Page 9 - Life Insurance Today June 2015 SAMPLE
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IMPLEMENTATION OF ENTERPRISE
RISK MANAGEMENT - AS THE 2ND
STEP TO DEAL WITH THE 2ND
COHORT ISSUES OF RISK
MANAGEMENT APPLICATIONS IN
INDIAN LIFE INSURANCE SECTOR
Anabil Bhattacharya 1. Introduction : cial technology, have introduced new
and additional complexities into the
B.M.E. (Hons.), F.I.I.I. Last month, we have discussed on the activities of insurers and therefore,
Kolkata various facets of Risk Management added weight to their existing risk
processes available and applicable in universe. These reasons accentuate
Life Insurance Today Indian Life Insurance Sector. Now the insurers' growing focus upon the iden-
Indian Life Insurance sector is coming tification and measurement of risk.
of age and in terms of the Risk
Management framework, so the life 2. Concept of enterprise
insurers now need to focus on the next risk management (erm)
generation issues as far as the implemended worldwide:
implementation of Risk Management
concept and better techniques of Risk "ENTERPRISE RISK MANAGEMENT
Management is concerned. Identifying (ERM) is an integrated framework for
an individual cause of failure for any managing credit risk, market risk,
life insurance company is often not operational risk, economic capital, and
possible. risk transfer in order to maximize firm
value." ERM is also referred to as:
More possibly than not failure occurs 1. Integrated Risk Management
due to a combination factors and (IRM) or,
these may, or may not be, be visible
to common men during the months or 2. Holistic Risk Management (HRM)
years preceding failure. There is, how- or,
ever, one factor that appears com-
mon to most failures, and that is the 3. Global Risk Management (GRM).
adoption of poor risk management
practices. Globalization and deregula- In Life Insurance Companies we need
tion in financial markets, combined immediate & successful implementa-
with increased sophistication in finan- tion of Enterprise Risk Management
When it comes to success, there are no shortcuts.
June 2015 5
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