Superannuation

Superannuation

Using operational risk scenarios to calculate an internal risk based capital position

As a collaboration between the Actuaries Institute Superannuation Practice Committee (SPC) and Risk Management Practice Committee (RMPC), a small working group of actuaries (Tim Gorst, Vivian Dang, Matthew Burgess, Taleb Hassan, Bloreen Abbasi) worked together to explore the use of risk based scenario analysis in developing an internal operational risk-based capital (ORBC) position for Australian Super Funds. Their work considered the following core question “Is there a pragmatic way that a set of operational risk scenarios can be both parameterised and then aggregated to infer an internal ORBC position for an Australian Super Fund?”

Highlights

What is the relationship between unemployment rate and disability claims experience?

An economic downturn is intuitively associated with higher morbidity claims costs in general and, unemployment rate tends to be a fairly good proxy for the state of the economy. However, the relationship between unemployment rate and disability claims experience is poorly understood and it is a challenge to accurately quantify the link between the unemployment rate and disability claims costs.

COVID-19 and Mental Health

While the direct health implications of COVID-19 has been widely analysed and discussed, the more hidden and potentially more profound impact on mental health is often overlooked. This blog article discusses the impact of COVID-19 on mental health, as well as some of the implications for life insurers.