Managing Capital Resources - Searchlight Insurance Training

Managing Capital Resources

The FCA has spelt out its concerns that brokers may underestimate the risks they face. They can fail, as a consequence, to maintain realistic working capital and solvency which may expose the business to failure.

Simply maintaining the MIPRU solvency requirement does not necessarily meet the wider Threshold Condition 4, the requirement to hold adequate financial resources.

This core workshop combines risk and financial management to address potential regulatory exposure and a very real business risk

Level:

Duration: 1 day(s) CII CPD Hours: 6
     

WORKSHOP OBJECTIVES

•Define the regulatory expectations of Threshold Condition 4 and MIPRU

•Summarise the basic principles of risk management

•Revise core business finance to differentiate between working capital and solvency capital

•Explore and categorise the range of risks faced by insurance brokers

•Analyse and quantify risks in terms of severity and probability

•Assess appropriate ways of funding risks

WORKSHOP CONTENT

•At the start, the workshop clarifies the FCA expectations, which of course reinforces a real business imperative

•The principles of risk and financial management are outlined to demonstrate how a business can become vulnerable. Participants will gain a better understanding of the importance of maintaining a realistic level of working capital, the need to maintain –or have access to –wider sources of solvency capital, and why the type of assets both are held in is crucial

•“The risk register is not an academic exercise”
Participants are encouraged to (honestly) determine the risks that insurance brokers face: the day-to-day and those which can threaten its existence

•Using a case study, participants in groups explore and quantify risks, translate them into capital requirements and asses possible funding solutions to ensure the business remaining a going concern