1. Advanced Topics Panel and Small Group Project Moderator: Alice Underwood, FCAS, Executive Vice President, Willis Re Inc. Panelists: Charles Goldie, FCAS, Senior Vice President, Manager of Specialty Lines, Partner Re U.S. Jeff Dollinger, FCAS, Senior Vice President & Chief Actuary, Endurance Reinsurance Corporation of America Daniel R. Kamen, FCAS, Vice President, Folksamerica Reinsurance Company

2. Paul Ingrey’s “Reinsurance Clock” Pricing starts to drop Companies compete to increase market share Prices fall dramatically Profits slide Results horrible Pricing CANNOT go lower EUPHORIA! All companies flourish Capacity gets expensive Prices up sharply Crunch AM Best writes this decade’s “letter of concern” Source: David Skurnick, “The Underwriting Cycle” http://www.casact.org/pubs/forum/93sforum/93sf377.pdf

3. What Triggers Underwriting Cycles? Catastrophic events New legal theories Interest rates Wall Street The demands of growth Naïve capital

4. What Fuels Underwriting Cycles? You get the money FIRST… …and you pay claims LATER Incentive plans “Feeding the Beast” Herd mentality Actuaries?

5. What Dampens Underwriting Cycles? Regulation Nimble capital Actuaries?

6. What’s the Actuary’s Role?