The InsFocus Advantage for Insurance Companies

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1 The InsFocus Advantage for Insurance Companies Executive summary What is InsFocus? A complete reporting and analysis solution for insurance companies, InsFocus provides all the data warehousing (DW) and business intelligence (BI) required for effective management. InsFocus replaces the traditional ETL/DW/BI tools needed for lengthy projects with a comprehensive and efficient end-to-end solution. Why is InsFocus better for insurance? InsFocus is designed and built for insurance companies by insurance professionals. InsFocus incorporates dozens of years of insurance industry experience and provides insurance-specific reporting and analysis functionality that traditional solutions can t match. What are the system s main advantages? Functionality: InsFocus is a built-for-insurance system providing out-of-the-box, insurance-specific calculation methods, reporting, and analysis. Data model: Our prebuilt, tested, and optimized insurance data model is the foundation for superior insurance data management solutions. Insurance content: InsFocus comprehensive library of hundreds of insurance measurement definitions, insurance dimensions, risk factors, and sample reports caters to any insurance business user s requirements, including marketing and sales, underwriting, claims, reinsurance, actuarial tasks, internal audits, and accounting. Infrastructure: Our robust IT infrastructure means information security and granular data access control, plus easy and secure system administration, performance optimization, SOA connectivity, and multilingual capability. Self-service: InsFocus incorporates a truly self-service reporting and analysis user interface that enables business users to define their own analysis and reports without sacrificing sophistication. Complete solution: InsFocus manages the full BI cycle without the need for additional ETL or BI tools (other than Microsoft SQL Server). What are the business benefits for an insurance company? InsFocus facilitates information-based decision-making at all levels, leading to improved business performance and underwriting results. Quick and predictable implementation is based on InsFocus Structured Insurance Project methodology. InsFocus is engineered for cost-efficient system maintenance. Combined with its low entry costs, InsFocus approach to system maintenance typically saves businesses up to two-thirds the cost of comparable solutions. About InsFocus Systems InsFocus Systems is a private company founded in 2003 by Uri Taiber, an insurance expert with over 20 years of insurance company management experience. The company is based in Israel and operates worldwide in cooperation with local representatives and implementation partners. 1

2 Contents Executive summary... 1 Company background and history... 2 Insurance-specific functionality... 3 Insurance content... 5 Reporting and analysis infrastructure... 7 User interface features... 9 Implementation methodology Summary Company background and history InsFocus is a private company founded in 2003 by Uri Taiber, an insurance expert with over 20 years of insurance company management experience. The Taiber family has been associated with the insurance business for over 60 years as owners and executives of Zion Insurance Company, one of the first insurance companies in Israel. During his 20-year tenure at Zion, Uri held numerous positions, including branch office manager, inward and outward reinsurance head, non-life division manager, and joint general manager. Following the sale of the company in late 1999, Uri held the position of consultant to the Munich Re. In 2003, Uri founded InsFocus to create a reporting and analysis solution that packages his accumulated experience into a technological platform delivering a superior solution to insurance companies. Development of the InsFocus Insurance Data Model and technical platform began in early 2004 at the company s premises in Petach-Tikva, an historic town east of Tel-Aviv, known for its industry and high-tech enterprises. The company s development team is headed by Hanan Taiber, a leading data architect and applications development professional. The company s business development activity is centered on four geographical regions: India, Germany, Turkey, and Israel, using regional consultants, plus IT partnerships in the Netherlands. The company s first client was an Israeli insurance company that began operations in January, The company is focused on motor insurance, and its business priorities are better sales management and claims control. InsFocus helped this client achieve its goals in less than a year, and the first deliverables were provided four months from project kick-off. A second project was done for a Netherlands business partner in This client provides online procurement services for the healthcare sector, including purchases and supplier management, stock management, and invoicing. In the Netherlands, InsFocus is delivered on a SaaS basis, and the system is being used by a number of healthcare organizations, including the prestigious AMC (Academic Medical Center of Amsterdam). In 2009, InsFocus embarked on another major project for a leading Maltese insurance company. The emphasis of this project was servicing the information requirements of a multi-line insurance company, covering their agency network, and providing full insight into the workings of their comprehensive reinsurance program. 2

