Category: AFIR / ERM / RISK - actuview - the international streaming platform for actuaries

The European Actuary No. 43 | Making Sense of Mediation in Insurance

Thu, 28 Aug 2025 15:09:23 +0000

Arnoud Chneiweiss explains the French mediation scheme and advocates for clarity and simplicity in insurance contracts for the benefit of consumers.

Find the full TEA issue here.

ESG Risk – Learnings from the Banks

Thu, 28 Aug 2025 08:22:51 +0000

As global stakeholders intensify their focus on environmental, social, and governance (ESG) performance, financial institutions are emerging as both catalysts and case studies in the ESG transition journey. This webinar, "ESG Risk: Learnings from the Banks", explores how leading banks have navigated the complex shift from ESG intention to execution. Drawing on real-world strategies, governance structures, and disclosure practices, we will unpack key lessons from the sector—ranging from integrating ESG risk into credit assessment and capital allocation to tackling data gaps and aligning with regulatory frameworks like the ISSB and EBA Guidelines. Join us to uncover what the banks have done right, where challenges remain, and what these insights mean for your organization’s ESG roadmap.

Guide to Climate Risk Modelling and Stress Testing

Wed, 13 Aug 2025 14:47:42 +0000

Climate risk modelling and stress testing have become essential tools for insurers in managing climate change's physical, financial and transition risks. But effective climate risk modeling and stress testing is a complex undertaking – and not all vendors' modeling approaches are the same – with different methodologies and formats.In this webinar cohosted by InsuranceERM and Milliman, experts from across the insurance industry discuss the latest developments, best practices, and outlook in this fast-moving space.This webinar was originally published by InsuranceERM, at: https://www.insuranceerm.com/content/webinars/experts-guide-to-climate-risk-modelling-and-stress-testing.html

Index insurance: A shield against emerging risks

Fri, 08 Aug 2025 12:52:03 +0000

In a world facing rising climate disasters and cyberattacks, traditional insurance often fails to protect the most vulnerable due to high costs, long delays, and limited accessibility. In this video, Daniel Nkameni—Actuarial Consultant at Detralytics and PhD candidate at the Polytechnic Institute of Paris—presents index insurance as a smarter solution for emerging risks. Index insurance pays out based on objective indicators like rainfall or temperature, allowing faster, lower-cost compensation. But it also introduces basis risk—a mismatch between the index and actual losses. To address this, Daniel introduces a hybrid insurance model that combines the speed of index insurance with the precision of traditional coverage. Using real agricultural data from Illinois, the model optimizes payouts while accounting for policyholder preferences and claim delays. This hybrid approach offers a practical, scalable path to insure against modern risks—like drought or cybercrime—more effectively. Daniel calls on regulators, insurers, and researchers to collaborate in refining and scaling index-based solutions, ensuring fairer and faster protection in a rapidly changing world.

Innovative ways of tackling AI insurance fraud

Fri, 08 Aug 2025 08:51:49 +0000

In this video, I discuss the importance of acting upon rising fraud in insurance due to AI and some methods that can be implemented to counter the same.

Using AI technologies for climate risk relief

Fri, 08 Aug 2025 07:35:28 +0000

We explore how climate risk is defined by the Task Force on Climate-Risk related disclosures (TFCD) and how climate-related weather events have impacted South Africa. We then further visit some responses to climate-related weather events by stakeholders such as municipalities, weather agencies, the private sector and general insurance companies. We also highlight some of the key changes insurance companies have implemented to manage their risk exposure to climate-related risks through pricing and insurance coverage, product innovation and claims management enhancements. Furthermore, we provide some examples of how insurers have leveraged off artificial intelligence (AI) and technology-enabled methods to improve their resilience to climate-related weather events such as the implementation of machine learning techniques to automate underwriting and pricing procedures which adjust themselves as new data regarding the insured perils becomes available, i.e., generative AI.

