valuations, capital and risk management

The actuarial valuation of policyholder liabilities is fundamental to the management of a life insurer's business. A life insurer's policyholder liabilities impact on the company's profit release, embedded value, solvency and capital requirements.

Life companies are required to demonstrate minimum levels of solvency and our statutory actuarial capabilities allow us to perform these valuations for a growing number of life insurance clients.

Embedded values are an important management tool for life insurers. As such, one of our core offerings is the calculation of embedded values. The development of market consistent embedded values (MCEVs) has become pertinent in recent years. Quindiem's life team is well-informed and conversant with the latest principles and approaches in calculating MCEVs.

Life companies intending to expand their businesses will need to investigate their current and future capital requirements. The life team is able to assess a life insurer's capital requirements and is also able to extend its capital modelling expertise for the purposes of investigating internal capital targets and regulatory capital requirements. Financial condition reporting (FCR) is strongly related to capital modelling exercises and therefore forms part of our core service offering. In addition, we assist with capital allocation (for example allocation to specific product lines) as well as reinsurance optimisation.

Both principals in the life team have spent a significant part of their careers working for and advising reinsurers. This firsthand knowledge and experience ideally places the life team to optimise reinsurance strategy and to provide in-depth advice to both reinsurers and the reinsured.

The ability to select appropriate retention levels for reinsurance arrangements is strongly correlated to efficient capital management.

Our capital management and modelling expertise is aligned with our ability to provide strategic risk management advice across insurance entities.

We have extensive experience in assisting clients with insurance licence applications, both in South Africa and the rest of Africa.

Even though Solvency II is a European framework, other markets, including South Africa, have adopted some of these principals. Quindiem has therefore developed substantial Solvency II competency. As a result we are well placed to advise our clients on liability valuation, capital measurement and risk management based on past industry experience in Africa and knowledge of the proposed European framework.