Igloo Brochure U.S. - Towers Watson
Transcript of Igloo Brochure U.S. - Towers Watson
Igloo Financial modeling software for managing risk
“Igloo off ered us the most fl exible
and transparent risk modeling tool.
What gave us additional confi dence
was that the consultants involved really
knew their way around models and
the insurance industry in general.”
Dan Wilkinson, Head of Risk, Operations and Compliance,
Travelers UK
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The Igloo fi nancial modeling suite is specifi cally designed to enhance understanding of risk within businesses, from simple applications to a corporate level top-down view of a fi nancial enterprise.
It is used by a variety of organizations, including insurers, reinsurers, fi nancial institutions and regulators. Igloo users can quickly see how decisions might impact the risk and performance of their business, and use model outputs to promote a wider understanding of risk within the business.
Igloo is already the insurance industry’s leading modeling platform, noted for its transparency and scalability. The building block approach and the availability of a library of pre-built modules make it fl exible, and easy to use and update. We offer clients guidance in the initial build phase and are available to support your modeling requirements on an ongoing basis.
The three editions of Igloo are designed to meet varying organizational and budget requirements. ICE is the entry-level product for companies seeking to establish a modeling foothold. Igloo Extreme offers the user full customization of the models, while Igloo Enterprise provides users with a distributed solution.
An Audit edition is also available to allow third parties to conduct independent audits of Igloo models.
Property & casualty insurers and reinsurers
are facing growing market and regulatory
pressures to improve risk management.
Igloo is a fi nancial modeling solution
that can help you meet these demands
quickly and eff ectively, promoting a
wider understanding of risk within your
organization.
The fl exibility and control of Igloo is available in three editions, including the Igloo Compact Edition (ICE) for companies wanting a convenient entry point to comprehensive risk modeling.
Towers Watson Igloo
Igloo users can quickly see how decisions might impact the risk and performance of their business, and use model outputs to promote a wider understanding of risk within the business.
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All editions of Igloo are built
on a common set of features
that help take account of the
uncertainties of the real world in
business decisions and forecasting.
Client-centricity
• A rapid model development environment — based on a range of reusable pre-built library modules and/or Igloo’s building-block approach to model components
• Transparency — within Igloo, users can see every formula and investigate intermediate results
• Flexibility — to update and amend specifi c model elements. The Igloo Data Flow diagram and Tree View enable you to keep track of the origin and usage of all variables, and to drill down to any level of detail
• Speed and performance — a number of our clients have benefi ted from huge time savings when moving from alternative modeling systems to Igloo
• Future-proofi ng — the scalability of Igloo means that models can grow with your company
• The ability to generate reports and graphs during the development and analysis of your model
Proven modeling platform
• Many of our clients have used models developed in Igloo to calculate regulatory capital requirements
• Ease of integration — Igloo can accept and use output from third-party catastrophe models and economic scenario generators. It can also be linked to other software packages, such as Microsoft® Excel
• Igloo is trusted and is being used by regulators
Technical effi ciency
• Model nesting — complex model structures can be simplifi ed by nesting models within sub-models
• Distributed updates of standard components and modules
• Does not require knowledge of C++, C# or similar programming languages
• Connects to enterprise databases • Supports international character sets
Advantages of Igloo
Figure 1. Screenshot showing the Gumbel dependency with model inputs
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Using a common building-block approach, the three editions of Igloo are tailored to meet evolving budget, scale and processing requirements with an easy upgrade path.
Igloo Compact Edition
The perceived cost and complexity of integrated risk models has historically proved a barrier to entry for many smaller entities. While addressing these issues, ICE offers huge accuracy, time and effi ciency improvements over the most common alternative — spreadsheet-based models.
Specifi c benefi ts
• Offers standard library modules developed over a number of years
• Enables you to quickly establish a modeling platform, with the assurance that you can seamlessly upgrade to other editions of Igloo if and when you wish
• Reduces the risk of inadvertent errors inherent in using spreadsheet models
• Provides a range of components that can be tailored to your company’s unique needs
• Includes parameterization for the standard modules
Igloo Extreme
The Extreme edition, as well as offering the standard modeling libraries, enables you to create fl exible and sophisticated models that refl ect the uniqueness of your business.
