Asset/Liability Management (Dynamic Financial Analysis)

We've yet to meet an insurance CEO who walks in the door in the morning and says, "We've gotta have a better ALM process here!" More likely, the CEO is interested in things like profitability, sales, and return on equity. Well, you can actually improve profits and return on equity when you use ALM properly.

Once you have decided on a set of asset allocation strategies, you then must combine those with different product strategies. This is done within the discipline of an ALM process that combines the knowledge of the CEO, Chief Actuary, Chief Investment Officer, and Chief Marketing Officer.

The result of combining different asset and product strategies can show you a Pathway to Profitability(tm) that means higher risk adjusted income (return) on capital and surplus.

Key Benefits:

Asset/liability management can improve communication between actuarial, investment and marketing areas. SAA can act as the analytical resource that combines the results of different strategies suggested by the CEO and these key leaders, and presents them in a clear, understandable and useful manner.

Asset/liability management can produce asset and product strategies that can improve your company's net income, adjusted for risk.

Asset/liability management can quantify the amount of risk you now have imbedded on the balance sheet. Believe it or not, you are taking a bet on interest rates. Even a so-called "matched" position is not, since capital levels must be considered. What is the amount of that risk? Are you comfortable with your interest rate bet?

Strategic Asset Alliance, 435 Martin Street, Ste. 2020, Blaine, WA 98230. Tel: 360-332-1839; Fax: 360-332-1040.