Future of motor insurance– Let’s Talk InnovationSwiss Re Nordics Motor Roundtable, August 2018, Sebastian Risse
Swiss Re Nordics Motor Roundtable | 30 August 2018 | Sebastian Risse
• Speed of Claim Payment
• Value Added Services
• Accessibility
• Price
2
Swiss Re Nordics Motor Roundtable | 30 August 2018 | Sebastian Risse
• Customer
Portals
• Mobile Apps
• Online Forms
• Social Media
• Digitization
New Technology and Approaches Help to Make the Claims Process More Efficient and Effective
3
Claim
Submission
Claim
Processing
Adjudication
& Decision
Data Analysis, Solution Definition, Project Management, Change Management
Payment
HandlingReinsurance
• Automation
• Document
Classification
• Robotics
• Image
Recognition
• Chatbot
• Big data
• Artificial
Intelligence
• Segmentation
• Drones
• Blockchain
• Offsetting
• Partner
Solutions
• Acord
Messaging
• Risk Based Work
Distribution
• (Claim) Portfolio
Management
Approach to Implement new Technology & Methodology
Swiss Re Nordics Motor Roundtable | 30 August 2018 | Sebastian Risse
• Customer
Portals
• Mobile Apps
• Forms
• Social Media
• Digitization
Please vote for the trend that interests you most and you want to discuss further now: Enter a single word only
4
Claim
Submission
Claim
Processing
Adjudication
& Decision
Analysis, Solution, Project, Change
Payment
HandlingReinsurance
• Automation
• Classification
• Robotics
• Imaging
• Chatbot
• Bigdata
• AI
• Segmentation
• Drones
• Blockchain
• Offsetting
• Partner
Solutions
• Acord
• WorkDistribution
• Portfolio
Approach to Implement new Technology & Methodology
Swiss Re Nordics Motor Roundtable | 30 August 2018 | Sebastian Risse 5
Swiss Re Nordics Motor Roundtable | 30 August 2018 | Sebastian Risse
When to use Robots
6
Swiss Re Nordics Motor Roundtable | 30 August 2018 | Sebastian Risse
Why use a Robot?
• Robots free up employees
to perform higher value
activities
• Robots are able to automate
manual, repetitive, rules-
based activities
• Robots do not make
mistakes, increasing
accuracy and data quality
• Robots can run 24-7 and in
parallel, supporting peak
workload periods
Should I consider building a robot?
7
Is the process entirely based
on rules?
Is the data available
electronically?
Is the data structured / in a
consistent pattern?
Yes
Yes
Yes
How much time do you spend a
year on this task?
> 0.5 FTE
� Process may be a good candidate
for Robotic Process
AutomationIs the process a control which
has had failures?
< 0.5 FTE
Yes
Robots currently can only handle
Rules Based Processes
No
Consider digitization first (e.g. scanning)
No
Is Manual pre-processing feasible?
(e.g. Align into Template)
No Yes
Robots: Let them work
while you think
Swiss Re Nordics Motor Roundtable | 30 August 2018 | Sebastian Risse
Document Classification Example:Flexible Document Classifier
8
Swiss Re Nordics Motor Roundtable | 30 August 2018 | Sebastian Risse 9
The Flexible Document Classifier identifies Claims Documents that require a Manual Review
FDC scans documents
Fraud
Subrogation
Court Case
Client sends claim
documents
Auto
Processing
Manual
Review
Swiss Re Nordics Motor Roundtable | 30 August 2018 | Sebastian Risse
Automation Example:Claims to Contract
10
Swiss Re Nordics Motor Roundtable | 30 August 2018 | Sebastian Risse
C2C Automatically matches Claims to Contracts by Identifying Key Information in Unstructured Documents to SwissRe’s Structured Databases
11
Analysis In-Box
• 62 Active
Induction email
addresses for
Crew
• 20,000+ monthly
submissions
• 14,000 new
claims per quarter
High
TMA: IF prediction is greater
than X%, THEN select Claim
ID, details are Auto Populated
& Auto=Complete
@Swissre.com
Automated Claim Search
@Swissre.com
@Swissre.com
@Swissre.com
@Swissre.com
@Swissre.com
Automated Contract Search
Automated Cedent Search
Acord:
• Auto Triage
Non-Acord:
• Predictive Triage tools:
• TMA finds claim
• C2C finds contract &
Cedent
Submission Induction Search & Indexation Delivery to Analysis
Analysis In-Box
Analysis In-Box
IF no Claim is found, check via
C2C for Contract ID: IF
prediction is greater than X%,
THEN select Business ID,
details are Auto Populated &
Auto-Complete
IF no Claim or Contract is
found, check via C2C for
Cedent: IF prediction is
greater than X%, THEN select
Cedent ID, & Auto-Complete • Greatly simplify the number of active Routing Rules
• Significantly reduce the number of active Doc Classes
