The insurance entity of one of Africa’s largest telecommunications companies engaged us to transform their analytics, technical finance and actuarial processes.
Their specialist actuarial and analytics team was relying on a combination of Excel spreadsheets and proprietary software to perform Life and General Insurance modelling, and this presented an array of challenges, including:
- Resource strain due to the complexity and fragility in the modelling process, with extensive resourcing required to deliver on BAU requirements and significant key person risk.
- Reducing stakeholder confidence due to the opaque modelling software that was difficult to interact with, lacked governance features and contained legacy issues.
- An insufficient level of automation in the triangle roll-forward process, such that monthly IBNR reporting was not achievable.
- Limited time in between business-as-usual processes to design and implement modelling or process enhancements.
- Difficulty in handling their large telco and insurance datasets to perform meaningful portfolio analytics, and the inability to carry out the advanced analytics techniques required to adopt a variable pricing framework, as opposed to a flat rate.
- Inability to provide timely MI on pricing adequacy and the impact of pricing and claims business initiatives.
Psicle was chosen as this client’s model office for all complex and critical processes because it would not only enable the team to overcome the present-day challenges but also empower them to implement future modelling capability enhancements themselves.
Within Psicle we developed the client’s IFRS 4, IFRS 17 (PAA and GMM) and SAM reporting for both their General Insurance and Life insurance licences. We delivered an end-to-end system for all corporate actuarial work. Psicle imports insurance and telco data straight from their in-house data warehouse and performs complex data transformations and checks before running the streamlined actuarial calculations on all bases required. At the end of the flow, regulatory reports, management information and IFRS 17 financial statement reports are fully automated.
To enhance pricing, the client has leveraged Psicle’s analytics capability, to automate variable pricing basis analysis and propose rate increases throughout the business cycle. Dynamic dashboards linked to a live database allow the users to continuously monitor the impact of changes in premium, sales strategies and claims strategies. Multiway analysis is used to identify the drivers of experience and suggest new rating factors; unleashing the predictive power of the client’s data.
With just a handful of supplementary Excel import tables and limited human interaction required within the models, the team is able to provide BAU regulatory reports as well as topical business insights in a timely, well-governed and transparent manner.