Conning Viewpoint: Modeling May Help P&C Insurers Manage Impact of Inflation on Both Sides of Balance Sheet
March 14, 2022
First in Series of Viewpoints Examining How Firm’s Modeling Software and Expertise Helps Insurers Develop Holistic Enterprise Solutions
HARTFORD, CT – March 14, 2022 –Leading global investment management firm Conning has posted a Viewpoint highlighting how P&C insurers may benefit from using modeling techniques to better understand the impact of inflation on their businesses. The article is the first in Conning’s “Risk Matters” series, developed to illustrate how the firm’s proprietary modeling capabilities and expertise helps insurers develop holistic enterprise solutions.
“Inflation impacts the inflation-adjusted values of the portfolio, income and returns,” said Matt Reilly, a managing director in Institutional Solutions and lead author. “The impact on liabilities can be more complex, and it can have greater effect on insurers with longer tail risk. Assessing all these factors is a demanding process, which is why we think our modeling software is so valuable in our analysis to help insurers develop strategies that best meet their unique needs.”
“As with any risk, it’s important to strike a balance between the magnitude of inflation risk and the cost associated with a mitigation approach,“ added Yazeed Abu-Sa’a, a director in Institutional Solutions and co-author. “While being ready to manage the inflationary impact is important, Conning believes the most valuable strategy for an insurer’s long-term success is one tested across a range of economic environments.”
Conning’s strategic asset allocation (SAA) process helps clients develop diversified investment strategies customized to their specific needs and risk tolerance, leveraging proprietary software such as our GEMS® Economic Scenario Generator and FIRM® Portfolio Allocator.
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Conning (www.conning.com) is a leading investment management firm with approximately $215 billion in global assets under management as of December 31, 2021.* With a long history of serving the insurance industry, Conning supports institutional investors, including insurers and pension plans, with investment solutions, risk modeling software, and industry research. Founded in 1912, Conning has investment centers in Asia, Europe and North America.
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