• Still routes to Operations
• Operations verifies triage accuracy and amends as needed
(Teaching the machine)
Low Flow
Name Documents & Infer what
kind of Document Type it is:
I.E. Payment or First Advice
and
Add Process Driver
Process Characterization
InputOutput
Swiss Re Nordics Motor Roundtable | 30 August 2018 | Sebastian Risse
Block Chain
12
Swiss Re Nordics Motor Roundtable | 30 August 2018 | Sebastian Risse13
Retrocessionnaire
Reinsurer
Insurer
Policyholder
Smart
Contracts
• Shared mutual ledger
• Consensus Process
• Smart Contracts
• Direct Settlement
From
To
• Credit Risk
• Financial Reporting Risk
• Cash Flow Inefficiencies
• Contract Uncertainty
• Reconciliations
• Multiple Sign-offs and Delays
• Improved Data Quality and Exchange
• Fast and Auditable Sign-offs
• Auto-execution of Contract Conditions
• Faster and Transparent Cash Settlement
Bank
The Vision
Regulator
Swiss Re Nordics Motor Roundtable | 30 August 2018 | Sebastian Risse
Swiss Re expects a range of benefits in respect to Block Chain
14
Working Capital
Improvement
Faster and more
efficient premium and
claims settlement and
optimised liquidity
management
Operational Efficiency
and Risk Reduction
Reduction of contract
uncertainty,
reconciliations and
process inefficiencies
Quality and Integrity of
Data
Normalised and high-
quality data in a shared
source with central
control over integrity and
easier auditing
Foreign Exchange
Management
Accelerated FX
transactions and
consistent valuation
Positive Impacts:
• Combined Ratio – conservative estimate of -0.5%
• Improved liquidity
• Risk Reduction
More info: https://www.linkedin.com/pulse/b3i-turning-blockchain-use-case-business-paul-meeusen?published=u
Swiss Re Nordics Motor Roundtable | 30 August 2018 | Sebastian Risse 15
Blockchain Insurance Industry Initiative- Smarter together across the industry
Vision: Jointly explore the potential of Blockchain
technology in industry-wide use cases to better serve
end-clients
Foundation: Five founding members with equal rights
Initiative launch date: October 2016, foundation
meeting took place at Swiss Re
Focus: A first pilot project for retrocession of large
insurance contracts between the participating
companies is initiated, based on Swiss Re developed
prototype
Membership requests: B3i is open for other insurers
and reinsurers to join. Several large firms have
announced interest.
Key Facts
…
Press release:http://www.swissre.com/reinsurance/insurers_and_reinsurers_launch_blockchain_initiative.html
Swiss Re Nordics Motor Roundtable | 30 August 2018 | Sebastian Risse
The B3i PedigreeShared Ledger Technology and ACORD
16
Structured Business Process
Template
• clear sub-process triggers & terminations
• Agreed behaviours (eCOT, eBOT)
Communication Standard
• codified exchange
of business data (between different systems)
• mutually verifiable end-points (origin and destination)
• data transport security & integrity
Data Representation Model
• agreed definitions &
attribute relationships
Single Source Data
• Contract Structure
• Attribute population
• Partition & Ownership
Status Tracking
Explicit/Executable Rules
• Agreed calculation logic
• Deterministic Outcome
Single Process
• Orchestrated
• Steerable
• Auditable
• Secure
B3i
Leverage Existing Knowledge Base to Advance Market
Swiss Re Nordics Motor Roundtable | 30 August 2018 | Sebastian Risse
Acord Messaging
17
Swiss Re Nordics Motor Roundtable | 30 August 2018 | Sebastian Risse
• ACORD is a Non Profit organisation developing transactional standards in the Insurance and Reinsurance
sectors. Also operates in the L&H and P&C forms arena
• Standards are updated every 12-18 months
• Swiss Re is an ACORD member and is heavily involved in developing and maintaining messaging
standards in the Reinsurance and Large Commercial (GRLC) sector
• The Rüschlikon Group is a market initiative of large brokers & carriers* to implement a common subset of
the ACORD GRLC standards called:
– eBOT: Implementation guidelines for accounting and settlement messages
– eCOT: Implementation guidelines for claim messages
• Other industry groups & markets are implementing ACORD messaging, usually aligned to Rüschlikon Group's eBOT / eCOT
implementations (e.g London Market’s Central Services Refresh Program, run by XIS)
*Participants: Aon, Guy Carp, Willis, Swiss Re, SCOR, Munich Re, Hanover Re, XL group, Axis, Partner Re, etc.
