Year 2011, Issue 109

Date published

28.2.2011

Table of content

  • Boyan Iliev
    ADAPTIVE MANAGEMENT IN INSURANCE
    JEL: G22
    Keywords: insurance, risk management, controlling, adaptive management, management structure
    Summary: Under the conditions of risk and uncertainty which characterizes the behaviour of surrounding elements, where the insurance company works the issue of coordinating of the work in the company arises in accordance with the changes of this surrounding. Solving this issue is a task of the adaptive management. “Adaptive management ... ... CONTENT INTRODUCTION 11 Chapter one OBJECTIVES OF THE INSURANCE COMPANY 13 1. Criteria for classifying elements of the environment of the insurance company 13 2. Internal environment of the insurance company 26 3. Types of objectives in insurance 29 4. The main objectives of the Insurance company 32 5. The system of objectives of the insurance company 44 6. Decisions on actions related to fulfillment of the objectives 52 6.1. Matrix of the results and matrix of the decision 52 6.2. Rules for decision making under the conditions of risk 55 6.3. Mathematical and statistical base of the rules for decision making under the conditions of risk 58 Chapter two ADAPTIVE (FLEXIBLE) SYSTEM OF MANAGEMENT OF THE INSURANCE COMPANY 67 1. Peculiarities of the insurance management 67 2. The system of management of the insurance company 74 3. A variant for building up of adaptive system in insurance 82 3.1. Types of management structures in the insurance 82 3.2. Units in the management structure of the insurance company 87 Chapter three RISK MANAGEMENT IN THE INSURANCE COMPANY 102 1. Introduction to the issue 102 2. Insurance – technical risk 104 2.1. Defining of insurance – technical risk 104 2.2. Specifying of the definition about insurance – technical risk 109 2.3. Causes of arising of insurance technical risk 116 3. Nature of risk management in insurance 121 4. Leveling of the risk 127 4.1. Approaches to leveling of the risk 127 4.2. Models of risk leveling in the totality of insurance company 129 4.3. Risk leveling in the course of time 133 5. Risk leveling strategies 135 6. Actions to reduce the technical risk foreseen in the program of the insurance company 142 6.1. Increasing of the number of the insurance sites 142 6.2. Leveling of risk being 143 6.3. Determining of the correlation 144 6.4. Actions against subjective risk 145 6.5. Premium tariff influence to insured composition 148 6.6. Special tariff of high risks 151 6.7. Correct assessment of the insurance technical reserves 154 6.8. Organizing of fund “Prevention” 158 Chapter four CONTROLLING IN INSURANCE 165 1. Formulation of the issue 165 2. Prerequisites for introducing a controlling- the system in insurance 166 3. Defining of the notion of controlling 170 4. Functions of controlling in the insurance 172 5. Position of the controlling in the strategic management of the insurance company 175 6. Controlling as a continuous cycling process 177 7. Peculiarities of the controlling system in the insurance system 181 8. Types of controlling in the insurance 184 8.1. Dependently on the object it is directed to 184 8.2. Dependently on the activities done in the insurance company 185 8.3. Dependently on the environment it is conducted and on the time horizon 186 8.4. Dependently on the character of the information 189 8.4.1. Controlling according to values 189 8.4.1.1. Controlling for the composition 190 8.4.1.2. Controlling of the premium revenue 192 8.4.1.3. Controlling for the security of the capital 193 8.4.1.4. Controlling for the development of the risk 195 8.4.2. “Soft” controlling 195 9. The information system–the kernel of the controlling 203 9.1. Information system data sources 203 9.2. Nature of the information system in insurance 206 9.3. A variant of the information system in insurance 208 9.4. A variant of the information system for private (operative) controlling related to the risk development in Insurance 215 9.5. Information system for controlling of the solvency of the insurance company 220 9.6. Information system for controlling of the insured composition 226 10. Organizing of the controlling in the insurance company 236 10.1. Organizing of institutional controlling 237 10.2. Functional controlling 241 Conclusion 243 References 245 Abstract Under the conditions of risk and uncertainty which characterizes the behaviour of surrounding elements, where the insurance company works the issue of coordinating of the work in the company arises in accordance with the changes of this surrounding. Solving this issue is a task of the adaptive management. “Adaptive management” in insurance is to be seen as all actions that are related to organizing and management of the company that are purposed to achieve planned results, independently on the influence of the surrounding where the company operates into. This management requires most of all creating a dynamic control structure, respective style of management and well functioning adaptive teams in the sphere of risk management and controlling in insurance.