Hannover Res Bo Jiang helps take RISC online in 2020

For Bo Jiang, the most memorable moment of doing ANZIIF’s Reinsurance International Study Course (RISC) in 2010 as a fledgling actuary, was the realisation that he needed to broaden his view instead of just focusing on price.

A HOLISTIC VIEW

‘I learned that to thrive in the business of reinsurance, one also needs to know how to make decisions on reinsurance structures and what the associated implications will be,’ Jiang says.

‘An understanding and appreciation of all the moving pieces is required, including pricing, underwriting, broking, capital implications, global trends and alternative capital solutions.’

PACKED WITH INFORMATION

Jiang, who is currently a Casualty Treaty Underwriter with Hannover Re recalls that initially, the course seemed overwhelming.

It was packed with technical information and the thought that the trainee ‘syndicate’ group had to deliver a presentation on a fictional case study within three days was stressful.

However, once getting started, Jiang found the course materials well-structured and the process clear.

‘The syndicate advisors are knowledgeable and experienced. They patiently provided guidance to the syndicate group throughout the course.

‘At that time, I thought it would be great if I could become a syndicate leader one day,’ he says.

RISC REIMAGINED 

While RISC is usually delivered in a posh location over three days, the impact of COVID-19 has seen the iconic course restructured for online over a three-week period.

‘I think the online course is a new norm,’ Jiang says.

‘Although one may argue it does not provide in-person interaction like it used to, it might be how things could be for a while.’ says.  

‘We all need to try harder to be active in digital groups for work and socialising.’

LEARN AT YOUR OWN PACE

One of the key advantages of the online delivery is flexibility.

‘The course is designed to spread over a few weeks rather than packed into three days.

‘People learn differently, so the new online course will allow participants to digest and internalise the material at their own pace.

‘It also provides options for people who were naturally lone learners.

‘In a physical setting, the pressure to participate for people not comfortable with it could impact the learning experience and even interfere with the learning outcome.

‘The digital platform allows people to gradually involve themselves at their own pace.’

INSPIRED BY REINSURANCE

Bo Jiang was born and raised in Tianjin, China — a city roughly 120 kilometres southeast of Beijing, famous for a port explosion in 2015 that cost the (re)insurance industry billions.

Jiang studied an actuarial degree in university having been told that actuaries use maths in the financial industry.

‘I thought, I’m okay with maths, I could give it a go.’

In his last year of university, Jiang was inspired by a visiting lecture who worked in reinsurance.

‘I found reinsurance concepts fascinating, especially considering the challenges for actuaries when there is only limited data available to assess extreme risks.

‘A lot of it will come down to actuarial judgement and professional experience.’

STEEP LEARNING CURVE

Due to the Global Financial Crisis, Jiang couldn’t get a job in insurance after graduation.

Instead, he worked for two years in financial modelling for infrastructure projects before an opportunity came up in 2010.

‘Job vacancies in reinsurance could be sparse — people generally didn’t leave the industry often and new roles were rarely created,’ he recalls.

‘When I saw the opportunity in 2010, I submitted my resume straight away.’

Jiang’s first job as a pricing actuary in Willis Re Australia saw him working ‘with many intelligent people’ on clients’ reinsurance renewal and pricing.

‘It was a very steep learning curve initially and it was enjoyable,’ he tells.

UNDERSTANDING ASIA

In 2013, Jiang moved to China for family reasons and took a similar role with Guy Carpenter, working with clients in the Greater China market.

‘It was a fantastic experience to see how different the Asian (re)insurance market can be,’ he says.

‘The volume of work and fast pace deepened my reinsurance knowledge across all areas, whether it was property versus casualty, proportional versus non-proportional, or per risk versus catastrophe treaties.’

A NEW ADVENTURE

While the transition to treaty underwriting was a natural career progression, Jiang admits he was also seeking a new adventure.

‘When I returned to Willis Re Australia in late 2014, I started to think I should look beyond being an actuary,’ he recalls.

‘My feeling was that pricing work had become a little repetitive and not close enough to the business.’

Jiang undertook an MBA to explore his options and started venturing into client management, building new business capabilities in life reinsurance broking and getting involved in internal strategy projects.

‘I’m glad the self-exploration worked,’ he says.

‘I realised that I love performing the analytics work, but I also like engaging with people, looking at the bigger picture and thinking outside of the box.

‘I saw a treaty underwriting role that ticked all these boxes, so I moved on.’

MARKET FINESSE

Jiang says there has never been a more important time to develop knowledge and experience of the reinsurance sector.

‘In my view, there has been a soft market in Australia for a long time,’ he observes.

‘For some classes, the rate reductions in past years can be associated with relatively benign loss activities.

‘However, for other classes, rate reductions are more driven by an oversupply of (re)insurance capital.’

THE COVID DYNAMIC

Now, as we all know, COVID-19 brought in a very different dynamic.

‘World economies have been hit, and the capital market is facing low investment returns.

‘Human activities and behaviours are very different compared to what they were before the virus.

‘The (re)insurance market has started to react, either directly or indirectly.’

With mergers and acquisitions prior to the pandemic already having changed the landscape of the industry, Jiang predicts that the capital markets will look closely at the insurance sector.

‘Reinsurance pricing and coverage will continue to move with the direct market,’ he says.

‘That being said, there may be further price increases or tightening of coverage as reinsurers take on more extreme risks than their cedants.’

EMERGING PRODUCTS

On the more positive side, Jiang expects to see an acceleration of emerging (re)insurance product development, such as pandemic coverage.

‘It’s sometimes a challenge to visualise extreme downside scenarios, however the current global pandemic is allowing us to think about what we should do to future-proof the industry,’ he says.

‘In addition to providing capital, reinsurers have been providing crucial input to, or even leading, product development.

‘For instance, it makes more sense to explore pandemic covers related to communicable diseases, considering that many treaties may start to exclude this kind of cover.’

EXCITING TIMES

Jiang says there is also a great opportunity to think about traditional versus alternative reinsurance solutions.

‘Whether it is structured risk transfer, Insurance-Linked Securities (ILS), catastrophe bonds, or other forms, alternative reinsurance would be a great complement to the traditional solutions.

‘I can see things will move faster, and it should be an exciting time ahead for the reinsurance underwriters.’

PROUD TO CONTRIBUTE

Despite an eminent career, Jiang says the achievement he is most proud of is being involved in RISC as a committee member and syndicate advisor.

‘It is such recognition to have to the opportunity of working with many industry leaders in a course that has more than 50 years of history,’ he enthuses.

‘I also think it is an honour to be able to give back to the insurance industry, especially in the form of education. I couldn’t be happier to share my knowledge and experience with the candidates of the course.’

EXCELLENT INTRODUCTION

He adds that RISC provides an excellent introduction to reinsurance.

‘Reinsurance is fun — it brings underwriting to a whole new level beyond individual risk selection and portfolio management,’ he says.

‘It also looks at the bigger picture such as capital implications and longer-term relationships.

‘There are many opportunities and many new things you could work on in the reinsurance world.’

OPENING CONVERSATIONS

He advises participants to keep conversations open.

‘Grow your network, even beyond the course — reinsurance is about the relationships, both personal and technical.

‘Either way, it is about networking and developing an understanding of the industry from a people perspective.

‘Many of us have been working with each other, as colleagues, clients, service providers, or competitors. Nevertheless, the network is always developing.’

A WELCOME REFRESHER

He also recommends that repeat to RISC attendees at any stage of their career refresh their knowledge.

‘Like any other kinds of training, you need to practice before the knowledge fades away. This year, the online course will work great as a refresher.’