Requirements of the Solvency II regulatory framework are often divided into three pillars similar to the Basel II banking regulations: Pillar 1 – quantitative requirements – defines the calculations (the standard formula or an internal model approved by a supervisor) and requirements for data quality, auditability and traceability. Pillar 2 – qualitative requirements – sets out requirements for the governance and risk management of insurers including Own Risk and Solvency Assessment (ORSA). Pillar 3 – disclosure and transparency requirements – focuses mainly on supervisory reporting and public disclosure. In a practical sense, there are two basic, and inevitable, technical impacts for insurers. The first is the obligation to assemble an economic balance sheet and to calculate the standard formula to determine solvency capital requirements and the solvency ratio (that belongs to Pillar 1). The second impact is the obligation to fulfill regulatory reporting requirements that are defined by QRT (Quantitative Reporting Templates – belong to Pillar 3). Customer Intelligence Solutions All data needed for Solvency II calculations are gathered in the Data Storage, as well as partial results of all computational steps. A data transfer from the available IT systems is the preferred way of how to get input information for Solvency II calculations. Data are transferred to the raw data area of the data storage and then transformed to the target Solvency II data model. All inputs are handled by ETL (Extract & Transformation & Load) processes and monitored for data quality. In a perfect world, all information needed for Solvency II calculations would be obtained this way. In actuality, some data may not be available in IT systems, or their proper processing may be too demanding. In this case, audited Manual Inputs is the next best choice. The data are not transferred from systems, but treated manually and saved in the raw data area. Manual data inputs should follow strict rules and workflow. Actuarial Tools and the Standard Formula Calculator read the input data from the Data Storage, perform calculations and then write back the results. Afterwards all necessary data are ready to be reported. The Solvency II regulatory framework calls for a change in behavior of insurers and for a new attitude to risk management. Compliance with Solvency II requirements may have a strong influence on the basic operations of an insurance company, starting from the management system, organizational structure or process adjustments, and ending with product definition, reinsurance set-up or asset management. Explicit definitions of solvency calculations and supervisory reporting combined with demands to data quality and auditability are a vast challenge for IT. Solvency II mandatory calculations and reporting System Inputs Transfer of data available in IT systems Raw Data Transformed & Calculated Data Data Storage Reporting QRT and customized reports Manual Inputs Audited input of data not available in IT systems SF Calculator SII standard formula calculator and browser Actuarial Tools Tools implementing various actuarial methods Extensive demands for calculations and reporting, together with requirements for a systemic approach and data traceability from inputs to outputs, make an appropriate IT solution quite challenging. Our approach to solving these issues is briefly summarized in the following picture:
Transcript
Requirements of the Solvency II regulatory framework are often divided into three pillars similar to theBasel II banking regulations:Pillar 1 – quantitative requirements – defines the calculations (the standard formula or an internal model
approved by a supervisor) and requirements for data quality, auditability and traceability.Pillar 2 – qualitative requirements – sets out requirements for the governance and risk management
of insurers including Own Risk and Solvency Assessment (ORSA).Pillar 3 – disclosure and transparency requirements – focuses mainly on supervisory reporting and
public disclosure.
In a practical sense, there are two basic, and inevitable, technical impacts for insurers. The first is theobligation to assemble an economic balance sheet and to calculate the standard formula to determinesolvency capital requirements and the solvency ratio (that belongs to Pillar 1). The second impact is theobligation to fulfill regulatory reporting requirements that are defined by QRT (Quantitative ReportingTemplates – belong to Pillar 3).
C u s t o m e r I n t e l l i g e n c e S o l u t i o n s
All data needed for Solvency II calculations aregathered in the Data Storage, as well as partialresults of all computational steps.
A data transfer from the available IT systems isthe preferred way of how to get input informationfor Solvency II calculations. Data are transferredto the raw data area of the data storage and thentransformed to the target Solvency II data model.All inputs are handled by ETL (Extract &Transformation & Load) processes and monitoredfor data quality. In a perfect world, all informationneeded for Solvency II calculations would beobtained this way.
