Compliance

The financial success or failure of a property & casualty carrier largely depends on the company's ability to manage risk. Based on sophisticated actuarial models, carriers can formulate a risk model for virtually every type of physical risk exposure, and through these assumptions decide whether the risk is worth bearing.

Advances in catastrophe modeling technology are enabling carriers to take a more microscopic approach to assessing underwriting risks and predicting losses.History does repeat itself. Between 1989 and 1999, insured losses from hurricanes that struck the United States, when adjusted for inflation, totaled $45.7 billion, according to Insurance Services Office Inc. (ISO), New York.

In a world where even the smallest insurance company can advertise its wares to a global audience, some new and not-so-new compliance issues arise.Compliance specialists play far too limited a role in the development of insurers' Internet strategies, says Gary Hernandez, an insurance regulatory specialist with Sonnenschein Nath & Rosenthal, a San Francisco-based law firm.