ACORD Standards
Swiss Re Nordics Motor Roundtable | 30 August 2018 | Sebastian Risse
• CM Sender creates one Claim Movement message per layer:
– Movement Type (various indicators) : initial_advice, subsequent_advice, closing_advice, replacement,
reopen, reopen_and_close
– Type of Transaction (various indicators) : Status Update, Reserve Update and/or Payment, Contract and
Claim Details: references, participations, Date of Loss / Description / Loss Location, etc.
– 100% layer figures (Recommended: FGU figures)
• TA If settlement required, Sender also creates a TechAccount message:
– Transaction Type: claim_transaction
– Xref to Claim and associated CM message
– Net Receiver Shares figures
• TA RIP In case of RIP, a further TA message for the premium amount:
– Transaction Type: reinstatement
– Xref to Settlement TA
ACORD Based Claim Handling:Building a Claim Movement with messages
Xref to TA
Xref to CM
Currency USD
Group Refs link
messages across
multiple currencies
Currency CHF
Currency EUR
Group Ref
TAs
(across
currencies)
Group Ref
CMs
(across
currencies)
Swiss Re Nordics Motor Roundtable | 30 August 2018 | Sebastian Risse
Portfolio Management
20
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Swiss Re Nordics Motor Roundtable | 30 August 2018 | Sebastian Risse 22
Swiss Re Nordics Motor Roundtable | 30 August 2018 | Sebastian Risse
Big Data Example: Claims Development Tracker
23
Swiss Re Nordics Motor Roundtable | 30 August 2018 | Sebastian Risse 24
How Do You Handle Your Claims?
Swiss Re Nordics Motor Roundtable | 30 August 2018 | Sebastian Risse
No
rma
lise
d V
alu
e [
$/$
Tot.
Inc]
Adjusted Age in years [AsOfDate – DoL]0
(DoL)3
0.2
2N
0.4
0.6
0.8
1.0
Y
1
Q3 (75%)
Q1 (25%)
Q2 (median)
Historical Claim Behaviour will Identify New Claim Outliers
25
Claim Portfolio Q2 (median)
Q1 / Q3 limit
Total Incurred
Claim portfolio datapoints
Claim IC123 outlier
Claim IC123 development
Deviation from expected behaviour
4
Swiss Re Nordics Motor Roundtable | 30 August 2018 | Sebastian Risse
The Claim Handler
Predict the behaviour of a single based on
the claim handler markets, clients and
claims portfolios knowledge
0
20
40
60
80
100
120
0 10 20 30 40 50 60 70 80 90 10
Average prediction error - % over lifespan
Claim Handler
Swiss Re Nordics Motor Roundtable | 30 August 2018 | Sebastian Risse
0
20
40
60
80
100
120
0 10 20 30 40 50 60 70 80 90 10
Average prediction error - % over lifespan
Claim Handler CDT
The Claim Handler and Claims Development Tracker
Predict the behaviour based on
historical claim behaviour
• Better claim
adjudication (fraud
detection, portfolio
steering, etc.)
• Better reserve
management (“Single
Claim Reserving”)
Swiss Re Nordics Motor Roundtable | 30 August 2018 | Sebastian Risse
Approach to Implement new Technology & Methodology
28
Swiss Re Nordics Motor Roundtable | 30 August 2018 | Sebastian Risse
SwissRe’s “World Class Processes” (WCP) improves internal business processes with the goal to provide
efficient and effective procedures which address the clients needs.