In actuality, some data may not be available in ITsystems, or their proper processing may be toodemanding. In this case, audited Manual Inputs isthe next best choice. The data are not transferredfrom systems, but treated manually and saved inthe raw data area. Manual data inputs shouldfollow strict rules and workflow.
Actuarial Tools and the Standard FormulaCalculator read the input data from the DataStorage, perform calculations and then write backthe results. Afterwards all necessary data areready to be reported.
The Solvency II regulatory framework calls for a change in behavior of insurers and for a newattitude to risk management. Compliance with Solvency II requirements may have a stronginfluence on the basic operations of an insurance company, starting from the management
system, organizational structure or process adjustments, and ending with product definition,reinsurance set-up or asset management. Explicit definitions of solvency calculations
and supervisory reporting combined with demands to data quality and auditabilityare a vast challenge for IT.
Solvency IImandatory calculations and reporting
System Inputs
Transfer of dataavailable
in IT systems
RawData
Transformed& Calculated
Data
Data Storage Reporting
QRT andcustomizedreportsManual Inputs
Audited inputof data not available
in IT systems
SF Calculator
SII standardformula calculator
and browser
Actuarial Tools
Tools implementingvarious actuarial
methods
Extensive demands for calculations and reporting, together with requirements for a systemic approachand data traceability from inputs to outputs, make an appropriate IT solution quite challenging. Ourapproach to solving these issues is briefly summarized in the following picture:
Data processing and reporting
Solvency II requirements for obligatory reporting aredefined by QRT (Quantitative Reporting Templates).Very roughly divided, there are two kinds of figures inthese reports – those that report the standard formula(and are submitted to the Data Storage by theStandard Formula Calculator) and those that are nota part of the standard formula calculation (and haveto be maintained in the Data Storage in addition). Inother words – QRT demand more complexinformation to be stored in the Data Storage than theinformation needed for the standard formulacomputation.
Technically there are at least three basic questionsconcerning data processing and reporting:How to implement the Data Storage?How to get all necessary information into the DataStorage?What technology should be used to deploy thereporting over the Data Storage?
Our belief is that the answers to these questionsshould reflect the overall situation of an insurancecompany and should follow its IT architecture.Therefore, we believe that a customized IT projectbased on preferred technologies is the most suitableapproach to finding a satisfactory solution that willhave adequate maintenance in the future.
The implementation of the Data Storage andoverlaying reporting is, essentially, the deploymentof our general Solvency II logical data model andreporting templates on selected technologies.Adastra, as a supplier, is technologically independentand supports all major database technologies as wellas reporting and BI tools.
The task of filling the Data Storage with the requiredset of data is far more demanding. It has to reflectthe individual system set-up of the insurancecompany in question. A detailed description of alldata needed as inputs for all actuarial tools, theStandard Formula Calculator and QRT reports that wesupply together with our Solvency II data model acts,in fact, as the definition of a specific IT project thatdeals with the input data. The project should beginwith an analytical phase to define the exact scope ofthe implementation part of the project.
Successful implementationof Solvency II calculations
We believe that a comprehensive set of tools,together with well-trained specialists – actuaries andbusiness/IT consultants – are key ingredients ofsuccessful implementation of Solvency II calculations.
Our tools and templates are the result of long termdevelopment. A team of senior actuaries, insurancebusiness consultants and IT specialists stands besidethe creation of the tools. We are ready to deliver notonly the tools, but also the know-how needed toprepare the input data and to fully understand allaspects of Solvency II or other related actuarialcalculations. We can deliver a complete tailor-madesolution as well as supply the missing pieces to thepuzzle of your Solvency II solution.
The described approach solves the mandatorySolvency II calculations and data processing fromA to Z. The proposed architecture can be extended bya partial or a full internal model and/or other usefulactuarial calculations and/or comprehensive internalcorporate reporting allowing the customer to achievemore business value from the considerableinvestment made in mandatory Solvency IIcalculations.
