FCAS, MAAA
Principal and Consulting Actuary

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Derek W. Freihaut

Derek Freihaut is a Principal and Consulting Actuary with Pinnacle Actuarial Resources, Inc. in the Bloomington, Illinois office. He holds a Bachelor’s Degree in Mathematics and Economics from Rose-Hulman Institute of Technology in Terre Haute, Indiana. He has been in the property/casualty insurance industry since 2002.

Mr. Freihaut has considerable experience in assignments involving loss reserving, funding studies, loss cost projections, captive feasibility studies, risk transfer analyses, and personal and commercial lines ratemaking. He currently serves as vice chair on the AAA Committee on Property-Liability Financial Reporting (COPLFR).

Prior to joining Pinnacle, Mr. Freihaut was employed at a large insurance company where his responsibilities included personal and commercial lines pricing. His pricing duties included private passenger and commercial auto, commercial multi-peril, and rental program lines of business.

Publications and Media

November 2019 APEX
State of the Florida Homeowners Market
Authored by Derek W. Freihaut.

Expected Adverse Deviation as a Measure of Risk Distribution
EAD as a Measure of Risk Distribution - *Sign in required to view*
Authored by Derek W. Freihaut and Robert J. Walling III.

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Case Studies

Audit Support & Risk Transfer

Audit Support & Risk Transfer

Pinnacle provides audit support for captive insurers to a major accounting/audit firm. The audit support typically includes a review of the actuarial report and supporting documents to determine if the actuarial report adheres to professional standards and provides a reasonable estimate of held reserves. As part of this support we interact with the actuaries who developed the report in order to answer any relevant questions. Another frequent element of audit support engagements is risk transfer analysis. Pinnacle has developed a state-of-the-art approach to risk transfer modeling; our publications and presentations at industry trade shows have been well received. Ultimately, Pinnacle produces a report with relevant comments and our conclusions that provide the necessary documentation for the auditing firm.

Medical Malpractice Damage Caps

Medical Malpractice Damage Caps

A state insurance regulator asked Pinnacle to determine the potential impact of several proposed tort reforms, including a change to non-economic damage caps for medical professional liability claims. Pinnacle worked with medical society to identify the most appropriate claims databases for assessing the potential legislative change. Our detailed analysis not only considered data from that state, but several others to stress test the results and provide a range of reasonable outcomes. In many cases, the specific reform’s effect, for example “I’m Sorry” legislation, was very difficult to isolate. Through this industry analysis, we identified differences well beyond a simple loss limitation to provide a more complete review of potential environmental changes that could be expected in the state.

This comprehensive analysis helped our client identify the effect of various legislative options, which empowered them to be a strong voice in the legislative debate and to influence policymaking in the state.

Risk Management Assessment

Risk Management Assessment

Pinnacle was asked by a state department of corrections to provide a comprehensive, independent review of the adequacy of their property and casualty insurance plan. The independent insurance plan review was necessary for compliance purposes with state insurance regulators. The facility had even stricter self-imposed standards for their insurance plan. It was Pinnacle’s job to review the guidelines for reasonableness and appropriateness as part of an overall risk management strategy. Pinnacle reviewed and adhered to the state code as well as the additional standards provided by the facility. Moving through each line of insurance coverage, Pinnacle offered recommendations and approval notations. The result was an increased level of risk control for the facility, and subsequently led to a follow up review by Pinnacle at the next required consultation.

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