The following slides show how WCP improved the claims handling and technical accounting processes
through:
1. Identification of improvement opportunities through as-is monitoring
2. Root Cause Analysis of as-is Processes
3. Definition of Solutions in Collaboration with the Employees
4. Implementation of new Processes using Change Management Techniques
Overview
29
Swiss Re Nordics Motor Roundtable | 30 August 2018 | Sebastian Risse
• Productivity
• Throughput
• Data Quality
• Customer Satisfaction
1. Identification of improvement opportunities through as-is monitoring: Which KPI‘s don‘t match the strategic direction?
30
Business Management Cockpit
World Class Processes:
Claims and Technical Accounting
Continuous Process Improvement through
„Bottom-Up“ Initiatives (Employee Driven)
Regional Process Variations generate
Inconsistent Results
Digitalization und Automation during Triage
and Analysis
Low Data Quality, Productivity and Turnaround
Time don’t Meet Client Expectations
Me
asu
reA
na
lyse
s
• Snapshots
• Trends
• Comparisons
• Best Practice/ Benchmarking
Swiss Re Nordics Motor Roundtable | 30 August 2018 | Sebastian Risse
2. Root Cause Analysis of as-is Processes : What has to Change?
31
Sample Analysis Tools
World Class Processes:
Claims and Technical Accounting
All Bookings are processes equally, no
Segmentation
Employees take No Ownership for data
quality, etc.
Front loaded Analysis require High Manual
Efforts
Low Risk Appetite with lead to non-value
added reviews
Data
Stratification
Process
Mapping
Root Cause
Analysis
Swiss Re Nordics Motor Roundtable | 30 August 2018 | Sebastian Risse
3. Definition of Solutions in Collaboration with the Employees: What does our Solution look like?
32
World Class Processes
Segmentation
Become a
detective
Letting go of low risk claims: Give claim approval
to set the claim to “flow” until an exception:
Technical
Approval
Minimize
Manual Claim
Approvals
Technical AccountingFrom “One-Size-Fits-All” to
“Differentiated Processing to Focus on Valuable Transactions”
Claims HandlingFrom “High/Low/Flow challenges” to
“Getting to 60% Flow Business”
Define thresholds &
limits
Approval Expiration
Date
Claims
notice
Approval
needed?Booking EndStart
Smart
ReviewEscalation
Decision
Making
From preventive to detective checks: most
transactions will be good, so we will analyze them
holistically after processing
Less
controlling of
clients that
we trust
Client Impact Focus
Ignore small
mistakes
Put the
efforts into
cases that
need our
attention
Focus on the
big picture
Less
“Queue Mgmt”
Focus on
Important Cases
Find the needle
in the haystack
Keep a Portfolio
Oversight
Steer the business using
Smart Tools
Swiss Re Nordics Motor Roundtable | 30 August 2018 | Sebastian Risse
4. Implementation of new Processes using Change Management Techniques: How can we onboard our employees?
33
The 5 Steps of Change Management
World Class Processes:
Claims and Technical Accounting
Business Experts are included during
analysis and solution definition
Project Steering at all organizational
levels
Dry Runs before going live: Test new
processes on existing portfolios
Multi-tiered KPI Definitions
Swiss Re Nordics Motor Roundtable | 30 August 2018 | Sebastian Risse 34
Swiss Re Nordics Motor Roundtable | 30 August 2018 | Sebastian Risse
Legal notice
35
©2018 Swiss Re. All rights reserved. You are not permitted to create any modifications
or derivative works of this presentation or to use it for commercial or other public purposes
without the prior written permission of Swiss Re.
The information and opinions contained in the presentation are provided as at the date of
the presentation and are subject to change without notice. Although the information used
was taken from reliable sources, Swiss Re does not accept any responsibility for the accuracy
or comprehensiveness of the details given. All liability for the accuracy and completeness
thereof or for any damage or loss resulting from the use of the information contained in this
presentation is expressly excluded. Under no circumstances shall Swiss Re or its Group
companies be liable for any financial or consequential loss relating to this presentation.