Specifi c benefi ts
All of the benefi ts of the Compact Edition and:
• You are not limited to predefi ned libraries and have complete fl exibility to create your own
• Includes full-model parameterization • Enables optimization of business strategies, e.g., reinsurance purchase
• Can be scaled up, or provide a migration path, to a fully distributed model (Enterprise edition)
Igloo Enterprise
The Enterprise edition can benefi t any organization with a sophisticated model or those companies that want to run a smaller model multiple times with different sets of assumptions. Enterprise edition can be integrated with web-based technologies, database and document management systems. This is particularly helpful for meeting the requirements of risk-based regulatory regimes such as Solvency II.
Specifi c benefi ts
All of the benefi ts of the other two editions, plus:
• Enterprise is a distributed, networked solution • Can be linked to an intranet interface • Supports a stronger governance framework • Maximizes model throughput
Igloo Editions
Standard library modules
To help clients develop models quickly, Igloo comes with a range of built-in library modules:
• Economic scenario generation • Claim modeling, including parameterization • Reinsurance contract modeling and pricing • Reserving, including ranges • Business planning • Financial reporting • Capital setting and allocation • Standard reporting — (QIS) for Solvency II
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What Igloo Delivers
Igloo provides a strong technical
foundation for your fi nancial
models.
Any number of business variables can be modeled together with any required dependencies between them. Igloo has a strong statistical basis and includes a wide range of statistical distributions, a choice of dependency structures between key risk factors and graphic capabilities to visually identify features of your data.
Components are developed using spreadsheet-type formulas, and can be linked together at the click of a mouse. Models can be updated in seconds by
replacing one module with another. And because all Igloo applications are scalable, the software can ease your journey toward models that are as sophisticated as your business requires.
Actuarial Support
Building an accurate and effective model is a complex process. Our actuarial and modeling experts provide as much support as you require throughout the build phase and as you develop your use of Igloo. We provide additional hands-on resources for scoping, building and peer-reviewing models, and insight into issues such as data specifi cation, parameterization and regulatory compliance.
Igloo in Practice
Igloo is licensed by insurance companies and, increasingly, by other
types of fi nancial institutions around the world. It helps them meet a
range of business and compliance objectives.
Much of the discussion about capital models in recent years has focused on compliance issues. While important, for many of our clients, this is only half the story.
In many cases, Igloo is the platform on which to build a more risk-conscious business culture, encompassing capital, assets, liabilities and operations. It also provides the technical analysis to support strategic planning and management.
Towers Watson’s broad actuarial and advisory services are an important part of the package of services offered to Igloo clients, helping not only to build, maintain and improve the fi nancial model, but to support work to embed the cultural changes that true enterprise risk management (ERM) involves.
Igloo has a strong statistical basis and includes a wide range of statistical distributions, a choice of depen-dency structures between key risk factors and graphic capabilities to visually identify features of your data.
Figure 2. Screenshot showing the graphing functionality
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Igloo suite main features
Igloo Compact Edition Igloo Extreme Igloo Enterprise
Standard library module
Transparency of results and calculations
Control over all model variables
Auditable
Ability to integrate with offi ce applications
Connectivity to enterprise and desktop databases
Distributed updates of standard components and modules
Support of international character sets
Suitable for desktop or shared server installations
Supports use of dashboards
Supports creation of dashboards
Create own libraries
Full optimization capability
Linking of multiple projects
Distributed application
Browser-controllable
System monitoring and administration tool
Extended confi guration options
Model run scheduler
Figure 3. Screenshot showing the full screen in split screen mode
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Case Studies
Allianz Since Allianz fi rst licensed Igloo in 2002, it has used it for a range of tasks, including worldwide reinsurance optimization, reserve uncertainty, complex reinsurance covers and natural catastrophe exposure.
More recently, Allianz selected Igloo to develop a common framework for reporting non-life risk and capital requirements in each of its worldwide entities. In addition to continuing with current modeling applications, Allianz is extending the generic model to integrate non-life premium and reserving risks.
By developing this model, the company will provide individual country subsidiaries with a more granular approach to assessing risk and a means for collating business risk information at a global level on a more consistent basis.
Travelers UK Travelers UK selected Igloo to drive wider risk management and strategic planning within the business, while streamlining regulatory capital submissions. With support from outsourced staff, in just six months, it built the initial model to support its regulatory submission for its Lloyd’s syndicate.
In moving from its previous spreadsheet model, within 12 months, Travelers UK had started to utilize what-if scenarios for infl uencing reinsurance purchase decisions and had reduced processing time by a factor of seven. Igloo’s open architecture has also identifi ed avenues for integrating asset management and economic scenario generation analyses that are driven by its U.S. parent company.
The trend for greater risk-based
regulation is gaining momentum
around the world.