From "Will it pay" to "When will it pay"

Fri, 08 Aug 2025 09:41:23 +0000

The Protection Gap & Parametric Solution: Traditional insurance is failing due to rigid claims processes that create disputes and exclude vulnerable groups (e.g., climate victims forced to self-prove losses, health policies requiring extreme conditions for payouts). This structural flaw stems from a disconnect: actuaries design products around loss distributions, while users demand guaranteed coverage upon event occurrence. Parametric Insurance as Revolution: Parametric insurance bridges this gap using pre-set, objective triggers (e.g., wind speed >50m/s). It pays automatically when triggers are met, eliminating loss assessment delays and claim denials. While basis risk exists (imperfect trigger-loss correlation), its advantages are transformative: covering "uninsurables," ensuring transparency, and enabling near-instant payouts. Actuaries as Threshold Architects: My simulated critical illness product demonstrates how actuaries can optimize triggers. Using a cohort of 10,000 insureds across geographic/individual risk dimensions, a threshold of 0.22 regional disease incidence minimized combined error (false negatives/payouts). This proves basis risk is reducible through scientifically calibrated, data-driven guardrails – "removing guesswork, not people, from insurance." The Future of Trust: Parametrics shifts insurance from reactive loss compensation to proactive event-triggered safeguarding. It replaces human conflict with system consensus, anchoring trust in transparent data. With AI enabling adaptive thresholds and Web3 democratizing access, we can fulfill insurance’s original covenant: social solidarity through shared resilience. This isn’t incremental change – it’s reprogramming trust itself.

P is for Parametric

Fri, 08 Aug 2025 09:38:07 +0000

Cities face ever-stronger heatwaves, yet the collective risk remains uninsured; actuaries have the responsibility to provide a solution. I propose a mutual parametric insurance system serving cities in a network. Payouts are delivered automatically when local temperatures exceed customised thresholds - the same approach applies to other climate risks. The structure should be transparent, with premium contribution answering a few basic and fair principles and well defined payment conditions. It is a small actuarial contribution to the gargantuan task of protecting and connecting a world that is increasingly more exposed and fragmented. In this endeavour, we are in the very good company of past actuaries (in spirit if not in name), and we honour our roots while inventing wings.

Climate Change: Actuaries' Key Role

Fri, 08 Aug 2025 09:22:20 +0000

Climate change: It's here, and it's impacting everything – especially our finances. So, how are experts tackling the economic fallout? Meet the actuaries! In this Young Actuaries World Cup video, Bhavya Shah explains how actuaries are using their unique risk management skills to model climate impacts, develop new financial solutions, and help businesses and governments navigate a rapidly changing world. Get ready to see the numbers behind a sustainable future! Like, share, and subscribe if you believe in data-driven solutions for climate change!

AI Failure Insurance

Fri, 08 Aug 2025 08:59:54 +0000

As businesses embrace AI, automation, and robotics, they are entering an exciting but risky frontier where machines help drive critical decisions. While these technologies boost efficiency and innovation, even a small software error like a misguided trading bot or a chatbot giving out wrong advice can cause enormous financial and reputational damage. Traditional insurance policies often leave businesses exposed, as they rarely cover failures unique to machine intelligence, such as algorithmic bias, faulty output, or AI-induced PR crises. This submission spotlights the urgent need for “AI Failure Insurance”, a new breed of coverage that directly protects companies from losses caused by automated systems gone wrong. Real cases, from disastrous trading errors to self-driving mishaps, show that such incidents are not hypothetical. With tailored solutions from leading insurers now emerging, organizations finally have tools to safeguard themselves against the next wave of tech-driven risks, bridging the gap between innovation and accountability in a truly human-centered way.

Insurance: A Natural Lever for Sustainability

Fri, 08 Aug 2025 08:51:40 +0000

This video explores the insurance industry's critical role in addressing biodiversity loss and promoting environmental sustainability. It introduces foundational concepts—biodiversity, natural capital, and ecosystem services—and highlights their often-overlooked importance in economic planning. Despite their importance, natural resources are being consumed 70% faster than they can regenerate, with natural capital declining by 40% since 1992. It emphasizes the urgency for the insurance sector to act, aligning with the 2022 Global Biodiversity Framework, particularly Targets 15 and 19, which call for reducing negative business impacts and mobilizing $200 billion annually for biodiversity by 2030.A three-stage pathway is presented to guide industry transformation: establishing an interface with nature through collaboration with academia and multilateral organizations, implementing biodiversity-positive solutions, and redirecting financial flows to support long-term environmental goals. Existing initiatives (e.g., TNFD and UNEP-FI) are already facilitating this shift.Four actionable portfolio strategies are outlined: insurance for ecosystem services, conservation guarantees via financial instruments, cross-border risk transfer to support sectoral transitions, and nature-responsive traditional insurance lines. These approaches demonstrate how insurers can integrate ecological considerations into product design and risk management. The video concludes with a call to leverage the sector’s influence to build a resilient, nature-positive future.

