Pooja Rahman won chief risk officer of the year in InsuranceERM's 2023 annual Americas awards. She tells Ronan McCaughey how her risk team at Protective Life Corporation adds value, as well as discussing artificial intelligence and ChatGPT
Protective Life Corporation's chief risk officer (CRO) Pooja Rahman is a keen walker and she's walking on sunshine – just like the 1980's song – after winning InsuranceERM's CRO of the year Americas award.
Rahman has been in the CRO role at Protective for two years. Having inherited a very strong team, she says the life insurer has since built up investment and market risk expertise within the company, as well as investing in risk analytics to produce more rapidly available data.
The next step in the team's growth will shortly involve onboarding a new head of technology and data risk after Rahman spent over a year searching the market for the right person.
Rahman explains that her role as CRO and that of the risk team is to set, evolve and implement the company's strategic risk appetite (SRA). She says: "Our risk appetite essentially sets the boundaries for the company. The business plan is constantly tested against the SRA. Our SRA is expected to position us for both organic and opportunistic growth, while minimising unknowns as best possible."
Opportunistic growth at Protective often involves M&A, and the risk team plays its part in advising on potential targets and the subsequent integration processes.
"If you look back to 2017, Protective's balance sheet has grown notably by acquisitions, and that is something we continue to look at and be involved in from a due diligence perspective. It is a model we continue to pursue, but we also need to stay appropriately focused on operational elements and how we are integrating new businesses into the Protective brand, book, and operations."
"A shorter-term recession, although I won't be happy about it, is something we should all be prepared for"
She adds that the risk function reviews any M&A bids and provides a risk report to Protective's board of directors, as well as Dai-ichi, the Japanese insurance holding company that acquired Protective in 2015.
Internationally, Rahman explains that the group company is moving towards an economic solvency ratio and using the global Insurance Capital Standard as its yardstick. "The risk team, supported by the finance function, has been at the forefront of those engagements with Dai-ichi on what our internal capital construct for the US business should look like."
Building a stimulating learning environment and risk culture is important to Rahman. She says: "I like positioning my leaders for growth and throwing more at them because I have always appreciated environments where more was expected of me. That is how I have grown up."
Macroeconomic risks
Commenting on the risks in the US life insurance market, Rahman highlights the country's debt-ceiling crisis. Speaking before the issue was resolved, she notes how it created liquidity risks for insurers in the short term. "But over the long term, the notion that the US would not come through on its obligations is something you cannot plan for," she adds.
"There is also inflation and the rapid rise of interest rates. Insurers like rates to rise, but in a nice and slow way. We want to see inflation come under control and there are some good signs on this."
Read about all the other winners in the InsuranceERM Americas Awards 2023
In her view, another risk is the banking crisis blows out of proportion, causing the Federal Reserve to cut rates dramatically again to get a recession under control. She adds: "A shorter-term recession, although I won't be happy about it, is something we should all be prepared for."
Rahman explains two things give her confidence that Protective can weather such events: the first is Protective's agile operational model; and secondly, knowing the company's strengths and space. "We are very aware of the difference between private insurers and public insurers, whether they are directly public or owned by a public company like us."
ChatGPT's impact
Developments in artificial intelligence, such as ChatGPT, is another topic insurers and CROs are keenly watching. And this includes Rahman who says Protective is in the camp of cautious engagement with ChatGPT.
"I have people in the risk team that are playing with ChatGPT for research"
"My own mindset is not anti-AI. We are in a cautious learning phase about AI. We think it can serve a purpose, but excessively relying on AI can be a big risk as it is not always reliable or authenticated. We see the promise, but we also see the risks."
She adds: "I have people in the risk team that are playing with ChatGPT for research. We do not have the tool open on the official system and we certainly would not want the risk department to be breaking the rules. But there is curiosity within the risk area about what it can do."
Personal background
Born and raised in Mumbai, Rahman achieved a degree in accounting, and came to the US in 1997. She says: "When I was wrapping up my MBA, an insurance company was recruiting on campus. That took me to the Des Moines metro area, which I called home for 13 years. You could say I fell into the insurance space, and I stayed, so something worked."
She adds: "I went to law school and was also a practising corporate lawyer for Aviva towards the initial part of my career. My route to being a CRO was influenced by observing people in the industry and people I worked for.
"I am a walker. I walk at least 60-80 minutes every day"
"Almost any role I have taken on so far has involved observing someone who is doing something impactful really well, getting a good dose of inspiration, and a voice that sometimes ends up saying 'I could learn to do that, and I could do that well'."
The sheer diversity of the CRO role is what Rahman enjoys most about her job. "One day of the week you are heavily engaged on something with the chief financial officer, another day it is with the chief investment officer, and the next day it is with the chief operations officer. However, some days what I like least is also the inability to deep dive into a tier."
Early riser
As a morning person, Rahman says she often rises around 4am. "I wake up early and try to get caught up on home and work tasks because you are in meetings during the day."
"Meetings, with the team and with peers, are critical. But I also need some time to get my own thinking organised, respond to emails, and to get initiatives ready for engagement."
Given her busy schedule, I ask Rahman how she relaxes away from work. She comments: "I am a walker. I walk at least 60-80 minutes every day and I am messed up if I don't. So, I like to walk, and I commit to it, and I get it done. If it is really bad weather, I will walk indoors. I usually like to walk alone as it is my me time."
The CRO also enjoys travelling with her family and enjoys cooking all types of cuisine.
Asked where she sees herself in five years' time, Rahman says: "Adding value, I hope. In five years, I will likely say I am on track if I continue to learn more, influence more successful outcomes, and have a bigger impact."