Igloo provides an end-to-end solution for meeting the requirements of Solvency II and improving risk-based decision making. It also provides a stronger foundation for relationships with rating agencies.
Igloo is the state-of-the-art tool to help you perform the necessary jobs effectively and future-proof the models used in your compliance function and the business at large. Specifi cally for Solvency II, it can be used to build and embed internal models to meet both the SCR and ORSA requirements. The standard library modules include QIS capital calculations.
While Igloo permits your actuarial and compliance teams to analyze issues to precise levels of detail, the user-friendly reports and graph functionality also give your entire management team easy access to key performance and risk indicators.
ERM Approach
All editions of Igloo, including the Compact, can be uniquely tailored to your business, whether this is done by Towers Watson or by you in-house.
Igloo also supports the development of the business processes and controls that are key to the successful execution of a Solvency II project. For example, it has a full audit facility to enable a user to show that a formula and set of numbers have been checked. Igloo can also interface via ODBC link with the full information architecture of a company, including enterprise-level databases.
More advanced risk management of this nature is increasingly a concern for rating agencies. With Igloo, the internal model you use to make more risk-informed business decisions will help you demonstrate to rating agencies that you are staying on the cutting edge.
Solvency II and ERM
Igloo is already used successfully by many
hundreds of organizations around the world.
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Implementing Models
Towers Watson’s broad mix of
actuarial, project management
and software-related expertise
delivers a range of optional,
value-added services for
the implementation and
development of your models.
Training
Most Igloo clients want their in-house actuaries and compliance teams to be able to do the majority of modeling work and analysis themselves once the model is built. Therefore, training is an important part of model implementation assignments, not only covering use of the software, but techniques that will enable clients to get the most from the model. As clients develop their use of models, we offer options for further software and technical training.
Model design
Our modeling specialists can take a lead or supporting role in the initial design of the model. Many clients continue to work with us to add to their modeling capability — as part of a structured program or on an ad hoc basis.
Bespoke model libraries
While all editions come with standard library modules, we can tailor any of these to your specifi c requirements or create new ones to meet your needs. Extreme and Enterprise edition users have the capability to create new libraries themselves, and Towers Watson can support successful outcomes for these projects.
Peer reviews
Because we work with models every day and invest considerable time in research and development, our consultants are well positioned to advise on the effi ciency of model design and what constitutes market best practice. We also offer an audit service on in-house-developed Igloo models.
IT infrastructure support
We can advise you and work with your in-house IT teams to ensure that your desktops and servers are confi gured to optimize the use of Igloo.
Help desk
All Igloo clients have access to specialist support via our telephone and online help desk.
User forum
Igloo clients can share ideas and learning experiences in user forums that are held in countries with signifi cant numbers of licensees.
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Software Portfolio Towers Watson provides sophisticated risk, analytics and
consulting solutions that help P&C and life insurers meet the
rapidly evolving demands of today’s market.
The acquisition of EMB in 2011 has added signifi cantly to Towers Watson’s software offerings, providing a truly comprehensive portfolio of analytical software. We combine innovative actuarial thinking with software expertise to develop comprehensive solutions that measure value, manage risk and safeguard solvency.
Pricing software
Our range of software tools enables you to plan, manage and optimize your pricing process.Used independently, or alongside our consultancy services, these tools are powerful additions to your business.
• Emblem • Pretium • Classifi er • Rate Assessor • Optimiser • Prism
Financial modeling software
Clients in more than 30 countries — leading P&C and life insurance companies, multinationals, pension funds, mutual funds and asset managers — know that enhanced risk and capital management has become a differentiator for success. That’s why they’ve made our systems an integral part of their business.
• Igloo • MoSes • Risk Agility • Simulum • TAS Tillinghast Actuarial Software • Economic Scenario Generators
Reserving and other insurance software
In addition to industry-leading software that helps companies to run the loss reserving process with speed, ease and fl exibility, we offer specialist analytical software for insurers and reinsurers.
• ResQ • Replica • Repro
Marketing analysis software
Optimize media and advertising spend on defi ned sales and marketing objectives using granular actuarial techniques.
• MediaOptimiser
Copyright © 2011. All rights reserved.NA-2011-19263. February 2011.
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About Towers WatsonTowers Watson is a leading global professional services company that helps organizations improve performance through effective people, risk and fi nancial management. With 14,000 associates around the world, we offer solutions in the areas of employee benefi ts, talent management, rewards, and risk and capital management.
For more information, contact your local Towers Watson offi ce or e-mail us at [email protected].