Climate. Risk. Actuary.

Fri, 08 Aug 2025 08:35:41 +0000

Climate change is no longer a future threat — it’s a present-day reality. From deadly floods in Himachal Pradesh to Chennai’s crippling water crisis and the devastation of Cyclone Amphan, India faces mounting climate challenges that demand urgent, data-driven responses. This mini-documentary explores the evolving role of actuaries in a climate-stressed India. As risk professionals, actuaries are now at the forefront — integrating environmental data with financial modeling, advising on reinsurance, designing innovative insurance products, and leading sustainable investment strategies. Through real-life Indian case studies, cutting-edge tools like catastrophe modeling and ESG stress testing, and a forward-looking vision for resilience, this video captures how the actuarial profession is stepping up in the era of climate disruption. Whether you're an actuary, policymaker, or someone passionate about sustainability — this is our call to action.

The Only Insurance Your Career Needs

Fri, 08 Aug 2025 08:32:47 +0000

What if your skills had an insurance policy? In a rapidly evolving AI-driven world, obsolescence isn’t fiction—it’s a financial risk. This TED-style talk introduces Skillset Insurance, a revolutionary actuarial concept that quantifies the risk of human skill becoming outdated, and creates a safety net to protect careers before it’s too late. Using formulas like Skill Decay Rate, Probability of Displacement, and Adaptive Upskilling, we calculate an individual’s Human Capital at Risk (HCaR)—a technical yet practical way to assess career vulnerability. The talk explains how this model can be used to design personalized insurance products that fund retraining, reduce turnover, and create a resilient workforce. Through storytelling, humor, and real actuarial math, we explore how this policy could become the future of employment benefits, transforming how companies value their employees—and how individuals take charge of their relevance. Whether you’re an actuary, a decision-maker, or simply someone worried about being replaced by a machine this session will not only inform, but inspire action.

The role of insurance in the low-carbon transition

Fri, 08 Aug 2025 08:11:36 +0000

As global efforts toward a low-carbon economy accelerate, insurers face both new risks and new responsibilities. This presentation explores the critical role insurers—and pricing actuaries in particular—must play in managing climate-related transition risks. While financial institutions are increasingly supporting green investments and low-emission initiatives, insurance companies are uniquely positioned to underwrite risks associated with the shift to a sustainable future. From technology performance guarantees to carbon credit protection and nature-based solutions, innovative insurance products can directly support businesses in their transition. Pricing actuaries are not only responsible for setting adequate premiums but also for designing risk-sharing structures, considering reinsurance, and leveraging capital markets through tools like Insurance-Linked Securities (ILS). By transforming transition risks into insurable events and distributing them through capital markets, insurers help align economic incentives with climate goals. This makes the burden of transition a shared societal task—accessible and manageable for all. The actuary’s role thus expands beyond technical pricing to shaping sustainable solutions that contribute to both business viability and public good.

Nuclear Verdicts: Measuring Court Inflation

Fri, 08 Aug 2025 07:42:19 +0000

How can insurers prepare for the unpredictable rise of nuclear verdicts and the silent erosion caused by court inflation? In this video, Brazilian actuary Gustavo Henrique unveils a global initiative aimed at redefining how the industry understands and responds to legal risk. Backed by data, actuarial science, and international cooperation, the proposal promises to shift the way insurers anticipate judicial volatility. A new framework is coming — and it might become the standard for managing legal uncertainty in the insurance world.

