Joseph Lo looks back on some past winners of the Brian Hey Prize
The general insurance actuarial story has been one of ingenuity and sharing, collectively solving problems in
this dynamic industry. Over the past 20 years, the IFoA’s annual Brian Hey Prize for best general insurance research has brought together many high-quality research papers. We hope you and your colleagues will revisit these great papers – and be persuaded to submit a paper, too.
Past papers – still relevant
You will find that past winning and candidate papers form a treasure trove of reference material and actuarial insights. The collection covers a wide range of topics that are still highly relevant today, even if they were first penned in response to challenges of the day.
North Atlantic hurricanes remain a key accumulation risk for many general insurers and are arguably more uncertain than they have ever been, especially in face of climate change. The 2006 winner ‘Report of the Catastrophe Modelling Working Party’ is an excellent resource for anyone wishing for a deep refresher on catastrophe modelling, or a quick look-up of key modelling concepts.
As the authors of the 2005 candidate ‘Claims Inflation’ suggest, “like it or not, non-life actuaries cannot get away from claims inflation”. This could become especially pertinent in the face of COVID-19’s socio-economic consequences. Although the paper focuses on UK and US casualty lines, it touches on various concepts that all actuaries should pay attention to.
Insurance products have been increasingly commoditised and competitive for many years now. ‘Winner’s Curse’, from 2009, explores an interesting concept that is half a century old but still has implications for today’s pricing strategies and discussions around the underwriting cycle. The idea is brought to life through lucid explanation and illustrative modelling.
Effective vehicles for ideas
Whether you are looking for high-level concepts or technical details, you will find these papers both practical and accessible. Brian Hey, in whose memory the prize was set up, was himself a prolific and practical researcher, co-authoring papers on a wide variety of topics for practitioners.
In this tradition, many of the papers were creatively designed and carefully put together with actuaries who work ‘at the coalface’ in mind. ‘Winner’s Curse’ takes the reader from conceptual through to increasingly technical content, while the 2004 winner ‘UK Asbestos – The Definitive Guide’ was accompanied by Excel workbooks that demonstrated some of the models discussed. Its bibliography was not just a list of cited works – it also contained useful précis, so the busy reader could get the gist of the supporting papers straightaway.
For researchers and research users, the traditional research paper format still represents a more effective standalone vehicle for ideas in the profession than presentation slides. For the reader, papers carry important details more easily. New ideas can be put forward in logical ways and demonstrated by examples, with assumptions and arguments that tend to be much clearer and more precise.
Writing a paper helps to maintain discipline, leading to higher quality in the research itself. Putting ink on paper demands accuracy in the use of words, creating the chance to form better insights.
Over to you
I hope that you are persuaded to discover or rediscover the Brian Hey Prize papers as comprehensive references or intellectual stimulants to supplement your actuarial work. Sharing and discussing them with your colleagues – actuarial or otherwise – could be helpful for informing and re-informing your teams, and be a good way to undertake CPD.
The general insurance practice area buzzes with member-led research activities: perhaps you could also be rolling up your sleeves and writing a paper to share your insights? It may feel daunting, but there are ways to make the task more achievable. You may want to write up your findings regularly in smaller chunks during your research, perhaps even publishing them on blogs. Teaming up with others as co-authors could be useful, too. Remember that papers do not have to be long and all-encompassing to be effective: a nugget of interesting insight may well require only a few sides of A4 to carry the details. On the other hand, be prepared for the ‘final’ phase of a really good paper to take some time!
You can find the Brian Hey Prize winning papers at bit.ly/2y8I7dH
Brian Hey Prize guidance for authors is also available from the profession on request.
Joseph Lo is head of actuarial research and development at Aspen Re