Economic capital for life insurers: Embedding the model

The investment in state of the art economic capital systems has been significant. Following this investment, insurance companies are looking to demonstrate benefit from the tools they have deployed. Benefit should not just be measured in calculations, but in the ability to take better, more informed, business decisions. A truly embedded and useful economic capital model brings the capital impact to life by making information available to whoever needs it, whenever it is needed. In this paper, we set out a practical framework for embedding a model and consider a specific example of how solvency monitoring capabilities can be extended to support embedding the risk strategy in the business