Flexsurance: Insurance That Works When You Do

Fri, 08 Aug 2025 07:39:53 +0000

In this inspiring pitch, South African actuary Hannah Giliomee introduces Flexsurance—a bold reimagining of income protection designed for the informal and gig economy. Through compelling real-life stories and global data, she highlights the growing disconnect between traditional income protection cover and the realities faced by billions of workers with unpredictable incomes. Flexsurance is a usage-based, adaptive insurance solution that responds to the needs of people like food delivery drivers, market vendors, and domestic workers—individuals who earn irregularly and remain excluded from conventional financial safety nets. By leveraging mobile technology, AI, and modular design, Flexsurance offers coverage that is inclusive, resilient, and sustainable, without the barriers of fixed premiums, complex underwriting, or formal employment verification. This innovative model aligns with actuarial principles of fairness, sustainability, and mutuality, while embracing the diversity and fluidity of modern work. It simplifies access, adapts to income patterns, and uses real-time data to ensure long-term viability. Hannah’s vision is clear: to uphold the actuarial profession’s legacy of trustworthy protection while expanding its reach to those who remain uncovered—ensuring no one is left behind in an increasingly uncertain world.

New Age Insurance for Power Challenges

Fri, 08 Aug 2025 07:23:01 +0000

Loadshedding is a major challenge for South African businesses, leading to financial losses, damaged stock, and stalled operations. This video explores how blockchain technology, smart contracts, and stablecoins like xZAR offer a new approach to risk protection. When the national grid operator schedules multiple blackouts, smart contracts can automatically trigger insurance payouts. No calls, no paperwork, no delays. This system enables fast, fair, and transparent cover for high-frequency, low-severity events. By shifting away from traditional models, blockchain-based insurance allows small businesses to stay resilient, even in the face of ongoing power disruptions. The video breaks down how the model works and highlights its potential to transform the future of financial protection in South Africa.

Charting your course to climate resilience

Fri, 08 Aug 2025 07:19:43 +0000

Did you know that globally, we need to invest USD 7.4 trillion in climate action each year until 2030 to have a liveable planet? That’s nearly five times the current funding levels. So, what can we do about it? As actuaries, we help businesses make financial sense of the future. Why not use our skills to support businesses in making risk-informed, strategic decisions by communicating the urgency with which we need to invest in climate action? Acting now can help businesses protect their people, their brand, and their bottom line. This is an open invitation for you to leverage your actuarial expertise to steer your company (and humanity!) toward a climate-resilient, sustainable future. Together, we can build the liveable planet that we all deserve.

LossLess: Insuring Recovery, Empowering Change

Fri, 08 Aug 2025 07:11:52 +0000

LossLess pioneers Behavioural Risk Insurance - the first actuarially rigorous insurance category that rewards positive behaviour change rather than compensating for loss. Whilst traditional insurance prices adverse events, LossLess prices recovery milestones. Our breakthrough: applying 150 years of actuarial science to human psychology. We hope to develop Behavioural Risk Tables - like mortality tables, but modelling relapse probability by demographics, support systems, and stress triggers. Using modified Credibility Theory, we refine predictions as individual and peer group data accumulates, with verification quality scores ranging from self-reporting (0.3) to multi-modal monitoring (1.0). LossLess targets gambling addiction's USD 420 billion crisis through milestone-based payouts - participants receive $200-400 for verified 3, 6, and 12-month recovery achievements. This isn't wellness theatre; it's mathematically sound insurance. The actuarial innovation creates an entirely new product category, Behavioural Risk Insurance. Our pilot, LossLess, aims to prove that behavioural risk can be quantified with the same rigour as mortality risk. LossLess demonstrates actuaries can architect human resilience, not just manage catastrophe - proving our profession's evolution from risk calculators to social innovators.

Beyond Quantification: Rethinking Risk

Fri, 08 Aug 2025 07:07:10 +0000

Facing unprecedented uncertainties, actuaries stand at the threshold of a profound shift. Rather than merely quantifying and transferring risk, the next breakthrough lies in preventing it, unlocking real impact for customers, insurers, and society at large. Key areas where actuaries can lead risk reduction:

Building resilience: designing insurance that funds adaptive upgrades and rewards prevention, as seen in Flood Re’s Build Back Better scheme.
Real-time risk alerts: integrating live data and claims signals into models to trigger timely, customer-focused actions.
Reducing risk at source: spotting emerging patterns across portfolios and partnering with manufacturers and developers to elevate safety standards.
Interactive products: creating fair, transparent scoring systems for telematics and health-tech apps that incentivize safer behavior and cut accident rates by up to 25% in six months. By shifting from indemnification to protection, actuaries can deliver lower premiums, fewer claims, and a safer world. It’s time to redefine actuarial innovation: not as faster calculations, but as smarter, integrity-driven solutions that change risk and change lives.

