Insurers increasingly feel the need to consider their strategic policy, risks, objectives and constraints in an integral fashion. This is primarily the result of recent developments in the field of reporting and supervision (e.g., IFRS and Solvency II). But growing competition between insurers and the rapidly changing economic circumstances also make it necessary to adopt a wide-ranging and comprehensive policy.
ALM for Life insurance companies
With the above-mentioned goals in mind, ORTEC has developed an Asset Liability Scenario model which is tailor-made for life insurers (ALS Life). ALS Life provides the basis for the professional advice of our own ALM consultants. We also offer this ALM software through user licenses to insurers. With this advanced model, you are able to answer, amongst others, the following questions:
- What is our optimal investment- and interest rate policy?
- What is the impact of various reporting systems on our balance sheet and profit- and loss account?
- What kind of influence does the size and nature of new production have on our policy?
- What are the consequences of the upcoming Solvency II guidelines?
A growing number of insurers utilizes ALS Life not only for ALM analyses, but also for special purpose calculations, for example related to Risk-Based Capital (RBC), Market-Consistent Embedded Value and Solvency II. Furthermore, in the areas of accounting and product development there is currently a great emphasis on the market valuation of liabilities. Such market-consistent valuations can also be carried out successfully with ALS Life.
ALM for Non-Life insurance companies
The Asset Liability Scenario model that is tailor-made for non-life insurance companies is called ALS Non-Life. ALS Non-Life is developed for Property & Casualty and Disability insurance companies. Identical to Life insurance companies, non-life insurers look for answers to questions concerning optimal investment policies, impact of reporting systems on the balance sheets and profit-and loss accounts, and the consequences of Solvency II.
Additional to these analyses, Non-Life insurers focus on the integral impact of the reinsurance policy and the investment policy on important risk-return measures.