The significance of managing the risk managers’ top three concerns: interest rate risk, currency risk, and change in regulations
Table of Content
Introduction………………………………………………………………………………...…..... 3
The intention and purpose of the topic……………………………….……………………..…….4
Time and place of the issue being presented……………………...…………………………..…..4
Other prominent risk concerned in the insurance industry……...…………………………..…….4
The analysis of the 3 different risks: Interest rate risk, Currency risk and Change in Regulation..5
Interest rate risk………………………………………………………………………...…5
Currency risk……………………………………………………………………….…....13
Change in regulation……………………………………………………………………..17
Conclusion……………………………………………………………………………………….23
Bibliography
Introduction
The term- traditional risk management concept focuses on, primarily, the pure risks rather than the operational, market, credit and other type of risks. Today the risk management concept is the recognition of conscientiousness to identify, define, quantify, categorize and control all of the risk facing the organization or entity. The risk involved in the market such as interest rates, changing regulations and currency risk can create uncertainties to the people involved with managing and running a business which grip these aspects. The top three concerns of risk managers in the current state of affairs are interest rate, the volatility of the currency markets and changing regulations, which are specifically macro business risk, came to be the prevalent worries for managers (Risk Managers’ Top 3 Concerns: Interest Rates, Currency Markets, Regulations, 2012).
The companies or individuals are looking to the insurers and their products that deal with these three risks (interest rate risk, currency market and changing regulation) and respond to the natures of these risks. In addition, regulatory and market forces also generate incentives for property, life and casualty insurance companies to reexamine the existing strategies, processes and infrastructures for analyzing the risk
Introduction………………………………………………………………………………...…..... 3
The intention and purpose of the topic……………………………….……………………..…….4
Time and place of the issue being presented……………………...…………………………..…..4
Other prominent risk concerned in the insurance industry……...…………………………..…….4
The analysis of the 3 different risks: Interest rate risk, Currency risk and Change in Regulation..5
Interest rate risk………………………………………………………………………...…5
Currency risk……………………………………………………………………….…....13
Change in regulation……………………………………………………………………..17
Conclusion……………………………………………………………………………………….23
Bibliography
Introduction
The term- traditional risk management concept focuses on, primarily, the pure risks rather than the operational, market, credit and other type of risks. Today the risk management concept is the recognition of conscientiousness to identify, define, quantify, categorize and control all of the risk facing the organization or entity. The risk involved in the market such as interest rates, changing regulations and currency risk can create uncertainties to the people involved with managing and running a business which grip these aspects. The top three concerns of risk managers in the current state of affairs are interest rate, the volatility of the currency markets and changing regulations, which are specifically macro business risk, came to be the prevalent worries for managers (Risk Managers’ Top 3 Concerns: Interest Rates, Currency Markets, Regulations, 2012).
The companies or individuals are looking to the insurers and their products that deal with these three risks (interest rate risk, currency market and changing regulation) and respond to the natures of these risks. In addition, regulatory and market forces also generate incentives for property, life and casualty insurance companies to reexamine the existing strategies, processes and infrastructures for analyzing the risk
Bibliography: Coelho, H. (2013, August 19). Insurers prepare for interest rate hikes. Www.risk.net. Retrieved from http://www.risk.net/insurance-risk/feature/2289337/insurers-prepare-for-interest-rate-hikes Currency Risk Evolving Insurance Regulation-A new Dawn (Rep.). (2013, March). Retrieved http://www.kpmg.com/Global/en/IssuesAndInsights/ArticlesPublications/evolving-insurance-regulation/Documents/evolving-insurance-regulation-2013.pdf Fleuriet, V., & Lubochinsky, C Harrington, S. E. (2009, September). The Financial Crisis, Systemic Risk, and the Future of Insurance Regulation (Rep.). Retrieved http://www.naic.org/documents/topics_white_paper_namic.pdf Hay, L Vaughan, T. M. (2009). The Implications of Solvency II for U.S. Insurance Regulation.Social Science Research Network. Retrieved from http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1350539