Description: This paper advocates asset/liability management for pension plans. It identifies the economic factors that influence the economic value of liabilities and discusses the typical asset portfolio that results.

Description: it discusses the framework and modeling of the market consistent valuation of fixed indexed annuity, against the backdrop of the convergence of accounting standards and internal risk management.

Description: Congress once again turns to defined benefit pension plans as a misguided source for financing programs that have nothing to do with retirement.

Description: This article looks at EVA calculation, its various issues and how it can be used to better manage a company. From Society of Actuaries Financial Reporting Monograph, M-AS99-1.

Description: Obsolescence of physical assets and processes is a major component of operational risk for some companies. A simulation experiment shows that managers, who consider the retirement and replacement of individual assets in isolation, have rational incentives, due to risk aversion and uncertainty, to defer the replacement of assets past a time that is optimal from the perspective of the shareholder who owns the entire portfolio of such assets. This results in measurable wealth destruction, —and a demonstrable opportunity to significantly enhance a company’s value. A practical decision model for the replacement timing of fixed, physical assets, which creates wealth by minimizing the long-term consumption of scarce resources, is provided.

Description: A discussion of the three kinds of reserve strengthening

Description: This paper defines Distributable Earnings as the generalized pricing and valuation framework for financial contracts containing the requirement to hold capital or reserves in support of the obligations. It examines the Market Value paradigm and its foundation arising from the pricing of fixed income securities. It reconciles these two methods, showing that market value methods ignore mandatory capital and reserve requirements, which carry both risk and cost. The paper makes the case for the Distributable Earnings framework, not Market Value, as the true basis for economic value for these financial contracts. Finally, it concludes that this framework must be employed in risk-management processes, else fail to recognize a significant source of risk.

Description: Attempts to Quantify Potential Impact of Pandemic Influenza on the U.S. Life Insurance Industry

Description: An economic value model is used by the National Hockey League NHL to allocate salary budgets between players using a method based principally on salary comparison between players with similar statistics.