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1415 28th Street, Suite 200
West Des Moines, IA 50266
Phone: (515) 543-8400
Toll Free: (800) 343-7084
inforequest@miles-capital.com

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DISCLOSURES: The information provided herein is furnished by Miles Capital, Inc. solely for informational purposes and is confidential. It may not be reproduced or distributed to anyone else without prior consent. This document contains the current views of Miles Capital and is not intended to be, and should not be interpreted as, a recommendation of a particular security, product, or investment strategy. Such opinions and predictions are subject to change without notice. The strategies described in the presentation may not be suitable for all investors. There is no assurance that any of the objectives described will be achieved. This information contained herein does not take into account the particular investment objectives or financial circumstances of any specific person or entity who may receive it. You should consult your tax or legal advisor before making an investment, and investors are advised to thoroughly and carefully review financial, legal, and tax consequences of all investments to determine suitability. Investments in alternative assets may be illiquid and present significant risks. Past performance is not a guarantee of future results. There can be no guarantee that any investment strategy discussed in this Presentation will achieve its investment objectives. As with all strategies, there is a risk of loss of all or a portion of the amount invested. Diversification does not ensure a profit or protect against market loss.

Why Objectives-Based Asset Allocation® Matters for Insurers



In today’s complex environment, insurance companies need to evaluate whether their investment portfolio is prepared for both today and tomorrow — or whether it simply exists.


We believe insurers should expect more from their asset allocation. Done correctly, an insurer’s portfolio should be constructed with a full understanding of the company’s profile and objectives. It should also include meaningful targets that fully align with the company’s priorities.


Over our more than three decades working with insurers, we have developed a different methodology: Objectives-Based Asset Allocation®, or OBAA®. Unlike traditional asset allocation, OBAA® is based on addressing the critical needs of all insurers and helping them to achieve their business objectives.


It moves asset-class optimization to the correct place in the process, after these objectives are considered. The end result is a solution that helps directly align the portfolio with your business.


A Stronger Solution


OBAA® is built on Miles Capital’s 30 years of managing insurance company portfolios. It is unique in that it both aligns the investment portfolio with critical company priorities and provides forward-looking analysis to help ensure market challenges are met. Key features of OBAA®:

Directly incorporates all insurance company characteristics.Seeks to structure the investment portfolio to optimize the business objectives of the insurer.Provides each insurance company client with a forward-looking, multi-year analysis that supports strategic decision making.Addresses the four fundamental investment needs shared by all insurance companies.Considers over 30 different asset classes, ensuring breadth of inclusion.Dynamically incorporates updated market and company data in order to ensure proactive portfolio construction.Produces a library of analytics illustrating the effectiveness of the asset allocation to be used for direct compare-and-contrast analysis.


Strategic Alignment


OBAA(R), by design, helps ensure that the investment portfolio is strategically aligned with the business objectives of the insurer and provides forward-looking insights to help meet market challenges. This isn’t always the case with traditional asset allocation.


For example, an insurer’s investment portfolio, under traditional asset-allocation methods, may be designed to meet a standard deviation or risk measure of 4 percent. But what does 4 percent volatility mean for earnings growth or net investment income? What does it mean for capital efficiency or your rating? Targeting a specific standard deviation may not support surplus growth or maintain the liquidity necessary for an insurer.


Insurers need to be able to prepare for and react to major events as well. Our process examines how a company’s objectives are affected by these types of market dynamics, and we can help a CFO understand the potential for portfolio success in a difficult underwriting and/or market year.

Insurers have unique needs and should demand more from their asset allocation. We believe OBAA® can help deliver a portfolio with true direction.

Disclosures
 

The views expressed herein are the current views of Miles Capital as the stated date and are provided for informational purposes only. They are believed to be correct, but accuracy and completeness cannot be guaranteed and should not be relied upon for legal or investment decision purposes. All expressions of opinion and predictions presented are subject to change without notice. Neither the information presented nor any opinion expressed constitutes a solicitation for the purchase or sale of any security. Past performance is not a guarantee of future results. Diversification does not ensure a profit or protect against market loss. As with all strategies, there is a risk of loss or all or a portion of the amount invested.