2013 The outlook for insurance Didier LAMBERT Head of Product Management Solife, BSB 5 June 2013
Agenda 1. Industry trends 2. BSB s solutions portfolio 3. Solife: Recent developments and outlook
PAGE DE TRANSITION Industry trends Slide 3
Trends A lot is happening... The European market is still struggling New markets are doing well and are expanding Important legal evolutions are having an important impact on market & organisational models The product mix is evolving rapidly Many companies just stopped doing... now that is changing. A growing understanding that covering the entire value chain is not the only solution 4
Trends Major trend 1 : Cost reduction Environment Numerous Closed Books due to changed market conditions Many companies have multiple administration systems The crisis is ongoing Markets are contracting due to uncertainty and changing conditions Strategy A contracting market needs a different strategy than a growth market. Get organized for cost efficiency not for growth Solutions Outsource elements of the value chain : BPO SaaS sometimes combined with a growth element => Cost Reduction + Model 5
Trends Major trend 2 : Shifts in the product mix Protection products Guaranteed products More unit-linked business (lifetime investing) Less interest in insurance products with a low guarantee Even traditional markets for guaranteed products e.g. France are shifting to Euro Diversifié Revival of Protection Upturn in unit-linked activity Return of the VA business 6
Trends Major trend 3 : Changes in distribution models Direct to consumer Tied networks External players Front Start Finish Process integration Underwriter Call center Back-office operator Finance Back-office 7
Trends New Distribution Model => A new journey for insurance 8
PAGE DE TRANSITION BSB s solutions portfolio Slide 9
Solutions from BSB A leading administration system Liability management enabling: Agility Operational efficiency Modularity Standard preembedded front-end Or Personalized portal Asset management : Institutional management (own assets) Wrap insurance products SaaS & ITO features are ideal for companies seeking Variable costing A Closed Books solution 10
BSB s solution for Insurance Recent contract: GlobalCapital Malte GlobalCapital will use : Solife to run every aspect of its life insurance activity, from distribution via the web front-end (esolife) through to claims management. Soliam to manage its investment and wealth management activities Soliam to manage its insurance linked funds 11
BSB s solution for Insurance Recent contract: AG Insurance AG Insurance is the largest insurance company in Belgium (market share of 27% for life & health insurance) Use of claims module to manage healthcare and disability claims Important focus on : - High operational efficiency (full automation / STP principles) - Business rules flexibility (complex & multi-contextual product/rule logic) - Modularity of the solution (connecting to multiple custom policy administration systems) 12
BSB s solution for Insurance Recent contract: Sberbank Insurance Sberbank is the largest bank in Russia and CIS (e.g. 45.7% of Russian retail deposits and 20,000 branches). Sberbank Insurance ambitions to exploit the distribution power of the group to have the same level of market dominance in the insurance business Sberbank Insurance will use Solife as its policy administration system to run every aspect of its life insurance activity (individual and group). 13
The Solife differentiators Creating a new paradigm in insurance management Rich Out of the box solution ADOPT Configuration power (scripting, dynamic data management) Flow-based model Fee & Tax workbench Investment strategies Modern HTML5 preembedded portal solution ESB, web services, extraction workbench Within a global migration framework 14
BSB s solution for Insurance 15
BSB s solution for Insurance Soliam key added-value Empowers Decision Makers With Key Indicators & Trade Controls High Quality Reporting Improves Operational Margins Scalable Processes featuring Automated Workflows for orders, settlement, end-of-period accounting closings, etc. Provides Superior User Experience through Technology RIA, Web Services, Client & IFA/EAM Portals, etc. Provides Comprehensive Functionalities Portfolio Management, Compliance, Performance etc. 16
BSB s solution for Insurance Case study Why BSB? Excellent cost/benefit of BSB proposal (TCO Optimization) Soliam is now used by 3 of the 5 largest Belgian insurers Added value of Soliam data warehouse module for stable and readily available information Project description Go-live in 2011 for reporting purposes Reasons for change? Total Cost of Ownership (TCO) optimization Need for flexible and reliable management and commercial reporting Need for full Straight Through Processing to streamline the financial AM processes Second phase live in 02 2012 including automated SWIFT and Bloomberg interfaces and multistandard accounting Operational risk has been significantly reduced (Solvency II) Successful migration from Simcorp Dimension 17
BSB s solution for Insurance Case study Why BSB? Functional and technical coverage of Soliam BSB expertise and references in unit-linked business Strong commitment of BSB at every stage of the process Project description Project start in December 2010 and go-live in October 2011 Reasons for change? Optimise unit-linked flows in the Middle-Office Mainly asset & liabilities and order book management optimizations More than 100 000 daily transactions leading to about 500 aggregated orders Coaching mode by BSB 18
Solife: Recent developments and PAGE DE TRANSITION outlook Slide 19
SOLIFE for Insurance Recent developments Front solution in HTML5 Multi-OS Multi-device Multi-branding 20
