Of Special Interest

15th April 2012

SAS-helping insurers to understand their business

SAS has been serving the industry for over 30 years and its solutions are used by more than 1,100 insurers worldwide-its offerings include data management, fraud detection, risk management, regulatory compliance, and customer intelligence. In 2010, the insurance industry represented 12% of software revenue at $2.43bn and insurer's use of business analytics grew by 25% in 2011. Clients include AEGON, Allianz, AXA and Zurich.
With such a large user base, one area where SAS is particularly focused on is in the Solvency II arena where it is working with a range of European insurers. Insurance Newslink met up with Senior Risk & Solvency II Consultant, Simon Kirby, in London to find out more.
Kirby joined SAS last summer after two years at the Financial Services Authority(FSA) where he worked as a Solvency II specialist both supporting Supervisors in their dealings with the UK's largest insurers and then leading a team of Supervisors with direct responsibility for 35 smaller insurers. Prior to that, he had extensive risk management and audit experience with RSA, PwC. and RBS.
He opened by saying that "risk management and capital management should be business as usual" for insurers, and most insurers have now accepted this. He added that Solvency II should be used as a lever to fix and improve underlying problems and understand data across disperate systems.
In a Solvency II white paper, bylined "Building the Bridge to Competitive Advantage", the company highlighted six key challanges;
-data management-managing the quality and consistency of data
-meeting capital requirements
-risk management
-compliance reassurance
-reporting, and
-IFRS reconciliation.
Kirby feels that the European Commission and EIOPA(previously CEIOPS) has made the delivery of Solvency II more difficult and complex than it needed to be by "trying to eat the Solvency II elephant in one bite". He said that it would have been better to deliver the Directive in phases and break down the complex issues to make it more simpler-for example, deliver the Risk Management requirements first followed by the Capital Management requirements.
We discussed the wider growth in insurance business analytics. In particular, fraud detection, third party claims management, pricing, predictive "what if" analytics, and customer segmentation and sentiment, with the social media explosion presenting both an opportunity and a threat to insurers-all business issues which need to be taken into account to optimise the ongoing Solvency II compliance requirement and opportunity.
Kirby mentioned that SAS often works with partners which include Accenture, Cap Gemini, Deloitte, and Wipro.
The SAS byline is "The Power to Know"-SAS has deep global experience in the insurance industry on assisting insurers to understand their business better to enable quicker, effective, and more accurate decisions.