consulting to p&c companies

[speedyactuary]

There is an increasing number of consulting companies providing support to p&c companies? What exactly would these companies be doing????

I would imagine any p&c insurance company has its own actuarial staff/software etc ...so what would they be asking the consultants to be doing for them? beats me!! :wall:

[joeorez]

Many insurance companies want an outsider's actuarial opinion on loss reserves, either for management comfort or accounting audit/Best's & S&P/merger & acquisition etc. purposes.

Smaller insurance companies may have an in-house actuarial staff, but no one who has the actuarial credentials to issue the formal loss reserve opinion.

Consultants deal with a large number of clients and may have greater experience, breadth and depth, in some areas, than the in-house actuarial staff.

[Wigmeister General]

In addition to loss reserve opinions, many companies seek outside consulting actuaries to assist with ratemaking and rate filings. I am aware of two consulting firms that provide these services to both large and small insurers in the U.S., and these consulting firms do quite well, thank you.

[Tobias Funke]

There is an increasing number of consulting companies providing support to p&c companies? What exactly would these companies be doing????

I would imagine any p&c insurance company has its own actuarial staff/software etc ...so what would they be asking the consultants to be doing for them? beats me!! :wall:

Also simply because consultants are much much brighter than the average in-house actuary. Major differential there.
(just kidding)

New set of eyes looking at the stuff sometimes helps. Sometimes a company needs a little input when going into a new market and the outside consultant might have some expertise that can help, etc.

[chinese_girl]

One of my college classmates is working for a P&C consulting company. She has a lot of workers compensation projects for those giant companies that self insure most of their risks, these companies also ask the consultants to calculate how much excess insurance they need and at what price. Another hot area I know is the pollution liability evaluation and catastrophe risk modeling. My company paid a lot of money to get the hurricane modeling data from the consulting companies every year.

[Wigmeister General]

... And I was very pleased to do the work, especially after I received the check. :P

[Vic Romano]

I would imagine any p&c insurance company has its own actuarial staff/software etc ...so what would they be asking the consultants to be doing for them? beats me!! :wall:

It wasn't always this way but has gradually become so. As a result, the "average" consulting project has shifted up the ladder of expertise.

[joeorez]

And there are tiny companies who may feel thery are too small to justify the expense of a full-time staff actuary.

Consultants for such companies do rate reviews, rate filings, etc.

Although the cost of a couple of serious rate filings could approach the salary of an actuarial trainee.

[Wigmeister General]

joeorez,

I can tell you that some of the consulting done for rate filings is for HUMONGOUS Insurance Company. It's a bone of contention for the actuaries at these firms because they wonder why such a function would be outsourced when there are 20 capable staff members.

I don't ask too many questions. When someone offers me enough money, all I ask is, "Who is the target?" and "Do you want me to send flowers in your name?"