SOLIFE for Insurance Recent developments TL-Solife 5.1 B03/2013 Investment-Solife 5.2 B08/2013 Policy View Operations (1) (1) Commissions Quotation Transaction Proposal Endorsements (2) None Information & tools General Document library, Funds catalogue, Retirement planner Advanced authentication, Role-based authorization, User/Group administration, User preferences, Branding administration, Static Screen content administration, Datagrid PDF/XLS export (1) Only the list of Operations and not the details for TL policies (2) The covered TL endorsements are Increase/Decrease capital or premium, Manage Riders, Payment mode modification, Manage Role, Manage Indexation and Booking Online 21
SOLIFE for Insurance Recent developments Retail investment products Investment slices Fee definition at slice level Indexation mechanisms Reinsurance workbench Treaty definition Calculation of RI premium, claim/benefit, commission, provision Underwriting processes changed for reinsurance interaction Traditional Life & Protection Group features Extended Scheme configuration Scheme versioning Scheme Transfert Transaction Front-end Claim register Consultation on UPL products Offer / Proposition on UPL products Special investment products UK segmentation logic 22
SOLIFE for Insurance Recent developments Documentation: Very important work done on documentation : Online help files Configuration guides 23
SOLIFE for Insurance Outlook for the current and coming year Retail investment products Web services on UPL-product logic Extending features on investment products such as: - Risk cover tax - Calculated investment premium - Fee workbench : commission clawback Specialized products (BMF/VIP) UK Tax segmentation UK Advisor charges Tax extensions for French market Traditional Life & Protection New claim module Cost reimbursement claim logic for healthcare Revamped processes offering 360 claim overview Front-end Claim register Consultation on UPL products Offer / proposition on UPL products 24
Focus on new CLAIM module A modular system for healthcare claims Rule management Extended rule workbench to manage : Application rules Reimbursement rules Correction rules Validation rules Dynamic build of rules context Product Network Convention Policy Claim type New claim type Reimbursementdriven enabling processing of medical invoices Benefit logic: Cost reimbursement Advanced threshold & ceiling management Business processes Objectives Higher operational efficiency Revamped screens 360 claim dashboards High automation Full upload of medical invoices Provider structure Hospital structure Capability for refunds at doctor level Various Domain-driven profiles Pure modular connectivity with other admin systems Extended references 25 25
Building SOLIFE Quick recap Client interaction Analyst interaction MPS-team x.0 Solife 26
SOLIFE for Insurance Live poll Mobile? Cloud? Legal development? Direct 2 Consumer portals, connectivity with money markets, STP? Evolve to a Saas / BPO-like solution? Change of the legal context (Solvency II, Fatca, IMD2, ) Live polling question: Which trend will have the most impact on the insurance industry over the next 2 to 3 years? Value chain unbundling? Split amongst distribution / product development / client management / administration / insuring risk Disclaimer : Solife Statement of Direction is subject to change 27
SOLIFE for Insurance Statement of direction - functional Distribution Self-service Portals Extend STP On-line underwriting LoB Group Life enrichments Functional coverage Wrap products unlock potential : Enable VA & VIP-features in INV-products Disclaimer : Solife Statement of Direction is subject to change 28
SOLIFE for Insurance Statement of direction non-functional R-DBMS Adding DB2 as alternative DB system BPO Add a BPO-alternative to our solutions offering Social Media Leveraging social media into our solutions Disclaimer : Solife Statement of Direction is subject to change 29
SOLIFE for Insurance Statement of direction extend e-solife Extend mobile feature by providing a smartphone version Specific set of functionality Extend transactions for INV products such as Switch on investment product Change of investment strategy Top ups Other technical endorsements Add questionnaires for underwriting Benefits Become a forerunner of the Mobile revolution Prepared for the Direct 2 Consumer trend 30
SOLIFE for Insurance Statement of direction enable online underwriting Ability to connect to an external underwriting engine Ability to send more advanced evaluations to Solife (such as added exclusion clauses, extra premiums) Benefits Vital to improve the ratio of fully automated policy approvals Essential if you work with bankinsurance-like distribution channels or if you evolve to a Direct 2 Consumer distribution logic 31
SOLIFE for Insurance Statement of direction extend group life features Extend covered product set Linking Scheme concept to investment products Extend scheme concept to define investment behaviour at scheme level Enable DC-alike product types Mass transactions Currently integration work within ESB-layer Extensions would be available in Solife with a file upload feature for joiners, leavers, modifications and anniversary processing Group offer Benefits Use Solife to manage all your Life activity 32
SOLIFE for Insurance Statement of direction VA & VIP features in INV Enables to use the extended set of functionality for VA products and for Dedicated Fund products Means essentially : Porting the VA-specific transactions to the INV-product model Create a new Financial instrument for a VIP product being a Dedicated Fund Benefits Benefit from the extended capabilities of the INV model (tax logic, business validation, op. efficiency, global client view) Be ready for the trend towards wrap products 33
SOLIFE for Insurance Statement of direction technical upgrades 2014 Migration to Java 7 Windows 8 (workstation) support 2015 Oracle 12 support Back-office client migration to HTML5 Cloud computing 34
Thank you for your attention Slide 35