Challenge

A new hybrid fronting insurer fielding a growing portfolio of MGAs required comprehensive actuarial function support that covered quarterly reserve reviews, Solvency II capital requirement reviews and fulfilment of the chief actuary role.

These processes had to be established for the first time to ensure regulatory compliance and meet expectations of reinsurance partners and investors.

Approach

Delivering with limited data: We leveraged internal and external benchmarks to set reserves for lines of business with limited data. We sought discussions with the MGAs to understand their business operating model and competitive advantages, which was balanced with emerging quantitative data in setting key development patterns.

The right specialist for the job: The actuarial function required breadth across specialist areas, such as reserving, capital and pricing. For each area, we drew upon the expertise of specialists within the broader Milliman team, bringing a high level of experience to each domain and scaling effort as required—a key advantage over a dedicated fixed in-house team.

Building in partnership: Through the chief actuary role, we were responsive to changes in business ambitions and priorities, representing an independent actuarial viewpoint in internal discussions and creating feedback loops through to the actuarial function. Reserving outputs were fed back into the business for performance monitoring, and frequent in-person contact helped to provide greater awareness and education around the actuarial function and where it could add value.

Impact

We established key processes and deliverables for the actuarial function, setting a solid foundation for future scalable growth. Our quarterly reserving reports, provided to the relevant board committees and evolving over time with the maturity of the business, contained a trusted source of in-depth analysis ready for key stakeholders.

Quarterly reports were supplemented on an ongoing basis via timely actuarial advice to key decision-makers across underwriting teams, claims and reinsurance management, which helped grow the business in line with the stated risk appetite.