Enterprise Risk Management Technology Guide 2023

Aptitude Software: Technology to simplify IFRS 17 compliance

Jeremy Marchant, head of international pre-sales at Aptitude Software, discusses post-Covid trends and explains some of the data challenges insurers are facing as they implement IFRS 17

Jeremy MarchantYou have been working with some of the top tier 1 insurers over the last two years and now some of your IFRS 17 projects are approaching the parallel run phase. What trends have you seen over that time?

We now have approximately a dozen clients implementing IFRS 17 and around half of those will have commenced user acceptance testing and/or parallel runs by early 2021.

Generally, it is the largest insurers who are further down the track with IFRS 17 projects, so the typical themes we are seeing at this point are around data sourcing and the integration of actuarial and financial data.

In terms of data sourcing, IFRS 17 requires new calculations, as well as new, granular data sets and groupings. This is particularly true for general insurers adopting the PAA approach, since under the current approach modelling is highly aggregated. However, GMM and VFA users have also faced the need to source all the required data, which is generally held in dispersed systems, and then structure it so the IFRS 17 calculations can be performed.

Many firms have found they do not have the data at the right level of detail and have needed to build new data allocation routines.

We've also noticed that the integration of actuarial and finance data has proven to be a big challenge. Translating actuarial model outputs and other cashflows into accounting concepts has been a major problem in the industry. Finance users typically have specific requirements in terms of the transparency and auditability of reportable numbers. Building this functionality has been an area where some projects have floundered in the last two years.

What Covid-19 impacts have you seen on IFRS 17 projects?

In the last few months, we have seen a genuine split across the market. Many of our tier 1 clients are moving beyond IFRS 17 to focus on finance transformation that will benefit the wider enterprise. We are talking about things like halving the time taken for month-end close, decommissioning legacy front-end systems to centralise functionality and automating reconciliations and controls. For example, some of our clients are targeting 40% of efficiency savings in finance over a two-year payback period.

In contrast, we are seeing smaller tier 2 and tier 3 insurers just coming to market and looking to leverage off-the-shelf solutions to minimise impact on their project teams. Quite naturally in the current environment they are seeking to conserve costs and capital with a focus on compliance-only projects, which retain the transformation option for a later date.

How can Aptitude Software help insurers implement IFRS 17?

We feel the biggest benefits our new clients get is learning from our existing clients. We have been implementing IFRS 17 projects for over two years and the Aptitude IFRS 17 Solution includes all the learnings from these engagements. This means our new clients will not be facing common IFRS 17 challenges for the first time.

At Aptitude, our product philosophy is built on the principle of configuration, not customisation. The Aptitude IFRS 17 Solution is, to a significant extent, pre-configured and works "out-of-the-box".

While there is some tailoring to do on-project to ensure all clients can address the requirements that are unique to them, we typically find that our projects are quicker to deliver than other vendors because of these accelerators – we're already on the second lap from day one of our projects.

Finally, we are well positioned to help those insurers with simpler business models who are expected to commence their IFRS 17 projects in the second half of 2020. What we hear from these insurers is they typically do not have large actuarial and accounting policy teams who have the time to get deep in the weeds on choices to be made under the new standard.

They are also not seeking immediate finance transformation objectives given other, more pressing, business priorities. The pre-built features and accelerators of the Aptitude solution are appealing to these sorts of insurers.

Amanda Steward
T: +44 (0) 203 687 3200
E: [email protected]

Guide entries by Aptitude Software

FactSet Data & Analytics Solutions

Touchstone

Pricing - Tyche Pricing System & Aon Pricing Platform

Reserving - Tyche Reserving System

Aptitude IFRS 17 Solution

Aquantec Ocean

Atidot AI & Analytics Platform - Atidot OPTIMAL

ANNalytica

BW KIDS 4 PRIIPS Tool

SIImplify

With Profits Payout Monitoring Dashboard

Demographic Experience Monitoring Tool

ATOME: Particles

ATOME: Matter

ADVISE® Enterprise Risk Modeler

Conning Allocation Optimizer™

Conning Climate Risk Analyzer™

FIRM® Portfolio Analyzer

GEMS® Economic Scenario Generator

XSG

Detech Optimizer

DEvent

Dynamo Analytics - Psicle

Incisive Essentials - Xcellerator

Integrate

Milliman Mind

ModelSign

Solvency II Compliance Assessment Tool

STAR Solutions NAVI

STAR Solutions VEGA

Milliman Mind–IFRS 17

Arius

Datalytics-Defense

Nodal Claims Triage

Milliman Economic Scenario Generator

Milliman AccuRate Fleet

Milliman Bungalow

Milliman PinPoint

Curv

Milliman Long–term care Advanced Risk Analytics™ (Milliman LARA™)

Milliman M-PIRe Valuation & Securitization Software

AXIS™ Actuarial System

Scenario Generation Solutions

Climate Pathways

RiskIntegrity™ Suite

Oasis Loss Modelling Framework

GLASS

Economic Scenario Generator

Phinsys Insurance Suite

CoMeta

ChemMeta

Matching Adjustment Analytics Tool

R³S Software Suite

Mo.net Model Development Studio

Mo.net Operational Modelling Centre

Mo.net Quotations Service

Mo.net Cloud Modelling Service

Mo.net Mobile Modeller

IFRS Assess Enterprise

SolvencyTool

SolveXia

Governance, Risk & Compliance System

DataValidator

ResQ Financial Reporter

Unify

Igloo

Radar

ResQ

zeb.control

evo-insight - New Actuarial Modelling and Analytical Platform from Zenith

Asseco IFRS 17 Engine

Actuo SII Engine

IFRS17 Solution

Reserving solution

Solvency II solution

Pricing solution

CLARA Casualty Claim Platform (CLARA Triage, CLARA Treatment, CLARA Litigation, CLARA MSP Compliance, CLARA Optics)

Portfolio Manager

JBA Flood Modelling Technology

IFRS Assess and Risk Analyser

Numerix Insurance Suite

PATOne EDM

Quantee Platform

On-Demand CAT Modelling Services on the Oasis Platform

Graci

Riskonnect

FE Solvency II

Grace Connect GRC Suite

Monitaur

DeepCyc

ForeCyc

Metryc

Escali Financials and Escali Supervision

CALFITEC

Quotech Underwriters Workbench

FIS Insurance Risk Suite (formerly known as Prophet)

LCP InsurSight

SS&C Algorithmics for Insurance

True North Data Platform

Balance Sheet Management (BSM)

Economic Scenario Generation (ESG)

MavenBlue Enterprise Pricing Management (EPM)

Optalitix Models and Optalitix Quote

Montoux Actuarial Automation Platform

Iris Actuarial Platform

CyberCube Analytics - Portfolio Manager

R³S Model Packages

R³S Modeler

R³S Process Manager

R³S Development Manager

Decision Focus

Fathom's Product Stack

Capital - Tyche Capital Model & ReMetrica

Incisive Essentials - Concourse

VIPR INTARGA

VIPR Insights - Data Analytics

Zupervise

Protecht ERM

Slope Software

Camms GRC Software

Quantee next-generation insurance pricing platform powered by AI

Oversight360, a Sicsic Solution

RISKflo

End User Computing (EUC) and Model Risk Management Software with Inventory, Discovery and Monitoring Modules

XLAudit Spreadsheet Error Analysis and Data Integrity Software

ClimateMAPS

Financial Results Analyzer

Risk Explorer™

RiskAgility FM IFRS 17 Calculation Engine

Predictable Dynamics

Res-Solver™

RiskAgility Financial Modeller