NATIONAL
INSURANCE ACADEMY
PUNE
P850 -
PROGRAMME ON RISK BASED CAPITAL (RBC) (LIFE)
(2025 - 26)
Background:
India has one of the
fastest growing Insurance markets in the world, with significant demographic
advantages. India will be the sixth
biggest market for insurance in the world by 2032, with its total insurance
premiums growing by 14% annually in nominal local currency terms over the next
decade. The insurance sector has continued to grow in scale over the years. Life
insurance accounts for about 75 percent of the total premium, reflecting the
role played by life insurance in savings and investment markets. (Source:
Swiss-Re Report).
The Insurance Regulatory
and Development Authority of India (IRDAI) has been taking various initiatives
to align the Indian Insurance Industry with the global best practices with the
aim of ease of doing business and finally to achieve the objective of
‘Insurance for All by 2047’. One of the key initiatives pertains to
development and implementation of a Risk Based Capital (RBC) Framework for
Indian insurance industry.
This framework would serve
as a pivotal mechanism which would enable insurers to maintain an appropriate
level of capital commensurate with the risks inherent in their insurance and
reinsurance operations. Thus, it would act as a catalyst for insurers in
optimizing capital utilization and ensuring efficient risk management. RBC’s
goal is to ensure that risk-based capital supports enterprise risk so that
companies become more proactive in managing the risk. With the right approach
and support from all stakeholders, a robust risk-based capital regime will take
the Indian insurance industry to the next level.
Objectives:
The
programme aims to cover the following key aspects of RBC:
§
The concept of RBC -- Risk
Based Capital/Solvency- II in Life Insurance.
§
Determining Risk Appetite
in Insurance Business under RBC framework, and what matrices are relevant to
determine the risk appetite aligning with the business strategy of the insurer.
§
Determining Risk Capital
using (standard/dynamic) capital assessment models and allocation of capital
across different types of risk exposures including operational risk, under RBC
guidelines.
§
Role of Stress testing and
Scenario analysis in determining Solvency capital requirement.
§
Role of Reinsurance and
(ART- Alternative Risk Transfer) mechanism in solvency capital under dynamic
scenario.
§
Changing Risk Governance
structure under RBC and challenges in implementation of RBC.
Contents:
§
Concept and Foundations of
RBC and Risk Management
§
Risk Management Frameworks
(ERM, ORSA)
§
RBC Frameworks and Models
(Solvency II, RBC 2.0)
§
Risk modelling techniques
(e.g., stochastic modelling, scenario analysis)
§
Risk Identification and
Assessment & Risk Quantification and Measurement
§
Role of Stress testing and
Scenario Analysis in Solvency Risk Capital
§
Role of Risk Governance
under RBC
§
RBC Application in Life
Insurance, Risk Modelling and Simulation
§
Regulatory Requirements
and Compliance, RBC Reporting and Disclosure
§
RBC Implementation
Challenges and Best Practices
Participants’ Profile:
Officers (AO and above
cadres) working in CO/ZO Actuarial department, CO Investment department, CO P
& GS, ERM and F & A department of LIC and Risk Management executives
from the various Private Life Insurance Companies in India.
Duration:
2 days
I.
29.05.2025 - 30.05.2025
II.
07.07.2025 - 08.07.2025