Written by Risk.net
Moody’s Analytics offers an economic scenario generator and a suite of ESG solutions comprising leading-edge stochastic models, software modules and services. These enable insurers and other financial institutions to assess group-wide economic and regulatory capital needs, develop capital management strategies, and price complex embedded guarantees and options.
On the real-world modelling side, insurers and other investment focused firms can calibrate the ESG to reflect their own views for internal models, or use the Moody’s Analytics embedded standard calibrations as a starting point for their work or as an external validation of their views. The ability to reflect in-house views on risk-return characteristics, as well as the flexibility to model a range of assets and strategies, is also important to asset managers and investment advisory firms, where there is a growing trend to adopt ESGs for modelling.
On the market consistency side – where low and negative interest rate modelling continues to be a major requirement – Moody’s has helped clients transition to new interest rate models or approaches to calibration, such as using normal or absolute implied volatilities. Most clients are now using the Moody’s Analytics flagship Libor market model with the stochastic volatility (LMM+) interest rate model, although the firm also upgraded its ESG suite to offer a wide spectrum of calibration, automation and validation capabilities for simpler or short rate-based models.
Judges said:
“The most well-established and widely used ESG in the industry, with excellent client testimonials. Comprehensive offering; continuously developed and extended in terms of functionality and delivery.”
"Great product and service."
"The default choice in the insurance sector."
Colin Holmes, managing director of insurance solutions at Moody's Analytics, says:
“Moody's Analytics ESG solutions combine software, modelling and configuration in a comprehensive package to provide insurers with effective solutions for risk, capital and solvency management, reporting and financial modelling. Our ESG solution is widely used in the global insurance industry to support a range of risk management needs, from liability valuation and capital calculation to asset-liability management.”
