Page 67 - Risk Management in current scenario

Assets and Liability

Management in Life Insurance

This talk was presented in the 2nd Annual Market Risk

Management Summit, 2017 Organized by Inventicon
held on 12 and 13th December 2017 at Holiday Inn
Mumbai International Airport

Introduction
In this presentation, we shall talk about how the interest rate in India
have moved in last couple of years and what have been the yield on the
10-Year G-sec bond to understand the challenges that it presents to the
insurance industry particularly those selling maturity guarantee products.

We shall also look at the typicality of the assets and management
challenges by going into the skin of the things and understand the
insurance business. In such cases, how assets should be allocated to
manage the assets and liability mismatch risk.

We shall also look at the recent research in the context of the ALM
challenges that traditional non-par products presents and how does the
future look like in terms of emerging regulatory changes and falling
interest rate regime.

Market Risk
From a theoretical point of view, market risk relates to volatility of the

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