Summary of Investment Management for Insurers

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Investment Management for Insurers book summary


6 Overall

7 Applicability

8 Innovation

3 Style


David F. Babbel, a professor of insurance and finance, and Frank. J. Fabozzi, a professor of finance, compiled Investment Management for Insurers, an extensive series of articles (including six they wrote) on managing investments. Various experts contributed the other two-dozen plus articles. The book, which is organized in sections based on major investment management topics, focuses first on general insurance issues, such as risk management and setting up a performance management system for insurers. Subsequent articles cover fixed income products, valuation, equity portfolio management and measuring and controlling interest rate risk. This highly technical book may not be sexy, but it is very sophisticated and fully accessorized with tables, charts, graphs, mathematical formulas and footnotes. Let’s be clear: it’s a book for pros, an in-depth compilation that recommends to professional and academic specialists in insurance investment management.

In this summary, you will learn

  • How insurance companies are valued, and how they maintain their value and manage risk;
  • How various securities and derivatives can contribute to an insurance company’s value and income;
  • How insurance firm experts manage equity and allocate assets, and
  • The latest thinking in insurance investment management.

About the Authors

David F. Babbel, a Professor of Insurance and Finance at the University of Pennsylvania’s Wharton School since 1985, previously taught at the University of California at Berkeley. He served as Vice President of Insurance and Pension at Goldman Sachs and was the Senior Economist at the World Bank. He has published extensively on insurance-related subjects. Frank J. Fabozzi, editor of the Journal of Portfolio Management, teaches finance at Yale University’s School of Management and previously taught at M.I.T. He consults on fixed-income investments and derivatives.



The Problem with Insurance Companies
The first insurance issue at hand is why dramatically more insurers have become insolvent in the last decade. The culprit is inadequate risk management. Thus, insurers are upgrading their financial risk management and control systems to reduce their...

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