2006 General Meeting Assemblée générale 2006 Chicago, Illinois 2006 General Meeting Assemblée générale 2006 Chicago, Illinois Canadian Institute of Actuaries Canadian Institute of Actuaries L’Institut canadien des actuaires L’Institut canadien des actuaires

2006 General Meeting Assemblée générale General Meeting Assemblée générale 2006 Canadian Institute of Actuaries New Business Process Efficiencies Jym Barnes

2006 General Meeting Assemblée générale General Meeting Assemblée générale 2006 Introduction 1986 became very interested in the Internet –Seamless integration system to system & device to device –Saw the Internet as a power grid Every business process possible connected through the power grid –Purchasing an item online and tracking the shipping –Scheduling a trip –Later known as Straight Through Processing or STP Digital thread Holy grail of workflow 1996 came to the insurance industry by accident –Infatuated with STP Underwriting in the family blood

2006 General Meeting Assemblée générale General Meeting Assemblée générale 2006 Straight Through Processing (STP) Data passing from one business process to another independent of computer system, organization, country, etc. A digital thread through intermediate business transactions to complete some overall transaction

2006 General Meeting Assemblée générale General Meeting Assemblée générale 2006 UW Unusual Characteristics Perfect example of the power grid concept Many independent stakeholders involved in an underwriting decision (transaction) –Distributors –Outsource providers –Paramedical companies –MIB –Labs –MVR Providers – other evidence providers –APS Providers –Physicians –Reinsurers –Carriers

2006 General Meeting Assemblée générale General Meeting Assemblée générale 2006 Underwriting Issues Shortage of underwriters Completely disconnected processes –Expensive –Long Same data captured multiple times Limited management information

2006 General Meeting Assemblée générale General Meeting Assemblée générale 2006 STP in the new business process is a difficult problem with huge upside if solved!

2006 General Meeting Assemblée générale General Meeting Assemblée générale 2006 What is needed? Faster cycle times Lower cost of processing a case Provide as good or better assessment of the risk Provide ability to better understand the risk –Real-time –Historic management information

2006 General Meeting Assemblée générale General Meeting Assemblée générale 2006 Two concepts to solve this problem Digital thread from app entry through issue into historic risk analysis –Structured data (information) passed –Enriched during each step along the way Extensive underwriting rules available at every point throughout the process

2006 General Meeting Assemblée générale General Meeting Assemblée générale 2006 Digital thread Structured data –eXtensible Markup Language (XML) –Metadata –Information

2006 General Meeting Assemblée générale General Meeting Assemblée générale 2006 Information, defined as knowledge in communicable form

2006 General Meeting Assemblée générale General Meeting Assemblée générale 2006 What is XML? XML is the language for data on the Internet –What does that mean for a life carrier? Also known as Meta-data or structured data Provides the opportunity to turn data into information

2006 General Meeting Assemblée générale General Meeting Assemblée générale 2006 James Robinson Barnes 111 Clear Meadow Dr Ballwin, MO 63011

2006 General Meeting Assemblée générale General Meeting Assemblée générale 2006 James Robinson Barnes 111 Clear Meadows Ballwin MO 63011

2006 General Meeting Assemblée générale General Meeting Assemblée générale 2006 XML Value Simple yet an incredibly important building block Easier connectivity becomes possible Plug-n-play becomes possible Internet is what makes XML even more valuable

2006 General Meeting Assemblée générale General Meeting Assemblée générale 2006 Partial solution XML is only part of the solution How do we know what to tag the information with?

2006 General Meeting Assemblée générale General Meeting Assemblée générale 2006 Underwriting rules are the key to generating meaningful XML!!

2006 General Meeting Assemblée générale General Meeting Assemblée générale 2006 Underwriting Rules Questions and reflexive questions –Scripts Extensive data dictionaries –Impairments, medicines, occupations, aliases Decisions – ratings – flat extras Requirements ordering Workflow logic Build – age/coverage Labs, MIB, MVR analysis

2006 General Meeting Assemblée générale General Meeting Assemblée générale 2006 If you don’t have a rule for the data entered significant value is lost!

2006 General Meeting Assemblée générale General Meeting Assemblée générale 2006 Example Do you have asthma –How many attacks do you have per month 0 – 3 –Do you use tobacco 4 – 7 –Do you use tobacco 8 – 9999 –Do you use tobacco

2006 General Meeting Assemblée générale General Meeting Assemblée générale 2006 XML Generated Asthma Respiratory yes severe

2006 General Meeting Assemblée générale General Meeting Assemblée générale 2006 Enrichment Rules turn data into information Rules then turn the information into actions and more information And so on and so on

2006 General Meeting Assemblée générale General Meeting Assemblée générale 2006 XML Generated Asthma Respiratory yes severe

2006 General Meeting Assemblée générale General Meeting Assemblée générale 2006 XML Enriched RUW APS (Pulmonary Function Test

2006 General Meeting Assemblée générale General Meeting Assemblée générale 2006 XML Enriched SeniorUW 5 days 1 day>

2006 General Meeting Assemblée générale General Meeting Assemblée générale 2006 Rules are involved everywhere UW Rules MIB Labs Rules Administration Call Center Work Flow Management Information Reflexive Questions Correspondence E-app Underwriter Workbench

2006 General Meeting Assemblée générale General Meeting Assemblée générale 2006 Historic Management Information All XML stored for later reporting Demographics Impairment analysis Requirement analysis Decision analysis Trend analysis Ability to combine with claims What if scenarios

2006 General Meeting Assemblée générale General Meeting Assemblée générale 2006 Components of the solution Digital thread through the new business process XML is the key ingredient to make a digital thread possible Extensive underwriting rules necessary to create meaningful XML

2006 General Meeting Assemblée générale General Meeting Assemblée générale 2006 Where are we at today? MIB supports XML LabOne supports XML Several administration system vendors support XML Several illustration system vendors support XML Underwriting system vendors support XML

2006 General Meeting Assemblée générale General Meeting Assemblée générale 2006 Tomorrow? The opportunity exists today to connect a majority of the new business components and stakeholders using XML A digital thread throughout the new business process is within sight Some companies are further along than others in implementing STP –A vast majority are moving in this direction

2006 General Meeting Assemblée générale General Meeting Assemblée générale 2006 Every new solution must connect to every other solution or it will be your next problem!

2006 General Meeting Assemblée générale General Meeting Assemblée générale 2006 Q & A

2006 General Meeting Assemblée générale General Meeting Assemblée générale 2006 Contact Info: Jym Barnes