Manulife Financial: “The Worst is Over”
Despite losses in 2010, Manulife Financial CEO Donald Guloien told the Insurance & Investment Journal that the company believes the worst is over when it comes to risk management.
For example, according to their annual report, the insurer has reduced the $400 million impact that a 1% drop in interest rates would have had on earnings.
Plus, at the end of the year, the insurer took advantage of a rebound in the stock market to improve its hedging program. However, reported premiums and deposits of $65.1 billion in 2010 are $8.7 billion lower compared to the $71.3 billion reported in 2009.
Last year, Manulife also focused on better targeting its products — especially the more profitable ones — as well as further strengthening its reserves.
Finally, the company hopes to obtain a return of more than 14% on its key products and to stay away from products that generate less than that. Guloien outlined products with a lower return as those that expose the company to interest rate or market rate risk.