To IAA member organizations

The Insurance Regulation Committee of the International Actuarial Association (the “IAA”) is pleased to inform you about a new freely available online publication called the Risk Book. The Risk Book provides a set of high quality reference materials for use in managing the uncertainty of insurer risks. The IAA’s aim in developing these materials is to help ensure both the sustainability of insurance programs and the protection of policyholders. For

  • An actuarial professional organization, the Risk Book may be an excellent source of educational material to meet its primary education mandate as well as continuing professional development.
  • A regulator, the Risk Book may be an excellent source of educational material to be used internally as well as shared with the financial institutions it regulates.
  • An industry association, the Risk Book may be an excellent source of educational material to be shared with its members.
  • An insurer or other financial institution, the Risk Book may be an excellent source of educational and reference material to be shared with its senior management team as well as its Board of Directors and Audit and Risk Committees.
  • An academic institution, the Risk Book provides a convenient resource for teaching materials for instructors, or learning aids for students.

The IAA welcomes the opportunity to communicate with you further about the Risk Book and its uses within your organization. While we are available for potential opportunities   to facilitate presentations of Risk Book topics of your choosing at seminars, webinars or other meeting venues, we also encourage feedback on improvements to the current content and selection of topics.

The IAA and the Risk Book

Historically, actuaries have played many important roles for providers of insurance (e.g., pricing, product design, valuation, and risk and capital management). In addition, actuaries have provided a unique and central interface between supervisors and the providers of insurance coverage to ensure both the sustainability of insurance programs and the protection of policyholders. As a result, the actuarial profession has contributed significantly to the development of risk management tools and processes, both within and outside the insurance industry. Actuarial practice continues to improve the understanding, measurement and communication of risk and its implications through the development of tools (and increasingly processes) to manage the uncertainty of risk in a sustainable and transparent fashion. These tools and processes aim to trace, manage and mitigate the acceptance and transmission of the uncertainty of risk, perhaps serving in a similar aspirational capacity to the way that accounting 

debits and credits trace the acceptance and transmission of cash. This allows industry stakeholders, including actuaries, supervisors and management, to clarify risk exposures, recognize their sensitivities and provide sustainable, ongoing, management oversight.

The Risk Book provides a description of the tools and processes available to supervisors, insurers, and actuaries to estimate and effectively manage pooled risks in a sustainable manner. The IAA hopes that these tools will be applied beyond their historically successful micro-applications (focused on the sustainability of individual insurance organizations) to also be of significant value to the macro issues involving the intersection of insurance, banking, and other financial services.

Scope of the Risk Book

It is not the IAA’s intent to create a “one and done” Risk Book, but rather to build something like a dynamic Wikipedia summary of risk topics of current interest. The IAA hopes that this will spawn additional research into these topics, as well as relevant spin-off topics. Each chapter of the Risk Book covers the central issues of its topic and includes references to additional information, where available. The IAA intends to update and maintain the chapters and their interrelationships on an ongoing basis on its website. The Risk Book is available to the worldwide actuarial profession and all those concerned with the sustainable governance (via identification, management and communication) of insurance operations.

Current chapters of the Risk Book include:

  1. Introduction to IAA Risk Book 
  2. Actuarial Function 
  3. Professional Standards 
  4. Operational Risk
  5. Catastrophe Risk 
  6. Non-proportional Reinsurance 
  7. Intra-Group Reinsurance 
  8. Addressing the Consequences of Insurance Groups
  9. Distribution Risk
  10. ORSA
  11. Resolution of Insolvencies 
  12. Capital – a Regulatory Management Tool
  13. Asset Liability Management 
  14. Financial Statements 
  15. Governance of Models 
  16. Materiality and Proportionality
  17. Risk and Uncertainty 
  18. Policyholder Behaviour and Management Actions 
  19. Dynamic Hedging (due early 2018)
  20. Stress Testing (due early 2018)

Biographical information about the authors of the papers is included in each chapter of the risk book, including experience from around the world in areas such as insurance supervision, enterprise risk management catastrophe modeling, capital management, investment management, reinsurance and financial reporting,  The authors are:  David Sandberg, Stuart Wason, Godfrey Perrott, Peter Boller, Caroline Grégoire, Toshihiro Kawano, Karen Clark, Vijay Manghnani, Hsiu-Mei Chang, Michael Eves, Alexander Fritsch, Eberhard Müller, Alan Joynes, Ralph Blanchard, Sam Gutterman, Maryellen Coggins, Nick Dexter, Malcolm Kemp, John Oost, Charles Gilbert, Tom Herget, Francis de Regnaucourt, Trevor Howes, Sheldon Selby, David Sherwood and Jari Niittuinperä.

Each paper includes an email address ([email protected]) to allow readers to easily submit comments to the author, or to report problems with the website. 

The Insurance Regulation Committee is eager to receive your feedback on current and possible new topics.  Also, we are ready to facilitate speakers at your meetings on these topics.

About the IAA and the Insurance Regulation Committee

The IAA represents the international actuarial profession. Our seventy Full Member actuarial associations represent more than 95% of all actuaries practicing around the world. The IAA promotes high standards of actuarial professionalism across the globe and serves as the voice of the actuarial profession when dealing with other international bodies on matters falling within or likely to have an impact upon the areas of expertise of actuaries.

The objectives of the IAA’s Insurance Regulation Committee are:

  • to promote the role of actuaries in the regulation and supervision of insurers so that the public interest is served;
  • to support the creation of international principles and frameworks for regulation and supervision of insurers in order to have actuarial principles realized where appropriate; and
  • to maintain and to strengthen the relationships with key international organizations dealing with the regulation and supervision of the insurance and reinsurance industry.


Members of the Risk Book Task Force
of the Insurance Regulation Committee

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