(Doha Corniche in the capital city of Qatar. Photo credit: Govorkov.)
Qatar Reinsurance Company LLC (Doha), the reinsurance arm of Qatar Insurance Company (QIC), the largest insurance conglomerate in the Middle East region, has signed a multi-year license for Conning’s (Hartford) GEMS Economic Scenario Generator (ESG) software. Qatar Re will use the Conning solution as the stochastic driver of market and credit risk for the calculation of regulatory capital, and for business planning purposes.
“We chose Conning because we were looking for a partner to provide economic and investment modelling expertise in support of our actuarial and risk functions,” commented Mark Cockroft, Chief Actuary, Qatar Re. “The GEMS software provides us with advanced models that have the flexibility to be recalibrated with the built-in tools for an efficient stress and scenario testing process.”
Conning describes its GEMS software as a state-of-the-art economic scenario generator that simulates future states of the global economy and financial markets using leading-edge economic models, providing full market risk and asset class coverage. Its financial models ensure that simulations provide realistic representation of extreme events such as those that occurred in the 2008 financial crisis, according to the vendor. GEMS ESG is used by insurers for applications such as Solvency II, economic capital modeling, market consistent embedded value calculations, stochastic liability and capital valuation, asset portfolio optimization and derivative and hedging strategies.
Meeting an Industry Leader’s Requirements
Qatar Re is a new company that has quickly established itself as a leader in reinsurance markets and risk management, according to Hamish Bailey, head of European business development for Conning’s Risk & Capital Management Solutions business. “Conning is delighted to have been chosen to support Qatar Re’s ambitions to lead industry best practice with the implementation of GEMS advanced risk models,” he says. “When evaluating competing solutions Qatar Re looked for models that were well-documented, easy to use, transparent and yet sophisticated enough to capture the key market and credit risks that are relevant to their business.”
The level of service they receive from Conning’s team was also a key consideration for Qatar Re in selecting a partner from among several competitors, according to Bailey. “The Conning solution met all of these requirements and we look forward to a strong and growing relationship with Qatar Re,” he adds.