Dynamic Financial Analysis

As one of the world’s leading reinsurance brokers, BMS was quick to appreciate and promote the benefits of Dynamic Financial Analysis (DFA). The technique has been widely used to assist our clients in simulating multiple loss scenarios from various insured lines of business, determining economic capital requirements with or without reinsurance, and conducting cost/benefit analysis on alternative reinsurance programmes.

We enjoy preferred access to the market-leading DFA tool, Risk Explorer, developed by our partner Ultimate Risk Solutions, and also work closely with independent consulting actuaries. We have invested heavily in training our brokers and analysts in the use and interpretation of Risk Explorer and other tools.

Applications of DFA include

• evaluating the loss potential to an insurance company from various insured lines of business
• cost and benefit analysis in respect of various reinsurance programmes
• cost and benefit analysis of underwriting (portfolio) strategies
• determining economic capital requirements with or without reinsurance and under various reinsurance alternatives
• helping companies maximise their profitability while maintaining a desirable level of stability.

Each client has their own particular needs and we see it very much as our role to ensure that those needs are met quickly and effectively and Dynamic Financial Analysis is proving invaluable to achieving our objective.

David Spiegler
Executive Vice President and Chief Actuary
BMS Intermediaries, Inc.