Invest Pro. Case Study: Zurich International Life uses Invest Pro TM to automate the administration of Unit Linked Funds. Knowledge based software

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1 Invest Pro Knowledge based software Case Study: Zurich International Life uses Invest Pro TM to automate the administration of Unit Linked Funds

2 Case study: International Insurer uses Invest ProTM to automate the administration of Unit Linked Funds The team from Financial Risk solutions did an excellent job implementing Invest Pro, their industry knowledge added hugely to the project. The system has made a significant improvement to our entire investment administration department by increasing controls, improving processing times and facilitating significant scalability. Invest Pro has been very well received by users and management. Among the top reasons why Zurich Isle of Man chose the Financial Risk Solutions (FRS) Invest Pro software is because the team at FRS are leaders in this niche space and this was displayed throughout this complex project, we always felt comfortable with their expertise Commented Louise Duncan, Zurich International Life Background The Challenge The size of this project was very significant with 2,000 The client is part of a leading multi-line insurance The client recognised that existing investment eleven currencies and GBP6bn in assets under provider with a global network of subsidiaries and administration, unit pricing and trading processes management. offices around the world. It delivers a wide range were not scalable and needed to be streamlined With of general insurance and life insurance products stronger regulation (Solvency II) on the horizon, they and services for individuals, small businesses, and would also need robust business systems which could meet mid-sized and large companies, including the regulatory requirements, in particular to allow greater multinational corporations, in more than visibility of their asset positions and the explicit allocation of 170 countries. assets between policyholders and shareholders. As a major IOM based player in the provision of international financial solutions, the client has developed individually tailored financial solutions that are both flexible and portable. They provide individual savings, investment and protection products. funds spread over five different funds types. There are Key team members from the client and consultants from FRS embarked upon a series of Requirements gathering workshops examining these areas: Funds: 1. Mirror Funds (1,600+) 2. Blends & Constituents (200+) 3. Managed Funds (100+) 4. Money Market Funds (50) 5. Post Maturity Reserve Funds (10) Currencies: EUR Euro USD United States Dollar GBP Pound Sterling SEK SEK Swedish Krona AUD Australian Dollars CHF Swiss Francs EGL HKD JPY NOK SGD administration system and other proprietary market offerings, the client made the decision to replace its older, labour intensive systems with the Invest ProTM system. Eagles Hong Kong Dollars Yen Norwegian Krone Singapore Dollar The Solution After a rigorous review of their existing investment Unit linked funds Finance Investment accounting and interfaces Collective Fund Valuations and Unit Pricing Cash Allocation in a Fund Hierarchy Asset Trading (manual and electronic) Market Pricing Data Links Custodian Reconciliations Charging Structures Corporate Actions Processing Communication with Policy Administration Systems Communication with Corporate General Ledger This allowed the full project team to have a clear view of the requirements and targets associated with the project and how these targets would be met

3 Based on the findings of these workshops, FRS was able Cash Allocation to configure Invest ProTM to match the client s needs Fund blending / Fund of funds with approximately 95% of the solution out-of-the-box. Trade / Order Management The client s Policy Administration System, AS400 was Box Management linked directly to Invest ProTM. In addition automated Unit Pricing links were established with Bloomberg, All Funds Bank, Fees & Charges Calastone and the general ledger. Invest Pro Base Components Used Include: Fund database / Warehouse Rules Management Data Management Scheduler User configurable dashboards Report designer Report Production Unit Pricing Portfolio Valuations Investment Accounting The Implementation Test Phase & Live Migration The main steps in the implementation process During the test phase historic prices were migrated onto were as follows: Invest ProTM in a test environment and FRS s Agree Budget and Timescales processes could be improved, re-designed and in some Sign License Agreement Configure, Test and Deliver Software Training Data Migration in Parallel with the Above Activities Support Acceptance Testing Continuous project management Go live implementation consultants were able to suggest how This process is well established by FRS cases eliminated by using Invest ProTM. The test phase was completed after numerous iterations, based on the findings of FRS consultants and the client s key staff (from investment administration, finance and trading). FRS consultants and the client s key staff worked side-by-side along with a full time business analyst and project manager. The test phrase was completed before going into parallel run and lastly going live, nine months after it began. with previous clients. Infrastructure (databases, websites, apps etc.) was set up beforehand and over the course of one weekend more than 2,000 Funds and all five fund types were on-boarded to Invest Pro

4 The Benefits Investment Administration is now more scalable with Invest Pro and the Investment Administration team are seen as enablers to new growth, such as: Launching new Unit Linked Funds Offering investment administration services for different regions Operational risk is reduced Staff productivity has improved significantly The investment administration department is now scalable to manage significant new volumes of funds/aum without having to increase staff headcount; In excess of 300 additional funds have been launched with no increase in headcount The client now provides investment administration services to other parts of the group The investment data is centralised in a single database so that the same data is used for financial reporting, compliance and risk management, custodian reconciliations, cash reconciliations etc Knowledge of complex products can now be shared among all staff through clear operating procedures on a system familiar to all Key Benefits Reduction in the costs of the investment administration and investment accounting departments Using Invest Pro for unit pricing has led to a three hour improvement in processing times and a significant improvement in operational controls facilitating significant scalability. Invest Pro has been very well received by users and management. Among the top reasons why Zurich Isle of Man chose the Financial Risk Solutions (FRS) Invest Pro software is because the team at FRS are leaders in this niche space and this was displayed throughout this complex project, we always felt comfortable with their expertise' Going Forward with Invest Pro Louise Duncan, Zurich International Life noted: The team from Financial Risk solutions did an excellent job implementing Invest Pro, their industry knowledge added hugely to the project. The system has made a significant improvement to our entire investment administration department by increasing controls, improving processing times and This project has cemented FRS as the industry number one provider to the international life insurance market with 17 live implementations in numerous geographic markets. FRS CMO Frank Carr said we are very proud of the strong relationship between FRS and Zurich Life International (IOM) who are adopting more new processes and controls as a direct result of the success of this project, we look forward to a long relationship

5 About Financial Risk Solutions (FRS) Founded in 1999 by actuaries and IT specialists, Financial Risk Solutions Ltd (FRS) is a leading provider of unit pricing, investment administration, asset reporting and compliance oversight software specifically designed for the Life Assurance and Asset Management industries. The vision is to provide the best and most intuitive technology to anyone involved in investment administration a commitment which has driven FRS to become one of the leading software providers in our sector with an exceptional track record of customer success. The proven, modular solutions allow clients to pro-actively oversee and administer investments as well as mitigate risk by continually monitoring breaches and exceptions to critical investment processes: Invest Pro securely automates sixteen complex fund administration processes within a single application. Invest Pro unit-pricing and investment administration software is scalable, modular and flexible. Invest GRC empowers insurers and asset managers to meet asset reporting standards in the Solvency II world via a single, analytics-driven database, combining data from internal and external sources. Invest OPS automates the validation of operational activity performed by outsourcing partners, enabling firms to supervise outsourced functions, data and to manage the associated risks. Knowledge based software For more information contact matthew.baldwin@frsltd.com, frank.carr@frsltd.com