Just what are ancillary own funds?

Reading the Financial Soundness Standards for Insurers (FSIs) is an exercise that can only end in madness. I’m sufficiently familiar with them now that I mostly refer back to them for particularly tricky or thorny issues. Without fail, the words fail to clearly communicate exactly what was intended. Take ancillary capital as an example. To […]

Slides from micro insurance sessional meeting in 2018

I had several requests for these slides. At some point they should also be available on ASSA’s website, but that process seems to take a curiously long time. Here are the Micro insurance sessional 2018 slides for anyone interested, provided of course without warranty or guarantee at all and with the understanding that the views expressed are […]

Why isn’t there more micro insurance in South Africa

After a recent Actuarial Society sessional presentation I gave on micro insurance and the regulatory developments, I was asked why there aren’t more micro insurers operating in South Africa. Here is a slightly paraphrased version of the full question: The larger insurance players seem reluctant to enter the market. Why do you think this market […]

Downwards counterfactual analysis

Stress and scenario testing are important risk assessment tools.  They also provide useful ways to prepare in advance for adverse scenarios so that management doesn’t have to create everything from first principles when something similar occurs. But trying to imagine scenarios, particularly very severe scenarios, isn’t straightforward. We don’t have many examples of very extreme […]

Credit Life regulations and reactions (2)

In part 1 I discussed the implications of basing premiums on initial balance or declining balance for profitability and the threat of substitute policies. In this post I want to discuss substitute policies again, talk about cover for self-employed persons and definitions of waiting periods. What is a substitute policy Substitute policies are one of […]