Our work enables clients to make critical decisions about their insurance partners.
ALIRT analyzes the relative financial performance of insurers on behalf of insurance distributors, insurers, institutional buyers, and analysts to satisfy their risk management, due diligence, and marketing and research needs.
ALIRT’s services overcome the challenges of in-house research biases, data costs, and opaque public credit ratings providing its clients with arms-length expertise and due diligence on their insurance carrier counterparties.
What We Do
Every quarter, ALIRT collects publicly-available financial and market information/news on 1,000s of insurance companies.
This financial data is run through proprietary models which result in an in-depth ALIRT Analysis for each carrier. This Analysis – which generates a unique ALIRT Score – allows clients to make critical decisions about their insurance partners.
The individual ALIRT Analyses are embedded within customized reports and actively supported by ALIRT’s analytical staff.
Why We Do It
Traditionally, there were two principal ways that an interested party tracked the financial strength of insurance companies:
1. In House Research
Doing one’s own homework on insurance company financial performance is an optimal solution. However, many organizations lack the know-how, time, and funding to do this effectively.
2. Reliance on Public Ratings
Reliance on ratings has long been a way to track insurer financial performance that requires minimal time and effort. However, this strategy has several shortcomings, which include:
- Broad rating categories provide only a general sense of an insurer’s financial stability and are not regularly updated
- Ratings largely reflect the implied and expected support of an insurer’s parent organization
- Rating agencies are not designed to provide “hands-on” support to their subscribers.
ALIRT’s model overcomes the challenges of both options and in so doing, provides its clients with the best possible due diligence on their insurance company counterparties.
Our History
ALIRT focuses solely on the quantification and comparison of insurer risks for the due diligence and risk management of its institutional only clients. Few analytical teams, if any, have the long history of studying insurance markets and communicating the key performance indicators (KPI) and key risk indicators (KRI) that highlight insurance company financial trends to their clients.
Early 1990’s
ALIRT’s three principals work for Townsend & Schupp, a Hartford-based insurance research firm founded by two former Conning & Company principals to provide analytics to the GIC market as well as to financial institutions distributing insurance products.
1999
In October 1999, Dowling Risk Analysis, the predecessor company of ALIRT Insurance Research, is established in conjunction with a number of partner investors at Dowling & Partners Securities, an institutional insurance equity research boutique.
2006
In late 2006, ALIRT’s current management buys out the Dowling partners and renames the company ALIRT Insurance Research.
Present
ALIRT continues to embellish its models and services to meet the ongoing needs of is diverse institutional client base.With almost 25 years of expertise, broad access to industry decision makers, and high-touch service model, ALIRT serves as a vital link between insurers and the buyers and distributors of insurance products.
What sets us apart
It’s our unique philosophy and method in the analysis of insurer financial strength.
This philosophy is based on three core principles:
1. Legal Entity Focus
Analysis should focus primarily on the legal entity that actually issues the insurance or annuity contract and not an insurer’s parent (i.e. holding company). This approach reflects two basic facts:
- Generally, holding companies are not legally required to make good on their subsidiaries’ insurance or annuity contracts. Implicit support of these contracts always involves a “trust-me” factor.
- When insurance company subsidiaries are sold or spun off, the legal obligation to the insured almost always remains with the insurer underwriting the policy – and not the selling parent organization.
2. Regular and On-Going
Reliance on ratings has long been a way to track insurer financial performance that requires minimal time and effort. However, this strategy has several shortcomings, which include:
- Broad rating categories provide only a general sense of an insurer’s financial stability and are not regularly updated
- Ratings largely reflect the implied and expected support of an insurer’s parent organization
- Rating agencies are not designed to provide “hands-on” support to their subscribers.
Carrier financial oversight should be regular and on-going. No one can predict the future and given the vast number of variables impacting future financial performance, good due diligence should be continuous.
3. Quantifiable and Measurable
Analysis should be based on quantifiable financial metrics, embedded within a system that includes relative and absolute benchmarks for easy and accurate measurement.