The overview of tasks needed to fulfillSolvency II mandatory calculations andreporting:
value of life liabilities and its stressingvalue of non-life liabilities and its stressingvalue of financial instruments and itsstressingyield curve fittinggeneration of economic scenariosassembling of economic balance sheetevaluation of own fundsstandard formula SCR calculationMCR calculationconsistent data storageautomation of data processingdealing the data quality and auditabilityQRT implementation
Do you have all these points covered? Dothose pieces work together? Are you ready tobuild an effective risk management solutionabove it?
Who we are and what makes our offer unique?We are a joint venture of the large international consultancy company and the dynamic actuarialfirm with the unique know-how. We are actuaries, business and IT consultants, who have puta significant effort into development of a real-world Solvency II solution.
Our solution covers:Actuarial Tools– Sophas– Claims Reserve Calculator– Asset Model– Yield Curve Fitting– ESG – Yield Curve Simulation– ESG – Yield Curve CalibrationStandard Formula CalculatorComplete description of input dataMapping to QRT reportsLogical data model that glues all parts togetherDeployment of the data storage and reports on preferred technologiesIT and actuary consultations dealing with your individual situation
Our solution is modular, so we are able to deliver it whole or just the parts you need. We cover allaspects of Solvency II calculations and we can mix a package of tools and services to suit your needs.
Adastra Business Consulting, s.r.o.Nile House, Karolinská 654/2186 00 Praha 8 – KarlínCzech RepublicTel.: +420 271 733 [email protected]
Actuarial Tools
Elaboration of the standard formula calculationinvolves a lot of inputs which can only be producedusing specific calculation tools (e.g. best estimate/fairvalue of liabilities/assets and their stresses etc.). Ourexperience shows companies lacking actuarial tools,especially in inadequate verification anddocumentation, and, frequently, a poor user interfacevulnerable to operation risks.
This is why we have created and offer a set ofactuarial tools which are always:
prepared by experienced actuaries who aretheoretically well-versedvalidated independently by senior actuariesfully documented featuring a User Guidedescribing how to use the tool and including allthe actuarial principles involved as well as aninteractive help optioncommunicating via a well-designed free to
operation risk interface.
In this section, we mention several useful actuarialtools which can help you in the SII calculation process.
Value of life liabilitiesSolvency II calculations require the company todeliver the best estimate/fair value of life liabilitiesincluding their stresses (e.g. for market risk orunderwriting risk). The calculation of these valuesrequires detailed cash flow projections and stochasticscenario applications. It is very demanding for the SWcapability to be run in an acceptable time period.
For this purpose, we offer Sophas, a professionalactuarial system that is specifically prepared to createrobust and fast running cash flow models usedprimarily for life liability value calculations – includingdeterministic and stochastic ones – in a user-friendlyenvironment.
Non-life liabilitiesValues of the non-life liabilities (especially the claimsreserves) are usually determined using developmenttriangles. A Claims Reserve Calculator coversa variety of chain-ladder methods and offers manyanalytical features for easy and straightforwardcalculations and results verification.
Where a calculation based on individual (non-aggregated) data is more relevant (e.g. where theclaims volatility is high and where reinsurance andcover limits are important) we can also provide youwith a tailor made models applying deterministic aswell as stochastic approach.
The value of financial instrumentsand their stress testingWe offer the Asset Model tool which allows you tocalculate and stress the market values of financialinstruments (e.g. for the purpose of the market riskcalculation) and project monthly developments ofcorresponding variables (cash flows, market values,amortized costs, accrued interests and other bookfigures, PL and BS and other reporting figures,duration, convexity and other assets characteristics,yield indicators, etc.).
Since the calculation of the above-mentioned figuresneeds at least the current yield curve (typically therisk free) and its simulation using an economicscenario generator (ESG) we also offer the followingtools:
Yield Curve FittingYield Curve Fitting tool generates the portfolio yieldcurve based on market data (price, yield to maturity,etc.) of the relevant (typically “risk free”) assets.
Economic Scenario Generatora) ESG – Yield Curve Simulation is an applicationdesigned to provide you with risk neutral interestrate scenarios applying approved techniquesoptimized for short run-time and includingsophisticated features improving the speed ofconvergence of the follow-up actuarial calculations
b) ESG – Yield Curve Calibration – calibratedparameters to be used in the simulation tool(ESG – Yield Curve Simulation) are the results ofthis tool.