3 From the beginning, the company has followed a policy of Agile development, with new product releases coming out every six months, on average. All client installations are updated as part of service provided by InsFocus. The company s development roadmap is based on client requirements and on the latest technological infrastructure developments, and InsFocus solution continues to deliver up to and beyond client expectations with cutting-edge, flexible, and easy-to-use insurance BI technology. Insurance-specific functionality Insurance business activity is unlike any other. The timing issues alone are enough to severely constrain the effectiveness of BI solutions aimed at a general business audience. In the insurance business, for example, policies are issued for varying coverage periods, policy conditions and rates can be changed by midterm endorsements, claims are reported in delays, claims reserves are set and adjusted over time, and claim payments are made at even later dates. These time dependencies affect the way insurance business is reported and analyzed and the way an information solution for insurance has to be structured. The following features built into InsFocus provide insurance executives and professionals with the full spectrum of data reporting and analysis functionality required to effectively manage their businesses: Prebuilt insurance data model The InsFocus DW model is a star-schema dimensional model 1, adapted specifically for insurance company data and optimized for insurance reporting and analysis calculations. Its design is closely tied to the functionalities built into the InsFocus BI suite. InsFocus data model is compact and designed for runtime optimization. The model stores granular data with policy, policy coverage, claim, and claimant detail, enabling drill-down functionality and detailed reporting. Built-in insurance metrics InsFocus includes metrics and profitability indicators such as loss ratio, loss frequency, burning cost, and risk cost per policy, all reported on gross, reinsurance, and net bases. These built-in KPIs provide advanced reporting and analysis capabilities out-of-the-box. Additional information about insurance specific content is provided later in this document. Time rollback The InsFocus system stores information at individual transaction granularity, allowing users to view any report exactly as it appeared on any particular date. Insurance professionals can review underwriting decisions with the same data used when the decisions were made, and financial results can be analyzed using their effective date. Time bases InsFocus accounts for insurance time dependencies within its data model and calculation methods. This enables analyzing insurance information from different time perspectives, providing accurate analysis and reporting to marketing executives, underwriters, claims managers, reinsurance managers, actuaries, and accountants. The system provides operational reporting, financial accounting analysis, policy inception (underwriting year statistics), accident/pro-rata (actuarial analysis), and snapshot reports (for reinsurance excess of loss rating). 1 Ralph Kimball type model 3

4 Each time base perspective alters the way measurements are calculated, and the system supports interdependencies between them. Dynamic earned premium and unearned reserve calculations InsFocus provides an optimized data warehouse structure that enables fast earned and unearned calculations using any selected date. Calculations are done on pro-rata temporis basis and are defined for each relevant time base, providing precise unearned reserve or earned premium calculations at any information level, from an individual policy coverage section to an organization s entire product line. This feature allows executives to monitor their portfolio profitability on a daily basis and detect trends ahead of time. Insurance exposures/sums insured views Insurance is not just about premiums and claims cash flows. Companies need to monitor their exposure to risk, whether unit-based or sum insured-based. InsFocus provides insurers with prebuilt calculation methods and measurements to analyze and monitor their exposures to underwriting risk on gross, reinsurance ceded, and retained bases. Complex and changing organization structure InsFocus fully supports asymmetric organizational structures and multiple hierarchy chains. It also provides as-is and as-if views when organizational structure changes. This ensures correct reporting of distribution channel sales and profitability performance, as well as correcting for distortions brought about by reorganization. Product line crossover reporting The majority of insurance products are made up of sections or coverages representing different insurance coverages, insured objects, or a combination of both. InsFocus data model and query building functionality provide built-in, seamless analysis along both insurance products and lines, giving the company s underwriters invaluable insight into business behavior. Renewal and lapse comparisons Policies and premiums up for renewal are grouped by their renewal date. The InsFocus system provides renewal lists, analysis of lapses, and renewal rates comparisons. These functionalities highlight insurance product characteristics and distribution channel behavior, as well as offering active marketing and sales support. Unlimited risk parameters Unlike conventional BI tools, InsFocus enables viewing different risk parameters for each insurance product (e.g. vehicle type and driver age for motor vehicle insurance, building type and floor for home insurance, and occupation and health status for health and accident insurance). These views provide insurance product pricing information at the underwriter s fingertips, saving days or even weeks of data analysis work required by traditional analysis methods. The number of risk parameters defined per product is unlimited and performance load is linear, unlike some conventional data architecture types where the number of dimensions is limited by exponential performance load. 4

