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... strictly a technician. However, actuaries should be viewed as management cons...SUALTY ACTUARY REQUIRE? Although actuaries add value in many ways, the reason most people bring actuaries into a project is to take advant...

... : Last name: Email: Are you sure you want to deactivate your CompleteMarkets Company Profile Deactivate Cancel Loading.. About Us Services Jobs PR Newsletters Employees Articles Blog Photos Group Connections Reviews IMMS Library Immerse yourself in our stacks. Take some time and browse through our library. We have thousands of articles, checklists, tip sheets, sales letters, and more! Communications Marketing Customer Service Planning Finance/Accounting Risk Management Human Resources Selling Legal and E&O Technology Life/Financial Services Glossaries Management Resources & Links Categories Popular Recent All Back How Do Companies Set Their Rates?4/30/2013 12:00:00 AM by CompleteMarkets Editor , Chris Burand This content has not been rated yet. The market determines the price of gasoline, toys, and cars. The market, not actuaries, determines the price of insurance, too. Chris Burand examines whether insurance shouldn't be treated any differently than other products whose prices are based on the market. "Do insurance rates have an actuarial basis?" An insurance client might respond, "They damn well better!" A company person might think, "Of course they do. That's why we pay actuaries." And, depending on their point of view, one actuary might say, "Absolutely! Actuarially based rates are the solid foundation on which the entire insurance industry is built!," while another might respond, "Nope. Not even close." On a macro level, consider this: Commercial Lines rates have jumped by 30% to 200% during the past two years (depending on the line ...

...of loss development factor data: actuaries, brokers, insurance companies, and ...

... of articles, checklists, tip sheets, sales letters, and more! Communications Marketing Customer Service Planning Finance/Accounting Risk Management Human Resources Selling Legal and E&O Technology Life/Financial Services Glossaries Management Resources & Links Categories Popular Recent All Back Loss Portfolio Transfer 4/30/2013 10:45:23 PM by CompleteMarkets Editor , Al Rhodes This content has not been rated yet. LOSS PORTFOLIO TRANSFER by Al Rhodes A loss portfolio transfer (LPT) is one of the few transfers that can be a winning deal for buyer and seller. An LPT allows you to transfer claims to another party for a fixed sum. An LPT program involves past claims, but not future claims, as with a traditional insurance program. The main steps in an LPT are the claims review; actuarial analysis; and accounting for the transferred portfolio. The transaction involves the portfolio value of the liabilities, which is discounted to net present value; the investment value of risk capital; and issues such as administration, accounting, and taxes. SELLER'S ADVANTAGES: Eliminating uncertainty over the cost of losses, pay-out patterns, and interest-rate risks, including unreported losses. Reducing administrative duties. Eliminating accumulated collateral. Freeing up escrow funds used for claims handling from the TPA or the carrier. Seeing a positive effect on the balance sheet. Getting an accelerated tax benefit. SELLER'S DISADVANTAGES: Immediately paying the claim reserves' net-present value may reduce cash flow and investment opportunities if the value of cash increases. Losses may be lower than anticipated. The loss pay-out may be longer than anticipated. The seller may ...

... x No Thanks Loading.. Loss Portfolio Transfer 4/30/2013 by CompleteMarkets Editor , Al Rhodes This content has not been rated yet. LOSS PORTFOLIO TRANSFER by Al Rhodes A loss portfolio transfer (LPT) is one of the few transfers that can be a winning deal for buyer and seller. An LPT allows you to transfer claims to another party for a fixed sum. An LPT program involves past claims, but not future claims, as with a traditional insurance program. The main steps in an LPT are the claims review; actuarial analysis; and accounting for the transferred portfolio. The transaction involves the portfolio value of the liabilities, which is discounted to net present value; the investment value of risk capital; and issues such as administration, accounting, and taxes. SELLER'S ADVANTAGES: Eliminating uncertainty over the cost of losses, pay-out patterns, and interest-rate risks, including unreported losses. Reducing administrative duties. Eliminating accumulated collateral. Freeing up escrow funds used for claims handling from the TPA or the carrier. Seeing a positive effect on the balance sheet. Getting an accelerated tax benefit. SELLER'S DISADVANTAGES: Immediately paying the claim reserves' net-present value may reduce cash flow and investment opportunities if the value of cash increases. Losses may be lower than anticipated. The loss pay-out may be longer than anticipated. The seller may lose control of claims handling. The seller has to pay a fee for transferring the risk and administration. Losses might not be properly accrued or accounted for on current books. BUYER'S ADVANTAGES: The buyer gets a fee and may be able to manage ...

