The North Atlantic hurricane season is upon us again, and 2020 is expected to be more demanding than normal.  As the industry emerges from the first wave of COVID-19, liquidity risk management should be prominent on board agendas.

In September 2019, the PRA published their Supervisory Statement SS05/19  – “Liquidity risk management for insurers”.  Compliance should be straightforward, but as its one-year anniversary approaches, insurers should review progress against its requirements.

Key Areas Recap

Key areas discussed in detail within SS05/19 are:

• Formulation of a Liquidity Risk Appetite Statement;
• Documented policies and procedures;
• Key liquidity driver identification;
• Forward-looking scenario analysis and stress testing;
• Establishment and composition of appropriate liquidity buffers;
• Monitoring and reporting; and
• Contingency planning.

Contact us at enquiries@marcuson.co or email your regular Marcuson Consulting contact if you would like help reviewing your approach or for a health-check on any aspect of your risk management framework.