and abstract, competition winning pixelated art on the other. Feels appropriately Scandinavian to me.
Read more: Norway’s new bank notes

About David Kirk

Featured Posts

The Complexities of Comparing SCR Cover Ratios Across Insurers
by David Kirk
In the insurance industry, we often use Solvency Capital Requirement (SCR) cover ratios as a key metric for comparing insurers’ financial strength. While these ratios… Read more: The Complexities of Comparing SCR Cover Ratios Across Insurers
One answer could be pet insurance
by David Kirk
I firmly believe major demographics shifts are going to have massive social, political, economic, financial market and commercial impacts in the coming decades. The balance… Read more: One answer could be pet insurance
A piece of the failure puzzle – decreasing insurer failure rates through Skilled Person Reviews
by David Kirk
Every failure hits policyholders’ savings or cover, impact their lives and their livelihoods. They destroys shareholder value and decrease confidence in the entire financial sector.… Read more: A piece of the failure puzzle – decreasing insurer failure rates through Skilled Person Reviews
How and why insurers fail
by David Kirk
I’ve been updating my presentation from 2021 on “How and Why Insurers Fail”. I now estimate the annual failure rate (or at least getting into… Read more: How and why insurers fail
The hidden dangers of opinion shopping and trusting good news.
by David Kirk
I had a recent discussion on the value of getting a second opinion. There’s the old line that “if you want five opinions, ask three… Read more: The hidden dangers of opinion shopping and trusting good news.
40,000
by David Kirk
40,000. That’s the ballpark figure I usually work with as the minimum number of micro insurance policies required for scale. The expenses of running even… Read more: 40,000
IFRS17 may not kill off EV
by David Kirk
Will IFRS17 kill off Embedded Value (EV) reporting in Africa? Or will it finally bring Market Consistent Embedded Value (MCEV) to life? I gave a… Read more: IFRS17 may not kill off EV

Categories