As a supplement to all of these tools, the ActuarialFunctions add-in to MS Excel, which lets you easilycreate actuarial figures (in a form of functions), isavailable.
Standard Formula Calculator
The Standard Formula Calculator assembles theeconomic balance sheet and computes the own fundson the one hand, on the other it computes values forall risks required by the standard formula thuscompleting solvency capital requirements. Minimumcapital requirements and resulting solvency ratios areevaluated too, of course.
The calculator has defined sets of inputs and outputs.Both inputs and outputs are supposed to be stored inthe Data Storage and can be read/written directlyfrom/to the database. Communication via text files isavailable too. Inputs have a level of granularity thatkeeps all computations traceable and consistentwithin the calculator. Outputs are defined in a mannerthat is compliant with QRT reports. This means thatfigures related to the standard formula demanded byQRT are submitted by the calculator. Moreover, anenhanced set of items can be returned by thecalculator, if needed.
There are three modes of usage of the calculator:Preview mode – the input data is read by the calculator from the Data Storage without saving results. Thenall inputs, partial and final results can be seen and browsed. Thus, the entire standard formula is superblyvisualized, showing “the story” from inputs to outputs and enabling the user to check all the figures.
Calculation mode – writes results back to the database or saves them to text files. In this mode thecalculator acts as a pure calculation engine or an external module, seen from the viewpoint of the DataStorage.
Free mode – enables the user to save the standard formula as a standalone MS Excel file. This file containsthe input data, has no connection to the Data Storage and can be freely edited making it a perfect tool forsensitivity analysis within the standard formula.
Overall the Standard Formula Calculator is a simple, comfortable tool providing clearly defined and auditablecalculations. It enables input data verification in the context of the standard formula and browsing through allpartial results. Moreover there is the possibility of additional sensitivity analysis.
Are the tools everything you need for Solvency II calculations?The Actuarial Tools provide a bunch of sophisticated calculations. They arethe heart of Solvency II. The value of life and non-life liabilities, the value offinancial instruments and a related set of stressed values are the basicfigures with a crucial effect on the value of own funds, SCR and resultingsolvency ratios. The creation of proper models within the tools is a seriousstuff for advanced actuaries. Running these models is very demanding interms of computation time, mainly in the case of life liabilities and theirstressing.
The Standard Formula Calculator collects the figures from Actuarial Tools andadds more calculations to evaluate the own funds, SCR, MCR and solvencyratios. Though particular calculations within the calculator may not be assophisticated as those in the Actuarial Tools, all together they form anextensive complex that smartly solves a huge conglomeration of the SCR“spider”. All substantial figures of Solvency II calculations can be found inthe calculator.
Is Solvency II finished at this point? Definitely no.
Here is just where IT stuff actually begins:to collect the data needed as inputsto save them in a proper form together with partial results of successivecalculationsto put together the final data set for QRT reportsto implement the reports themselvesto create an automated computation process that will be run periodicallyin the futureto set up the workflow of this process which consists of manyheterogenous tasksto minimize a human factor in the processto deal the data qualityto ensure the data lineage – the ability to declare a proper flow of thedata among the calculations from inputs to outputs
Addressing these issues might be even more demanding than the preparationof Solvency II calculations on their own. The final IT solution asks furthermore than ad-hoc Solvency II computation on ad-hoc collected data.
Actuarial Tools
Elaboration of the standard formula calculationinvolves a lot of inputs which can only be producedusing specific calculation tools (e.g. best estimate/fairvalue of liabilities/assets and their stresses etc.). Ourexperience shows companies lacking actuarial tools,especially in inadequate verification anddocumentation, and, frequently, a poor user interfacevulnerable to operation risks.
This is why we have created and offer a set ofactuarial tools which are always:
prepared by experienced actuaries who aretheoretically well-versedvalidated independently by senior actuariesfully documented featuring a User Guidedescribing how to use the tool and including allthe actuarial principles involved as well as aninteractive help optioncommunicating via a well-designed free to
operation risk interface.
In this section, we mention several useful actuarialtools which can help you in the SII calculation process.
