What if we told you that insurance providers protect people with disability, life, travel, car and home cover, but also need to protect their own portfolios using derivatives?
With numerous active derivative positions, insurance providers aren’t just safeguarding policyholders, they’re safeguarding their balance sheet too.
Derivatives help insurers manage their assets so funds are available to pay claims as they arise. However, just like the policies they write, these derivatives come with obligations. They must be reported to regulators – EMIR, ASIC, and MAS are some of the major regimes.
Who knew that behind every insurance claim, there might be a credit derivative doing risk management of its own?
Check out our video below for more.
