Reinsurance Design
Our personal, yet technically sophisticated, approach comes to the fore in advising
our clients on their reinsurance arrangements. We have spent many years developing “optimisation”
tools that support the identification of the best reinsurance programme for an insurer.
Our process is built upon our understanding of the risk profile and risk preferences of our clients,
from which we are able to understand the relative balance between capital provision and the use of
reinsurance. We are able to capture an insurer's risk preference through Aversion Functions that
quantify their relative risk preferences, to support the analysis of the effectiveness of different
reinsurance programmes.
We are then able to use Genetic Algorithms to develop and assess
different reinsurance programme structures, and then identify the optimal (and most robust) options
to choose. These assessments are based upon stochastic analysis that look across the range of potential
outcomes, to determine the efficiency and effectiveness of a diverse range of options that would not be
considered using a more traditional approach.
