Risk financing
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japjots254
An insurance company can become overexposed to risk if it writes too many insurance policies for a given period without having enough cash reserves on hand to cover them. In such a case, the insurance company could potentially become insolvent if a major disaster happened and many people file claims at once. Risk financing attempts to prevent situations like this. It does this by having professionals try to analyze risk so that insurance companies only assume risks that they can manage safely. ravjot
Ravjot wrote:So is risk financing work done by actuary or done by another professional?
Sent from my Nokia 5.1 Plus using
Actuarial Info mobile appI am not sure though, I think it might be done by the Insurance Actuary because they are the ones that are relied on by insurance companies in determining risk for insurance companies.
If not, there might be a different department for this like claims dept, underwriting dept which will take care of this too.
tanmay
There are separate departments generally and the underwriting takes care of Risk generally. Risk is also of different types and may be of risk of new business, risk of lower preiums, risk of risks underwritten. so it is dependible and for the premiums or overreserving and underserving risk, Actuary is the one to look at them. Arpit Surana
tanmay wrote:There are separate departments generally and the underwriting takes care of Risk generally. Risk is also of different types and may be of risk of new business, risk of lower preiums, risk of risks underwritten. so it is dependible and for the premiums or overreserving and underserving risk, Actuary is the one to look at them.
Thanks tanmay for this meaningful insight.
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