This overview is meant to broadly summarize the ESG movement to date and provide insurance company and risk pooling Board Members and Executive Staff a blueprint for conversation as well as considerations for implementation.

Most risk pools utilize GASB accounting and therefore the fall in bond prices has had a significant impact on surplus. For the long term health of the surplus of the pool, it is important that those losses do not become realized in a significant way. Ultimately, by holding the securities, they will mature and the unrealized losses will evaporate.

Our updated Pool Peer Group (Q3), includes a newly added comparison: Book Yield to Duration.

 

Duration measures the sensitivity of a bond's price relative to interest rate changes. Book Yield indicates the raw earnings power of the portfolio, which is especially important to a risk pool's financial statements and pools that mark-to-market.

As a resource for your organization, we've compared fixed income investment management fees, across various portfolio sizes, among managers in the insurance and risk pooling space.

Given the growing concern over succession issues and Board of Trustees turnover within the Pooling community, we developed a primer to help Trustees understand and review their role within the pool’s investment operations.

As your government risk pool reviews the investment portfolio with your investment manager, asking key questions can help your staff, Board and Investment Committee better understand the overall process.

To help risk pools better understand the components of a quality investment policy statement, we’ve provided an overview of Investment Policy “Best Practices.”