Moody’s Investors Service is seeking feedback by June 21, 2021 from market participants on the proposed introduction of Moody’s Capital Tool (MCT), a proprietary stochastic tool which will complement our analysis of insurance companies’ risks and capital. MCT may inform our assessment of capital adequacy where appropriate.
The proposed change reflects the increasing use of market consistent models by regulators and insurance companies themselves to assess solvency and capital, and Moody’s acknowledgment that such metrics can represent an insightful addition to our existing credit analysis of insurance companies. MCT aims to perform a globally consistent quantification of the typical sources of risk that a property and casualty (P&C) or life insurance entity faces and to gauge the adequacy of its resources for covering those risks.
We expect to use the tool to analyze P&C companies in the Americas, Asia-Pacific and Europe and for many products underwritten by life insurance companies in the US, Asia-Pacific and Europe. We also expect to expand its use to more countries and products over time.
SPEAKERS
From the Financial Institutions Group:
Sally Yim, Managing Director
Benjamin Serra, Senior Vice President
Frank Yuen, Vice President - Senior Analyst