What is an actuary and how can actuaries help limit climate change?"

Fri, 08 Aug 2025 06:56:25 +0000

This video centres around my realisation that 2050 is really not that far away. There is no time to lose in changing course on climate change and the risks associated with it. The actions we take (and don’t take) will have a massive impact on children alive today – including my own! In the video I share my perspective on what an ‘actuary’ actually is. I then show how I believe actuaries are uniquely placed to advise governments and companies on how to limit climate change. I finish the video by setting out my innovation: To build on our traditional roots, diversify further and introduce Climate Actuaries.

Actuaries against Climate Change

Fri, 08 Aug 2025 06:44:16 +0000

Actuaries model and predict risks but we often tend to overlook the most important one - Climate Risk! From unseasonal floods and record-breaking heatwaves to raging wildfires and prolonged droughts, climate risk is increasing exponentially and actuaries are called to action to navigate uncertainty and protect financial stability. Innovative insurance solutions and sustainability integration help build a resilient, low-carbon future.

Actuaries in Bridging the Climate Protection Gap

Fri, 08 Aug 2025 06:26:25 +0000

In a world of rising climate risks, the world’s poorest countries and communities continue to face the highest exposure with the fewest resources to recover. Low-income populations contribute little to global carbon emissions, yet they suffer the most from extreme weather events. Additionally, they often remain outside the reach of traditional insurance markets. This video explores how actuaries can help close the protection gap through inclusive insurance or microinsurance. Designed with affordability and accessibility in mind, microinsurance can provide timely support to those most at risk. However, for many, even smaller premiums remain out of reach, especially when their basic survival needs are the priority. Scaling microinsurance calls for a transformation in how they are financed. Climate Reparation Pools offer one approach where high-emission industries or wealthier nations contribute to support coverage for communities highly impacted by climate risk. By combining actuarial expertise with innovative financing, we can move beyond simply repairing losses to building true resilience. Actuaries have the tools to design sustainable solutions, quantify risk, and extend protection to those who need it most.

Actuary Man: How Actuaries are Improving Society

Thu, 07 Aug 2025 14:48:54 +0000

The media seems to be obsessed with superheroes nowadays. There seems to be a new superhero movie coming out every week. Well, to me, superheroes aren’t the people that are wearing flashy tights and play make pretend in front of a greenscreen for 2 hours. Superheroes are the people that are working day in and day out to make society a better place for everyone. In this video I attempt to look at the ways that Actuaries are using their unique skillset to make society a better place for everyone. Using humour and simple terminology I want to ensure that the everybody that watches the video, whether they are an Actuary or not, can understand what is going on; and hopefully be motivated to want to know more about Actuaries and what they’re doing in order to promote greater inter-professional collaboration and maximise beneficial outcomes for the wider society.

Building the Future of Model Driven Risk

Thu, 07 Aug 2025 14:23:25 +0000

“Actuarial Thinking: Building the Future of Model-Driven Risk Systems” is a visual and narrative presentation into how actuarial science is evolving to meet the challenges of a data-driven, risk-intensive world. Starting from its historical roots in life insurance and mortality tables, the video explores how actuaries today engage with complex systems across industries: from finance and agriculture to public health and technology. Through the lens of modeling, viewers discover how actuaries use structured assumptions and data to anticipate outcomes, validate model performance, and design responses under uncertainty. The film highlights the shift from traditional insurance frameworks to enterprise risk management, CECL loan loss projections, IBNR claims modeling, and stress testing, all while emphasizing the importance of model limitations, validation, and innovation. At the end, the video argues that actuarial models are more than tools: they are decision-making frameworks that influence people, systems, and futures. As uncertainty grows, the true value of actuarial thinking lies not in predicting every outcome, but in building adaptive, transparent systems grounded in human values. This is a call to think bigger, model better, and lead the future of risk with purpose: lead the future, with actuarial thinking.