RMS Launches New Platform for Life Insurance and Pension Risk Analysis
RMS LifeRisks™ is a Mortality Scenario Generator to Manage Risks from Longevity and Excess Mortality
Newark, Calif. -
October 04, 2012 -
RMS today announced the launch of RMS LifeRisks™, a modeling platform for the life insurance and pension risk management industry. RMS LifeRisks enables companies to assess an integrated view of trend and shock risks into their life and annuity portfolios that is underpinned by detailed medical research and social change projections.
Through RMS LifeRisks, companies can access a suite of mortality risk models, including the RMS® Longevity Risk Model and RMS® Excess Mortality Risk Model for pandemic, terrorism, and natural catastrophe risk, to manage mortality risk for six countries: Canada, France, Germany, the Netherlands, the United Kingdom, and the United States.
"RMS mortality scenarios have already become the currency for transferring excess mortality and longevity risk to the capital markets. The launch of the RMS LifeRisks platform makes it possible to bring RMS models in-house, and integrate the analytics into our clients’ internal risk management processes," said Peter Nakada, managing director at RMS. "They can now explore and parameterize the models, and operationalize the insights provided for their own specific business portfolios."
RMS LifeRisks helps European life insurance companies fulfill Solvency II requirements by incorporating their view of risks in their routine management and monitoring of their mortality underwriting risks. The analytical insights provided by the models are used for many other applications beyond regulatory compliance—clients in the United States and other countries currently use RMS models for risk transfer decisions, capital optimization, and capital markets transactions.
"There is a strong demand for longevity de-risking solutions," Mr. Nakada continued. "We're confident that our role in providing independent risk analysis can facilitate the growth of this market, and gain the respect of investors. We believe the launch of RMS LifeRisks is an important step toward putting analytical tools into the hands of the key players in this growing market."
RMS mortality risk models generate a large number of future mortality trend and shock scenarios through “stochastic” scenario modeling, a process requiring powerful computational resources to derive useful and detailed risk analytics. The RMS LifeRisks platform provides clients with scalable cloud computing power that can be accessed with minimal IT expenditures.
"Enabled by the cloud, RMS LifeRisks provides a powerful analytical resource with virtually unlimited processing power to meet the client demand," said Derek Blum, vice president of solution development at RMS. "The growing sophistication of models needed to manage mortality risk, and the market's need to incorporate these views into their business process means that computational power is a vital ingredient in the risk management process."
RMS is currently developing additional capabilities for future releases, including analysis of the hedge benefits between mortality and longevity risk.