At the 2014 NABRICO Conference, held September 17-19, 2014, Mike Kelch, CFA, AAM Senior Portfolio Manager and Dan Byrnes, CFA, AAM Senior Portfolio Manager both spoke to separate sessions of conference attendees: insurance company professionals whose companies provide attorneys across the United States and Canada with professional liability insurance.
Mike Kelch, along with Alan Fine, CPA, JD from Brown, Smith, Wallace, LLC, presented on the topic of “Tax Modeling: Considerations for Effectively Implementing Trades Between Taxable and Tax-Exempt.” Mike focused on the process for determining a tax-exempt allocation and other considerations for insurers when thinking about tax issues. AAM’s proprietary tax model was covered as a useful tool to help determine an appropriate allocation and how underwriting profitability can influence an insurer’s tax-exempt allocation. Relative value of tax-exempt versus taxable securities was discussed as well as various technical drivers within the tax-exempt market. Alan covered Alternative Minimum Tax (AMT) implications, Other-Than-Temporary-Impairment (OTTI), and master limited partnerships (MLPs) as additional topics relevant to insurers when think about tax issues.
Dan Byrnes, CFA, Senior Portfolio Manager, spoke about “Investment Considerations for Insurance Companies in the Current Market Environment.” He began his presentation by focusing on considerations for developing an appropriate investment strategy, including determining the goals of the portfolio, investment policy construction and appropriate levels of various investment risks. Then he discussed other Enterprise Risk Management tools and processes insurance companies should consider adopting. Finally, he closed with a discussion of Federal Reserve monetary policy, relative value in the fixed income market and the outlook for various risk assets in a rising interest rate environment.
In addition to having two speakers, AAM was a Silver Sponsor and attended the conference.