26. Nature of Risks (3)

Question 1

Aim of insurer and the actuary

Answer 1

• aim of insurer to maximise profit and return on capital
• actuary will support this aim in context of:
• insurer risk profile
• resources available to insurer
• need for insurer to avoid insolvency
• applicable legislation

Question 2

Aims of the actuary

Answer 2

• allow, promote, aims of insurer - ensuring the insurer has resources available to meet risks involved
• actuary will keep in mind interests of key stakeholders, particularly policyholders, should lead the insurer to develop ethically acceptable solutions to its problems

Question 3

Problems confronting the actuary relating to these aims

Answer 3

• policy data
• product design
• marketability
• pricing
• return on capital
• profitability
• supervisory reserves and SCR
• investment
• capital and risk management
• claims (management)