Frequently Asked Questions

 

1. What is the history of Peer Analytics?

The principals of Peer Analytics: David Newsom and Michael Kantor have worked together for the past fifteen years. Prior to founding Peer Analytics in 1999, they were both senior members of the research group at SEI Corp., one of the country’s largest institutional investment consulting companies. Each with over 25 years in the investment-consulting field each, they boast a proven and experienced track record within the insurance industry.

 

2. What is the PeerTrac Benchmarking service?

A proprietary insurer specific database that includes in-depth investment return and portfolio structure data for over 400 Property Casualty and 300 Life Health companies. This allows us to compare your return data with not only the total industry results, but also with any specific group of peers / competitors that you define. 

 

3. Who are some of Peer Analytics’ clients?

For a partial list of clients click here

 

4. Is the peer group based on participating companies?

No, the peer group is chosen from our proprietary database of either Property Casualty, Life or Health insurers. You may choose the members or define the selection criteria of your peer group that is most meaningful to your organization.

 

5. How is the database compiled?

Peer Analytics begins with security level holdings and transaction data obtained from Schedule D of the NAIC filings. We then employ Peer Analytics' proprietary methodology using internally developed algorithms to derive accurate market value and total return information. Our calculations are then reconciled with data submitted by participating companies.

 

6. What if we have a very high equity allocation and as a result have no "peers"?

There is competition within the insurance industry. Your competitors are your peers for the purpose of evaluating your investment performance and strategy. Also, regardless of your portfolio's equity allocation, it is important to know how your active equity and fixed income managers have performed under the unique investment constraints that similar insurers face. 

 

7. What if we write a unique type of insurance and as a result have no competition?

If you truly have no competition, a portion of the value of our report is not applicable. However, you do invest substantial assets and devote significant resources to implement your investment program. The most meaningful method of evaluating the contribution of your investment managers is to compare them to other managers with similar investment constraints (taxes, regulatory and rating agency).

 

8. What if we already receive this information? 

Initially, many of our existing clients suggested the same. After review, however, it became clear that they had targeted only one aspect of peer analysis. Our analysis is very comprehensive and is valuable on several levels. For example, you may know how your equity allocation compares to that of your peers as this information is available. But, do you know what this translates to each year in Total fund return? Or, how your equity portfolio performance compares to the equity returns of these identified peers?

Uniquely, our reports accurately answer theseand many other pertinent questions.

 

9. What resources do we need to commit for participation?

We prefer to obtain the following data from you:

2001-2006 annual returns for:

  • Equity
  • Tax-exempt, Taxable, and Total Fixed Income
  • Total Portfolio

Fixed income portfolio duration as of year-end 2005 and 2006, and portfolio maturity for
year-end 2004 – 2006

Monthly or quarterly equity returns for the last five years, if possible*

*If any of the above data is unavailable, we will supplement with our calculations.

 

10. How long will it take to receive our first report?

Normally it takes 7~10 days. However, if required, we can electronically transmit the report to you within 3 days.

Effective benchmarking provides sufficient information to determine when corrective action is necessary.

Indexes are valuable components of the benchmarking process, but by themselves are not sufficient. Simple index comparisons lack the context required to draw meaningful conclusions.

Because indexes provide only a single comparative data point for each time period, it takes decades* to determine with any statistical meaning whether or not an investment manager has positive or negative skill. So by the time you have enough data to reach a conclusion, it's far too late.