5 Claims activity monitoring InsFocus captures full claims information, including outstanding claim reserves, claim payments, payment components, event codes and perils, deductibles, and all relevant claim activity dates. The system s built-in metrics provide claims managers with the full spectrum of information required to monitor claims activity and effectively manage it. The available information takes date interdependency into account, enabling analysis views of opened, closed, and re-opened claims by payment, occurrence, and reporting and policy dates. InsFocus also lets managers break down payments by indemnity, expenses, and subrogations. Claims reserves analysis/triangulation Claims reserve analysis is supported by two powerful features that give further insight into reserve activity: A built-in triangulation statistics mechanism provides a view comparing any time base to any dependent time base. For example, incurred claims on financial year basis can be compared on an accident year basis, creating the classic triangulation statistics. Using a built-in Chain-Ladder extrapolation mechanism, the company s actuary can get a first estimate of the IBNR reserve required for a particular line of business or claim type. The system s Claim-Status-Filter provides out-of-the-box runoff statistics, comparing historic reserves to the actual values at which claims were finalized. This tool can also be used for auditing outstanding claims estimates lists at financial statement closure. Parametric IBNR allocation Described in more detail below, InsFocus calculation mechanism is based on reusable calculation templates. Such templates are available for allocation of IBNR reserves calculated by the company s actuary on total company portfolio down to individual policy and claim level. This mechanism, which must customized for each company s claims reserving practice, gives executives the power to drill down from a companywide profit-loss analysis to agency, product, geographical area, or even individual client levels. Multi-currency accounting and index-adjusted calculations The system includes two powerful built-in features which are required by almost any insurance entity: InsFocus features multi-currency information management that enables consolidation of company information to base currency reporting and detailed reporting of original currency transactions. The mechanism supports the multiple currency conversion rates that may be required under different accounting standards. Seamless index-adjusted reporting is especially useful for preparing historic long-tail claim statistics used for design and pricing of excess of loss protections for motor and liability lines. The system supports multiple index bases and can be customized to specific territorial index standards. Insurance content InsFocus contains predefined insurance measurements (items), dimensions, risk parameters, and sample reports. All predefined information elements are stored in a data dictionary that can be customized and edited using the InsFocus System Center. 5

6 Measurements (Items) InsFocus basic items library contains over 250 definitions, divided into four categories: Policy items: This category includes all definitions derived from policy data only, such as various premium measurements, earned and unearned premium calculations, sums insured issued or exposed, agent commissions, numbers of policies, endorsements, cancellations, coverage sections, and exposures measured in units, ratios, and averages. In addition, the dictionary contains a set of definitions for reinsurance measurements and a set for retention, plus definitions regarding sales targets and service levels (days to actions). Claims items: Claims items include claims paid, outstanding, and incurred, plus numbers of claims opened, closed, and reopened. Claims items definitions also encompass indemnity, expenses, deductibles, and reporting delays, as well as averages, status, and similar definitions for reinsurance claims and retention. Profitability items: These definitions combine policies and claims items, such as loss ratios, loss frequency, and underwriting profitability, all on gross/reinsurance/net bases. Premium accounting: This category contains measurements associated with the premium collection process, such as collected premiums, open premiums, amounts and numbers paid in time and overdue, plus ratios and average days. Dimensions Dimensions defined in any specific implementation are dependent on the way a company s portfolio is organized. Typical dimensions are geographic, client information, marketing information, policy administration process, currency, product definition and grouping, coverage and grouping, operational information, claim event type, claimant information, and type of claim parties. Risk parameters Risk parameters depend mainly on the insurance products in an insurer s portfolio. Typical parameters include building code in home insurance, industry code and fire classification in property insurance, vehicle, model, and driver information in motor insurance, and age, gender, and occupation in accident insurance. Sample reports InsFocus library of sample reports addresses business issues concerning executive management, sales and marketing, underwriting, claims, reinsurance, actuary, internal auditing, and accounting. Executive reports: InsFocus provides a variety of dashboards displaying ongoing performance, profitability, and KPIs. Sales and marketing: Sales reports show comparative figures by distribution channel, product, and marketing campaigns. Exception reports highlight cancellations and commission costs over a company-defined threshold. Lapse analysis, renewal rate comparisons, and ongoing agent level renewal lists help reduce the company s portfolio attrition. Finally, policy administration reports keep track of operator activities, and cross-selling/up-selling lists support the company s active sales initiatives. Claims: InsFocus generates reports that monitor ongoing claims activity, such as claims opened, closed paid, claims reserves, claims averages. To help insurance businesses monitor cash flow, InsFocus features reports to keep track of bilateral cash flows vis-à-vis claim parties and reports 6