... workers compensation Articles tagged with workers compensation Back 19 Tips For Getting Risk Submissions Accepted This content has not been rated yet. CompleteMarkets Editor 4/30/2013 10:40:32 PM 19 TIPS FOR GETTING RISK SUBMISSIONS ACCEPTED We subscribe to the win-win' theory of negotiating when placing business with our company underwriters. The placement has to be. All Articles by CompleteMarkets Editor Comments (0 ) A Judge's Perspective The Workers Compensation Fraud Problem This content has not been rated yet. CompleteMarkets Editor , Susan Clark 4/30/2013 12:00:00 AM FRAUDBUSTERS: A JUDGE'S PERSPECTIVE ON THE WORKERS COMPENSATION FRAUD PROBLEM by Susan Clarke Stories of people who claim a work injury after they hurt themselves at home are common. But .. All Articles by CompleteMarkets Editor Comments (0 ) Actuarial Checklist For The Insurance And Risk Management Professional This content has not been rated yet. CompleteMarkets Editor , Al Rhodes 4/30/2013 10:45:23 PM ACTUARIAL CHECKLIST FOR THE INSURANCE AND RISK MANAGEMENT PROFESSIONAL by Al Rhodes The responsibilities of risk managers, risk management consultants, accountants, and brokers increase as insurance.. All Articles by CompleteMarkets Editor Comments (0 ) Agency Financial Planning: Today And Tomorrow This content has not been rated yet. CompleteMarkets Editor , Carol Hammes 4/30/2013 10:35:26 PM AGENCY FINANCIAL PLANNING: TODAY AND TOMORROW by Carol Hammes There can be little doubt that changes are in the wind in the Commercial Property/Casualty marketplace. Some industry observers have.. All Articles by CompleteMarkets Editor Comments (0 ) Agency/Broker Profile ...

... experience, rating companies don't adequately consider the operational issues needed to predict future stability. Although adequate capital is important, no company can maintain adequate capital if it's operating results are continually poor. Even though operational and claims paying issues go hand-in-hand, an insurer's balance sheet often lags six to 24 months after its operations are recognizably poor. Then, there's often an additional lag time before the rating companies look at the balance sheet and issue a downgrade. This delay causes many agencies to do business with companies possessing poor operating financials. However, agents who don't understand ratings don't worry as long as the company has a high A.M. Best rating. I've analyzed the stability of many carriers for my independent insurance agency clients. Even without re-examining reserving, leverage, and the like — I'm not an actuary, so I have to take the rating companies' word on these issues — I've found that operating results are critical and often an excellent predictor of an insurance company's future stability. By examining operational issues, I identified problems with MRM (Legion), Reliance (insolvent), and HIH (insolvent), among others, before any of these companies were downgraded. In an ideal world, rating companies would provide separate ratings for insurers' financial stability and their claims paying ability. Because rating any company accurately is difficult — especially insurers — it's all too easy for agents to make mistakes when they extrapolate and apply a single letter grade to every carrier in our highly complex industry. However, because rating companies will probably never provide two ratings, agents must realize that ratings only apply ...

