RiskTech Forum

IBM: Legal & General Takes A Sophisticated Approach To Capital Modelling

Posted: 20 May 2014  |  Source: IBM - Risk Analytics


The need
With Solvency II on the horizon, Legal & General needed a risk modelling solution to calculate its capital requirements. The company saw this as an opportunity to gain deeper insight into risk across its business.

The solution
Legal & General used the IBM® Algorithmics® Economic Capital, Enterprise Risk Management and Solvency II solution to enable a simulation-based approach for determining solvency capital, modelling each asset individually and using curvefitting techniques to model liabilities.

The benefit
A simulation-based approach for capital modelling can often produce lower capital requirements than a factor-based approach, and enables better decisionmaking with greater visibility of risk at different levels within the organisation.
The IBM solution supports multiple types of risk modelling with a single standardised platform.

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