Value of life liabilitiesSolvency II calculations require the company todeliver the best estimate/fair value of life liabilitiesincluding their stresses (e.g. for market risk orunderwriting risk). The calculation of these valuesrequires detailed cash flow projections and stochasticscenario applications. It is very demanding for the SWcapability to be run in an acceptable time period.
For this purpose, we offer Sophas, a professionalactuarial system that is specifically prepared to createrobust and fast running cash flow models usedprimarily for life liability value calculations – includingdeterministic and stochastic ones – in a user-friendlyenvironment.
Non-life liabilitiesValues of the non-life liabilities (especially the claimsreserves) are usually determined using developmenttriangles. A Claims Reserve Calculator coversa variety of chain-ladder methods and offers manyanalytical features for easy and straightforwardcalculations and results verification.
Where a calculation based on individual (non-aggregated) data is more relevant (e.g. where theclaims volatility is high and where reinsurance andcover limits are important) we can also provide youwith a tailor made models applying deterministic aswell as stochastic approach.
The value of financial instrumentsand their stress testingWe offer the Asset Model tool which allows you tocalculate and stress the market values of financialinstruments (e.g. for the purpose of the market riskcalculation) and project monthly developments ofcorresponding variables (cash flows, market values,amortized costs, accrued interests and other bookfigures, PL and BS and other reporting figures,duration, convexity and other assets characteristics,yield indicators, etc.).
Since the calculation of the above-mentioned figuresneeds at least the current yield curve (typically therisk free) and its simulation using an economicscenario generator (ESG) we also offer the followingtools:
Yield Curve FittingYield Curve Fitting tool generates the portfolio yieldcurve based on market data (price, yield to maturity,etc.) of the relevant (typically “risk free”) assets.
Economic Scenario Generatora) ESG – Yield Curve Simulation is an applicationdesigned to provide you with risk neutral interestrate scenarios applying approved techniquesoptimized for short run-time and includingsophisticated features improving the speed ofconvergence of the follow-up actuarial calculations
b) ESG – Yield Curve Calibration – calibratedparameters to be used in the simulation tool(ESG – Yield Curve Simulation) are the results ofthis tool.
As a supplement to all of these tools, the ActuarialFunctions add-in to MS Excel, which lets you easilycreate actuarial figures (in a form of functions), isavailable.
Standard Formula Calculator
The Standard Formula Calculator assembles theeconomic balance sheet and computes the own fundson the one hand, on the other it computes values forall risks required by the standard formula thuscompleting solvency capital requirements. Minimumcapital requirements and resulting solvency ratios areevaluated too, of course.
The calculator has defined sets of inputs and outputs.Both inputs and outputs are supposed to be stored inthe Data Storage and can be read/written directlyfrom/to the database. Communication via text files isavailable too. Inputs have a level of granularity thatkeeps all computations traceable and consistentwithin the calculator. Outputs are defined in a mannerthat is compliant with QRT reports. This means thatfigures related to the standard formula demanded byQRT are submitted by the calculator. Moreover, anenhanced set of items can be returned by thecalculator, if needed.
There are three modes of usage of the calculator:Preview mode – the input data is read by the calculator from the Data Storage without saving results. Thenall inputs, partial and final results can be seen and browsed. Thus, the entire standard formula is superblyvisualized, showing “the story” from inputs to outputs and enabling the user to check all the figures.
Calculation mode – writes results back to the database or saves them to text files. In this mode thecalculator acts as a pure calculation engine or an external module, seen from the viewpoint of the DataStorage.
Free mode – enables the user to save the standard formula as a standalone MS Excel file. This file containsthe input data, has no connection to the Data Storage and can be freely edited making it a perfect tool forsensitivity analysis within the standard formula.
Overall the Standard Formula Calculator is a simple, comfortable tool providing clearly defined and auditablecalculations. It enables input data verification in the context of the standard formula and browsing through allpartial results. Moreover there is the possibility of additional sensitivity analysis.