7 monitoring cash flows to service providers. Latency and service-level reports, showing days between relevant claims on various bases, are provided, as are runoff reports to validate sufficiency of outstanding reserve estimates. Reinsurance : InsFocus reinsurance reports include exposure reports to monitor aggregate and peak exposures, claim development reports for excess of loss protection quotes, cession reports to control amounts ceded and cession margins, and reinsurer s experience reports on treaty and facultative bases. Actuaries: For actuaries, InsFocus offers claims development triangulations on a paid / incurred basis for reserving, as well as claims reporting triangulations. Also included are average cost of claims and average claim load per exposure reports for pricing, plus the ability to export claims lists into Excel for offline analysis. Internal auditors: InsFocus features exception lists on policy activity and claims by predefined criteria, serving to highlight suspected fraudulent activities. Accountants: Accountants benefit from InsFocus daily profit-and-loss pro forma reports, extraction lists for generating regulatory reports, and reserve calculations as a basis for quarterly financial reporting. Reporting and analysis infrastructure InsFocus leverages a robust data querying and management infrastructure built on top of Microsoft SQL Server 2005/2008, and its data integration module resides on Microsoft SQL Server Integration Services (SSIS). The system s code is optimized for Microsoft-native platforms, ensuring high- performance queries. The software suite is composed of the following elements: Open code calculation templates At the heart of InsFocus is an optimized SQL calculation engine. Calculations are processed using open code SQL calculation templates that can be created and adapted by a company s IT professionals. These templates are reusable code elements that are integrated into the system s metadata definitions manager, providing a platform for complex calculations. Report creation is done at two levels query builder and user interface both driven from the system s user interface. Nontechnical business users can independently create reports and save them in their private libraries. They can also run predefined reports from the central public library and adapt them to their specific business objectives. Data-level, role-level, and restriction-based permissions InsFocus incorporates enterprise security measures that control user functionality and access to data on three levels: Data-level permissions allow users to view only data defined in their organizational domain, enabling widespread system use across the organization while maintaining information access control. Role-level permissions prevent users from performing actions not permitted by their roles within an organization, allowing administrators to control activities such as defining new reports, printing, exporting, etc. 7

8 Restriction-based permissions control which items (measurements) and dimensions are available to each user group, enabling definitions such as claims-only user, sales-only user, and so on. Central system administration System administrators can manage InsFocus BI from anywhere using the System Center. This software module provides tools to perform administrative tasks, view system logs, change settings, define new users, and edit query items and dimensions building blocks. All this is accomplished using a fast and simple interface. Report scheduler Any user with appropriate permissions can schedule reports that run automatically on predefined schedules and which can be dispatched in a number of ways: Reports can be scheduled to run daily, weekly, or monthly. Report schedules can include both reports saved in a library and unsaved queries. Results can be sent as a template-based, formatted, HTML . Results can also be sent via SMS directly to executive cell phones. Secure SOA with REST services InsFocus BI is fully SOA-based, exposing all system functionalities as secure HTTP web services. These web services follow common REST (Representational State Transfer architecture) patterns, allowing easy discovery and use of services. This feature is extremely useful in connecting InsFocus to other applications in the organization. Results can be returned as XML (used in all high-level languages), JSON (used in JavaScript), and HTML (for direct display). Pre-aggregation mechanism The system builds a set of aggregation tables at the end of each ETL session, each based on company-specific definitions. These tables enable InsFocus to return the majority of queries in seconds, while retaining unlimited drill-down and reporting capabilities. Data warehouse-centric ETL InsFocus data integration module is written over Microsoft SSIS to handle loading InsFocus BI s data warehouse model from a large number of source systems. The module is designed to integrate data from sources that include relational databases, such as SQL, Oracle or DB2, text (flat) files, Excel tables, XML files, and websites. The data integration processes provide solutions to common data warehousing issues, including slowly changing dimensions, staging area maintenance, surrogate key generation, erroneous data handling, and process logging. The module is completely table-driven and can be fully customized with an insurance company s data structures. Advanced support for incremental data loading enables the company to implement end-of-day loading with very short run times. 8

