Effective Capital Management

It is important for insurers to develop effective risk and capital management to achieve target returns for the insurer's capital providers and for their policyholders. Capital management tools can also be used to ensure that the incentives and behaviours of managers are aligned with the overall creation of shareholder value.

PwC specialises in developing and implementing a range of capital management and modelling approaches to assess capital requirements. These approaches are used for internal capital assessments, determining optimal reinsurance programmes and investment strategies, capital allocation and for assessing the impact of strategic decisions on shareholder value.

PwC's risk & capital management services include:
  • Advice on the implementation and embedding of modelling tools into the management process, or review of current systems and models
  • Advice on the measurement and monitoring of operational, liquidity, systems and control risks
  • Assistance in developing a capital management framework to improve economic capital management including risk adjusted performance
  • Assistance in developing methodology for the calculation of the individual capital assessment
  • Assistance in setting up a risk control framework and risk register
  • Assistance in tailoring outputs from capital models to suit the needs of stakeholders
  • Management of the process of communication with the FSA regarding increased regulatory capital requirements
  • Negotiation (in conjunction with our regulatory experts) with the FSA for waivers to enhanced capital requirement
  • Risk assessment
  • Technical advice on the scoping, choice, design and setting of parameters for capital models as well as training staff in the use and capabilities of such tools