Are the tools everything you need for Solvency II calculations?The Actuarial Tools provide a bunch of sophisticated calculations. They arethe heart of Solvency II. The value of life and non-life liabilities, the value offinancial instruments and a related set of stressed values are the basicfigures with a crucial effect on the value of own funds, SCR and resultingsolvency ratios. The creation of proper models within the tools is a seriousstuff for advanced actuaries. Running these models is very demanding interms of computation time, mainly in the case of life liabilities and theirstressing.
The Standard Formula Calculator collects the figures from Actuarial Tools andadds more calculations to evaluate the own funds, SCR, MCR and solvencyratios. Though particular calculations within the calculator may not be assophisticated as those in the Actuarial Tools, all together they form anextensive complex that smartly solves a huge conglomeration of the SCR“spider”. All substantial figures of Solvency II calculations can be found inthe calculator.
Is Solvency II finished at this point? Definitely no.
Here is just where IT stuff actually begins:to collect the data needed as inputsto save them in a proper form together with partial results of successivecalculationsto put together the final data set for QRT reportsto implement the reports themselvesto create an automated computation process that will be run periodicallyin the futureto set up the workflow of this process which consists of manyheterogenous tasksto minimize a human factor in the processto deal the data qualityto ensure the data lineage – the ability to declare a proper flow of thedata among the calculations from inputs to outputs
Addressing these issues might be even more demanding than the preparationof Solvency II calculations on their own. The final IT solution asks furthermore than ad-hoc Solvency II computation on ad-hoc collected data.
Requirements of the Solvency II regulatory framework are often divided into three pillars similar to theBasel II banking regulations:Pillar 1 – quantitative requirements – defines the calculations (the standard formula or an internal model
approved by a supervisor) and requirements for data quality, auditability and traceability.Pillar 2 – qualitative requirements – sets out requirements for the governance and risk management
of insurers including Own Risk and Solvency Assessment (ORSA).Pillar 3 – disclosure and transparency requirements – focuses mainly on supervisory reporting and
public disclosure.
In a practical sense, there are two basic, and inevitable, technical impacts for insurers. The first is theobligation to assemble an economic balance sheet and to calculate the standard formula to determinesolvency capital requirements and the solvency ratio (that belongs to Pillar 1). The second impact is theobligation to fulfill regulatory reporting requirements that are defined by QRT (Quantitative ReportingTemplates – belong to Pillar 3).
C u s t o m e r I n t e l l i g e n c e S o l u t i o n s
All data needed for Solvency II calculations aregathered in the Data Storage, as well as partialresults of all computational steps.
A data transfer from the available IT systems isthe preferred way of how to get input informationfor Solvency II calculations. Data are transferredto the raw data area of the data storage and thentransformed to the target Solvency II data model.All inputs are handled by ETL (Extract &Transformation & Load) processes and monitoredfor data quality. In a perfect world, all informationneeded for Solvency II calculations would beobtained this way.
In actuality, some data may not be available in ITsystems, or their proper processing may be toodemanding. In this case, audited Manual Inputs isthe next best choice. The data are not transferredfrom systems, but treated manually and saved inthe raw data area. Manual data inputs shouldfollow strict rules and workflow.
Actuarial Tools and the Standard FormulaCalculator read the input data from the DataStorage, perform calculations and then write backthe results. Afterwards all necessary data areready to be reported.
The Solvency II regulatory framework calls for a change in behavior of insurers and for a newattitude to risk management. Compliance with Solvency II requirements may have a stronginfluence on the basic operations of an insurance company, starting from the management
system, organizational structure or process adjustments, and ending with product definition,reinsurance set-up or asset management. Explicit definitions of solvency calculations
and supervisory reporting combined with demands to data quality and auditabilityare a vast challenge for IT.
