Rodney Hoskinson

Manager, Actuarial, QBE Insurance Group, Australia, Australian, 42

Could you tell us about your background?

I am a mathematics graduate of the University of Technology, Sydney, where I majored in statistics and was awarded the University Medal for Mathematics.

My first job was with an actuarial consultancy, then part of Towers Perrin, where I did pensions consulting. While working, I studied to become a fully qualified actuary and became a Fellow of the Institute of Actuaries of Australia. After a few years, I moved to an insurance actuarial consulting firm, now called Finity Consulting, where I specialised on pricing of insurance products and valuation of insurance liabilities.

I subsequently switched to the corporate side, first working for FAI Insurance for three years, and then joining my current employer, QBE Insurance Group, which is Australia’s largest international insurance and reinsurance group and one of the top twenty-five globally. Over the last twelve years at QBE, I have held various actuarial jobs for the company’s Australian operations. Some of the more interesting work I have done was to model economic capital and integrate this into capital budgeting decisions. QBE Insurance Group being quite acquisitive, I have been involved in the actuarial aspects of some of the Group’s acquisitions and corporate transactions. I also spent a couple of years as part of the product management team. Along the way, I studied to upgrade my actuarial skills and develop enterprise risk management expertise. This led to my earning the new CERA Global Association’s Chartered Enterprise Risk Analyst qualification last year. My study of quantitative risk management also sparked my interest for further work in the field of finance to complement my insurance and enterprise risk management profile. I contemplated doing an MSc in financial engineering or financial mathematics, but these would have offered few career opportunities outside of pure quant jobs, and instead decided to investigate doctoral qualifications.

Doctoral qualifications have a strong research component—why would a risk professional need this?

Research skills are key to approach and understand the rapidly evolving literature on risk. You need this kind of training to be able to tap the literature for ideas and techniques that can be used to improve your risk management practices.

Why did you choose EDHEC-Risk Institute’s PhD in Finance?

I looked at a few other institutions, but EDHEC-Risk Institute stood out because of its format, which makes it possible for executives to join, and for the outstanding quality and broad range of expertise of its faculty. Frankly speaking, there is no competition at the moment in this space.

I also valued the programme’s and the faculty’s openness to executives who want to further their knowledge and acquire new skills, and the profile of the class contributed to making the value proposition very attractive.

Initially, I feared the programme was more for investment banking or asset management professionals, but then I met and discussed the degree with Professor Rene Garcia, and realised it would be applicable to other sectors of the finance industry, and thus decided to apply.

What did you expect from the programme and has the programme lived up to your expectations to date?

I expected access to some of the top people in the field, which I consider is a key element for a doctoral qualification. The quality of the professors I have met this week is outstanding; their passion and their ability to explain complex concepts are telling signs that they are top-notch. The delivery is second to none and could not have been better in a traditional programme at another top university. While I have met only core faculty members so far, it is clear to me that the EDHEC team has strong networks!

I also expected to bring something home and found out that the material of the core courses has relevance to my job: corporate finance concepts, for example, could help me offer more to my employer when I work on mergers and acquisitions—interestingly, the company does this in-house. Beyond this, the knowledge gained from the course will help me when setting financial assumptions and making scenarios for my actuarial work. There are many areas where finance and insurance overlap (such as risk management and transfer, insurance investment and asset-liability management, corporate finance and governance in insurance); and it is all the more true for QBE, which also underwrites financial risk products such as mortgage and credit insurance.

Do you already know what areas you intend to research?

EDHEC-Risk Institute undertakes significant research on inflation, which is highly relevant to the pensions and insurance industries. I am very interested in the Institute’s new research initiatives on inflationindexed corporate bonds and inflation hedging. It’s still early for me to describe precisely what I will be working on in the dissertation stage, but these are areas with potential; it is sometimes overlooked, but property and casualty insurance liabilities are sensitive to inflation. The Group’s Chief Risk Officer and Chief Actuary, who have been very supportive of my participation in the programme, have shown much interest in inflation hedging in an asset-liability management context as an area for my future research work.

Another area of interest is the modelling of operational risk—the models currently in use are quite crude and some have suggested that a combination of Bayesian methods and networks, copulas, and graph theory be tapped to try to build more causal models of operational risk. Agent-based models may also have potential.

These areas would potentially relate to my current work environment.

With many other interesting topical areas of finance and financial risk management across the insurance and banking sectors at the moment, and the diverse expertise of EDHEC faculty, it’s going to be a difficult choice. I could head in a different direction.

What are your first impressions of the class?

This is a group of smart and talented people with diverse backgrounds and a broad range of experiences. It brings together very experienced people and very dynamic younger professionals. Class dynamics are good; everyone is comfortable asking questions and there have been a number of times already when one of my peers asked a question that really helped my understanding.

Who is this programme for?

It really is for professionals, across the financial services industry, who seek an in-depth understanding of finance as well as research expertise. It should appeal to those who are looking for an edge to help them bring new ideas into their organisations. You need a passion for self-development and decent mathematical aptitude, but you have some flexibility to make your PhD more or less theoretical or quantitative.

Are there things you would like to add about the School’s infrastructure?

For one, the online technology is excellent; it is great to be able to replay class sessions or attend presentations remotely. Thanks to the course notes and the technology (which synchronises the lecture video with the presentation slides), you are relieved from the pressure of note taking and it is easier to concentrate on understanding and participating while in class. It should prove very useful to absorb the material and prepare for comprehensive examinations as well as to keep in touch with the class between residential sessions.

The Singapore executive campus is brand new and comfortable, but I am also looking forward to visiting the Nice campus. Nice holds a special place in my memory as I proposed to my wife Lisa on a Nice vacation. She indicated she was much in favour of my taking an elective seminar there and hinted she would come along. Another holiday there is the very least she deserves after putting up with my significant commitment to studies and research!