Management Consulting
Aon
Full Credential Description
In 2022, global reinsurer capital experienced a significant decline of 15%, primarily due to substantial unrealized losses on investment portfolios and increased catastrophe losses from secondary perils. This challenging environment, characterized by limited new capital formation and heightened investor concerns regarding climate change, inflation, and rising insurance claims, necessitated a strategic approach to capital management for insurers. To address these niche issues, Aon launched its Capital Advisory service in 2018, focusing on helping insurance clients optimize their capital to achieve growth and meet stakeholder expectations. Aon's tailored solution involved developing customized capital management strategies that align with the specific capital requirements of insurers and the expectations of key stakeholders, including rating agencies and investors. By leveraging robust industry benchmarking and a thorough understanding of client needs, Aon was able to provide actionable insights that matched risk with capital effectively. This holistic approach integrated expertise from various Aon divisions, including broking, analytics, and investment banking, ensuring that clients had access to the best capital solutions available. The results of Aon's Capital Advisory service were substantial. The team successfully secured, advised, and executed over 40 complex reserve risk deals, involving a total of $30 billion in reserves, demonstrating their capability in managing large-scale capital needs. Additionally, Aon advised on the formation of more than 30 new companies, guiding them through business development plans and the initial ratings process. They also facilitated the raising of capital through surplus notes for small to mid-sized regional insurers and established insurance captives to help manage risk-based capital requirements. Notably, Aon placed a $1 billion collateralized whole account stop loss for Lloyds, showcasing their ability to deliver structured reinsurance solutions tailored to client needs.