《wp_revisiting_role_of_ins_co_alm》.pdf

White Paper October 2010 Revisiting the Role of Insurance Company ALM within a Risk Management Framework Insurance Asset Management Executive Summary Inside: As insurance sector fundamentals have improved over the past two years, we take a fresh look at the role of insurance company Asset Liability Management (ALM) and Executive summary. . . . . . . . 1 investment strategy. We look back at the impact of the financial crisis on US insurers, Complex landscape and how the industry responded. We observe signs of progress on financial statements for insurers. . . . . . . . . . . . . . . 2 that began to take hold starting in 2009, including improved capital adequacy, net History of the financial income and lower realized losses as compared to 2008. However, when we look more crisis from US life closely at the post-crisis rebound, we note these improvements have largely been insurers’ perspective . . . . . . 3 driven by regulatory changes, capital raising and reductions in dividends paid. In addition, the current prolonged low interest rate environment is expected to produce GSAM’s approach to ERM. . . . . . . . . . . . . . . . . . . 7 lower investment earnings potential, albeit partially offset by redeployment of elevated cash balances and improved performance on alternative investments. Now more than GSAM’s ALM and ever, we propose a revised ALM, risk management an