9 User interface features InsFocus user interface is the single point of contact between users and the system for report creation, report viewing, analysis, and dashboards. Its most important features are listed below: Graphical report library Reports are displayed and accessed from a graphical reports library, where users can easily organize and retrieve them. The library has private folders that allow users to save their own reports and a public library containing the company's master reports. Each report is displayed with a graphical preview for easy browsing. Intuitive report definitions Defining new reports and analyses requires only a few simple steps, which nontechnical users can learn in a very short time. Users can define ad-hoc queries instead of relying only on ready-made reports by IT. They can also use library reports as a basis for creating and saving their own versions. Result viewing & manipulation Results returned by the system can be visually presented using split-screen tables, charts, and gauges. An Excel-like tab control enables users to view multiple sheets of information in the same report. Results can be extensively manipulated by the user through an array of controls, such as sorting, advanced filtering, result highlighting, contribution view, cumulative view, and user-defined calculations. Flexible drill-down and drill-through Unlike systems with rigid drill-down hierarchy, InsFocus BI enables drill-down (row/column) and drill-through (cell) to any defined dimension, organizational member, or time period as far down as the client, policy, or individual claim level. This helps users understand the facts underlying any displayed result. Batch run Batch run allows running a report for many organizational members at once, producing files that can be sent by mail, printed, or placed in a portal. Measurement filters Data can be filtered not only by static dimensions, but by dynamic calculations. For example, a user may ask to see a profitability report for clients with more than five policies and having over $100,000 premiums. Banding (risk profiling) Banding is the process of splitting insurance data into dynamically created bands. This can be simple data, such as an insured s age, or complex data, such as loss-frequency. Banding is heavily used in insurance, where reports such as risk profiling, client segmentation, and so on are needed on a regular basis. InsFocus BI allows dynamically defining bands by: Dimension attributes (e.g. client year of birth, policy number) Risk parameters (e.g. engine size, year of manufacture, floor number) Any item (e.g. loss-frequency, sum insured, number of policies) 9

10 Implementation methodology Implementing InsFocus data warehouse requires integration with all of a company s source systems. InsFocus has developed a Structured Insurance Project methodology that ensures efficient and predictable project delivery. The methodology follows Agile principles, allowing short delivery times while building functionality incrementally. Learn Design Implement Deliver Learn: get to know the company s insurance business and data Design: define deliverables, processes, and model adaptations Implement: adapt data models and build data integration processes Deliver: build a common reports repository, transfer knowledge, and train Learn This phase begins with a technical and business workshop at the client s offices. The objectives of the workshop are learning the company s business specifics and profitability drivers, discovering its source systems data structures and interrelations, and gathering management-specific requirements. Typically, a workshop may last three to five full days and involve technical IT personnel and business domain representatives. Information learned in the workshop is the basis for data model adaptation and project design. Design Following the workshop, a project scope document defining project deliverables (measurements, dimensions, calculations) and outlining project phases is prepared. Typically, an insurance company s project will be broken into the following phases: Policies Claims Reinsurance Each phase is separately designed in two steps, beginning with a high-level design describing technical and business processes from a high-level technical perspective. The high-level design document contains an overview of company s business entities and processes, a detailed outline of ETL technical processes for each business entity, and process and reliability tests. This document serves as the basis for writing the low-level design. The low-level design document is a detailed data map showing all data objects in the source system, staging area, and data warehouse. The document describes all data management processes involved, including column types, data flows, business logic scripts, and validation rules. The document serves as the basis for technical implementation. Implement After each phase is fully designed, the next step is implementation. Implementation involves creating numerous data management processes, based on the low-level and high-level design documents, using InsFocus library of pre-packaged components. Processes are typically categorized into three types: 10

11 Deliver Data integration steps: This is the bulk of the ETL process. Data integration involves data extraction from source systems and external sources, data loading to staging and the data warehouse, data relation updates, and business logic scripts. These tasks are accomplished using prebuilt parametric ETL packages and scripts, driven by the system s administration tables. Validity tests: This step involves writing a set of automatic tests that take place during ETL and which validate data consistency and reliability, in addition to specifying actions to take if those tests fail. Data adaptation scripts: During the workshop, design, and implementation phases, data inconsistencies arise. Some of those issues can be corrected in the source system, while some require reconstructing data, fixing corrupted data, or adapting the ETL process. The first step in delivery is data validation. Data validations are done by comparing a company s summary and detailed control reports to data produced by InsFocus. The next step is adapting InsFocus generic reports library to the company s business philosophy and building new reports according to company needs. This process requires key business users from all departments to assist in reviewing reports, adapting their structure, creating additional measurements and dimensions, and defining new reports. Knowledge transfer and training involves: End-user training: End-user training takes the form of comprehensive workshops with business users or the company s appointed BI specialists, ensuring they are up to speed with system s functionality, data model, and available reports. Technical training: This training ensures that IT personnel and system administrators have the ability to handle first-level support and create additional content based on user requirements. Summary With its combination of insurance business domain expertise and application development skill, InsFocus is the best choice for insurance companies looking to advance to the next level of reporting and analytics support for their core operations. For more information, please visit us at or contact us at either info@insfocus.com or