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The
analyses we perform on the basis of our Corporate Risk Adjustment
to Capital (C.R.A.C.©) methodology are applied to medium
or large businesses, in a variety of industrial sectors.
- The
chief financial officer of an aerospace client wanted to
quantify the added value of its reinsurance captive at group
level: our analysis showed
that the captive, which had been in existence for several
years, was creating value for the group, but that additional
value creation could be achieved by increasing the retention
level of the captive program.
- The
risk manager of a telecommunications company wanted to demonstrate
to his board the efficiency of his risk financing strategy:
our client already had a clear idea
of the multiline program he wanted to set up and he asked
us to verify that such a program would indeed increase the
added value for the group without reducing its protection.
The results of our analyses regarding the proposed new program
were of real benefit since they demonstrated that the new
program was simultaneously improving protection and creating
greater value. These conclusions were presented to the executive
committee and board members, who were rapidly convinced
of the soundness of the risk manager's proposal.
- A
medium sized firm active in energy distribution needed to
confirm that its existing risk financing structure was protecting
its ratios against any decrease in cash flow greater than
5% : the analysis we
performed demonstrated that the retention level was excessive
and that a re-engineering of the structure was necessary
in order to reach the target of a maximum 5% decrease in
cash-flow. We also demonstrated that this decision would
reduce value creation and we quantified that cost.
- A
worldwide company operating in the chemical industry had
difficulty in finding the most suitable structure for its
insurance and reinsurance program : the
results of the analysis we conducted enabled the client
to structure and completely design a new risk financing
program, which would maximize value creation while adequately
protecting the key ratios. In addition, we helped the risk
manager to build a file for underwriting negotiations, in
which were included the actuarial analysis of risks that
we had carried out and a proposed pricing-scheme for the
new structure.
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