Insurance Company Financial Modeling

New York Institute of Finance, in conjunction with Wall Street Training, present the following course:

Build a fully integrated, scalable, new insurance company model including detailed build-up by line of business from gross written premiums to net premiums down to underwriting income. Consolidate the lines of business performance into a GAAP income statement with statutory adjustments. Integrate income statement projections with a self-balancing balance sheet, an automated cash flow statement and the balance cash flow sweep schedule.

No sessions currently available. Contact client services to get the next available date.
Insurance Company / insurance broker management and professionals. FIG (Financial Institutions Group) or Insurance Investment bankers, mergers & acquisitions, leveraged finance and credit professionals. Controller, Accounting, Internal Audit and reporting roles. Internal M&A and business development. CFO, VP Finance, Financial Analysts, & related functions. New hires and those being groomed for management.
No advance preparation required.
Students will be able to:
  • Build an integrated set of financials, including LOB, income statement, balance sheet and cash flow
  • Project direct, ceded and net premiums and underwriting income based on assumed loss triangles
  • Consolidate multiple lines of businesses, calculate GAAP and stat net income with tax schedule
  • Project self-balancing balance sheet including items such as premiums receivable and recoverables
Proficiency in: Accounting & Financial Statements, basic Corporate Finance and valuation topics. Basic, general knowledge or interest in insurance, insurance jargon and terminology or insurance operations. Solid proficiency in Excel. Note: To maximize the value & productivity of this course, participants must be proficient and confortable with Excel - a lack of Excel skills will hamper the ability to properly follow along and acquire the best practices and efficiencies that are presented.
  • Financial Analysis of Insurance Companies
    • COMPUTER
    EVERY PARTICIPANT MUST BRING THEIR OWN LAPTOP TO CLASS
    Day 1

    Line of business breakdown

    • Project gross written and earned premiums
    • Calculate loss and LAE and reserves
    • Estimate quota share and XOL amounts
    • Generate net premiums, losses, commission expenses and underwriting income
    • Consolidate multiple lines of business into consolidating income statement

    Day 2

    Income statement

    • Calculate all revenue items including premiums and investment income
    • Calculate total expenses including underwriting expenses and other relevant expenses
    • Tax schedule to properly adjust for deferred acquisition costs (DAC) and any NOLs
    • Adjust from GAAP net income to estimated statutory net income

    Balance sheet

    • Project cash and invested assets balances
    • Project premiums receivable, reinsurance recoverables and other relevant insurance assets
    • Derive loss reserves, unearned premium reserves, and other relevant insurance liabilities
    • Project shareholders' equity account including APIC, retained earnings, etc.

    Day 3

    Cash flow statement and sweep

    • Calculate CFO (including working capital), CFI and CFF
    • Build cash flow sweep to capture any shortfalls/build-up in cash to balance the entire model
    • Build interest schedule to fully integrate the model
    • What are circular references, why should they be avoided and how to get around circular references

    Internal rate of return (IRR)

    • Project returns to financial sponsor/investor based on financial model

    Clients who register for this course will receive a complimentary 6 month subscription to the Financial Times and FT.com. The Financial Times is the world's most respected financial newspaper providing a broad assessment on finance, business and the industrial sector. Subscriptions will start within 6-8 weeks of the application process, and are limited to one per client. For questions about your subscriptions call 800-628-8088 or email uscirculation@ft.com. US and Canada enrollees only.

    Lunch included for all students taking day classes.