How insurance risk is transformed into investable assets
Insurance risk involves the sale of insurance policies to policyholders, the receipt of premium and the payment of claims. If claims & associated expenses are less than premium received, an Underwriting Profit is made. If claims are greater than premium, an Underwriting Loss occurs. In essence, investing in insurance risk is like partnering with an insurer — you share in the results of the portfolio, keeping a slice of the underwriting profit if claims come in below premiums, or sustaining a los