... XYZ's claims are more complex, taking five to seven years to close, allowing the captive to earn more investment income. In contrast, ABC's losses pay out in less than three years, with many closing in the first year. INCOME TAXES Group captive members can deduct their premiums from their federal income taxes. In a group captive, the risk is shifted from the member to the captive. If the captive pays federal income taxes annually, there's no additional taxation on dividends. A captive is just as susceptible to an IRS challenge as any other loss-sensitive insurance plan. CONCLUSION Captives will continue to flourish regardless of the market cycle because they keep costs down. They also provide effective loss control, claims management, and risk management. Al Rhodes, ACAS, MAAA, is president of SIGMA Actuarial Consulting Group, Nashville, TN. He can be reached at (615) 352-3944 or e-mail [email protected] Login or Register (for FREE) to gain access to thousands of other great articles. Need more reasons to join? Need insurance for you, your business or your family? Get quality appointments - Save yourself a whole lot of time & money when you use our directory of carriers, wholesalers and service providers. Negotiate lucrative contracts with carriers and wholesalers. Net result. More revenue for your agency! Clients & Prospects will research you, your co-workers and your agency here. The most comprehensive online insurance industry reference library for - Personal Lines Professionals Commercial Lines Professionals Life/Health & Benefits Professionals Online newsletters and content that you can use for your clients and social media ...

... other folks get what they wanted. Man, was he ever right." Mike took a short breath and continued his monologue. "I had a new client give me $800,000 last week. His existing agent had started to take him and the soft market for granted. He thought a savings of 8% on the expiring premium would guarantee renewal. The problem was the discount was on the wrong coverage and priced against the wrong codes. He had been taking the account, the customer and the relationship for granted. "If somebody gives me a check for $800,000, I take it personally. I'll fight for that guy or gal. My job is to solve the client's problems, not those of the insurance carriers. The insurance companies have underwriters, actuaries, and lawyers on staff they don't need me. The client is my responsibility." Mike had discovered the obvious: His future and the future of his agency were simply to be defined and driven by clients rather than by carriers and producers, as with too many "successful" agencies today. For the next few minutes, we "debriefed" his conversion and more importantly that of his agency team. Mike and his consultant had stripped the operation bare in search of reality. The agency in recent years had become over-managed and under-led. In essence, agencies are the aggregation of products, processes, people, and passion. Products and process require management. People especially the best talent demand leadership. Passion is energy that ensures the best result from the talent assembled. Passion is ...

... success. Agencies ar.. All Articles by CompleteMarkets Editor Comments (0 ) Agent's Checklist: Protecting Your Accounts Against Piracy 1 Verified Reviews - 5 of 5.0 1 2 3 4 5 CompleteMarkets Editor , David Daar 4/30/2013 12:00:00 AM AGENT'S CHECKLIST: PROTECTING YOUR ACCOUNTS AGAINST PIRACY by David Daar Before your accounts get raided, you should consider doing some advance planning. There should be a strategy in place.. All Articles by CompleteMarkets Editor Comments (0 ) How Do Companies Set Their Rates? This content has not been rated yet. CompleteMarkets Editor , Chris Burand 4/30/2013 12:00:00 AM HOW DO COMPANIES SET THEIR RATES? by Chris Burand The market determines the price of gasoline, toys, and cars. The market, not actuaries, determines the price of insurance, too. Chris B.. All Articles by CompleteMarkets Editor Comments (0 ) Make Agency Meetings Productive This content has not been rated yet. CompleteMarkets Editor , Jack Fries 4/30/2013 12:00:00 AM MAKE AGENCY MEETINGS PRODUCTIVE by Jack Fries Have you ever been in a meeting where you didnt know what they were talking about and each minute seemed like an hour? Many.. All Articles by CompleteMarkets Editor Comments (0 ) Poor Company Service: The Antidote This content has not been rated yet. CompleteMarkets Editor , Chris Burand 4/30/2013 12:00:00 AM POOR COMPANY SERVICE: THE ANTIDOTE by Chris Burand Get your companies to listen to you for your mutual benefit. Recent research has revealed that all company ...