Risk Appetite – Finding the Right Balance

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    In recent months APRA have increased their attention on risk management, aiming to improve the industry's performance in this area. One specific area of focus is each insurer's risk appetite.

    Furthermore, many insurers are reviewing their Risk Management Framework (RMF), including risk appetite, in light of testing events such as the Global Financial Crisis (or GFC, where most losses arose in areas other than Australian general insurance) and unprecedented locan and offshore natural catastrophes.

    In this article we share some thoughts based on our experiences, describing how insurers might tackle this tricky subject and clearly state how much risk (and which types) are suitable for them.

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