Solvency IImandatory calculations and reporting
System Inputs
Transfer of dataavailable
in IT systems
RawData
Transformed& Calculated
Data
Data Storage Reporting
QRT andcustomizedreportsManual Inputs
Audited inputof data not available
in IT systems
SF Calculator
SII standardformula calculator
and browser
Actuarial Tools
Tools implementingvarious actuarial
methods
Extensive demands for calculations and reporting, together with requirements for a systemic approachand data traceability from inputs to outputs, make an appropriate IT solution quite challenging. Ourapproach to solving these issues is briefly summarized in the following picture:
Data processing and reporting
Solvency II requirements for obligatory reporting aredefined by QRT (Quantitative Reporting Templates).Very roughly divided, there are two kinds of figures inthese reports – those that report the standard formula(and are submitted to the Data Storage by theStandard Formula Calculator) and those that are nota part of the standard formula calculation (and haveto be maintained in the Data Storage in addition). Inother words – QRT demand more complexinformation to be stored in the Data Storage than theinformation needed for the standard formulacomputation.
Technically there are at least three basic questionsconcerning data processing and reporting:How to implement the Data Storage?How to get all necessary information into the DataStorage?What technology should be used to deploy thereporting over the Data Storage?
Our belief is that the answers to these questionsshould reflect the overall situation of an insurancecompany and should follow its IT architecture.Therefore, we believe that a customized IT projectbased on preferred technologies is the most suitableapproach to finding a satisfactory solution that willhave adequate maintenance in the future.
The implementation of the Data Storage andoverlaying reporting is, essentially, the deploymentof our general Solvency II logical data model andreporting templates on selected technologies.Adastra, as a supplier, is technologically independentand supports all major database technologies as wellas reporting and BI tools.
The task of filling the Data Storage with the requiredset of data is far more demanding. It has to reflectthe individual system set-up of the insurancecompany in question. A detailed description of alldata needed as inputs for all actuarial tools, theStandard Formula Calculator and QRT reports that wesupply together with our Solvency II data model acts,in fact, as the definition of a specific IT project thatdeals with the input data. The project should beginwith an analytical phase to define the exact scope ofthe implementation part of the project.
Successful implementationof Solvency II calculations
We believe that a comprehensive set of tools,together with well-trained specialists – actuaries andbusiness/IT consultants – are key ingredients ofsuccessful implementation of Solvency II calculations.
Our tools and templates are the result of long termdevelopment. A team of senior actuaries, insurancebusiness consultants and IT specialists stands besidethe creation of the tools. We are ready to deliver notonly the tools, but also the know-how needed toprepare the input data and to fully understand allaspects of Solvency II or other related actuarialcalculations. We can deliver a complete tailor-madesolution as well as supply the missing pieces to thepuzzle of your Solvency II solution.
The described approach solves the mandatorySolvency II calculations and data processing fromA to Z. The proposed architecture can be extended bya partial or a full internal model and/or other usefulactuarial calculations and/or comprehensive internalcorporate reporting allowing the customer to achievemore business value from the considerableinvestment made in mandatory Solvency IIcalculations.
The overview of tasks needed to fulfillSolvency II mandatory calculations andreporting:
value of life liabilities and its stressingvalue of non-life liabilities and its stressingvalue of financial instruments and itsstressingyield curve fittinggeneration of economic scenariosassembling of economic balance sheetevaluation of own fundsstandard formula SCR calculationMCR calculationconsistent data storageautomation of data processingdealing the data quality and auditabilityQRT implementation
Do you have all these points covered? Dothose pieces work together? Are you ready tobuild an effective risk management solutionabove it?
Who we are and what makes our offer unique?We are a joint venture of the large international consultancy company and the dynamic actuarialfirm with the unique know-how. We are actuaries, business and IT consultants, who have puta significant effort into development of a real-world Solvency II solution.
Our solution covers:Actuarial Tools– Sophas– Claims Reserve Calculator– Asset Model– Yield Curve Fitting– ESG – Yield Curve Simulation– ESG – Yield Curve CalibrationStandard Formula CalculatorComplete description of input dataMapping to QRT reportsLogical data model that glues all parts togetherDeployment of the data storage and reports on preferred technologiesIT and actuary consultations dealing with your individual situation
Our solution is modular, so we are able to deliver it whole or just the parts you need. We cover allaspects of Solvency II calculations and we can mix a package of tools and services to suit your needs.
Adastra Business Consulting, s.r.o.Nile House, Karolinská 654/2186 00 Praha 8 – KarlínCzech RepublicTel.: +420 271 733 [email protected]
