Streamline the interface between finance and actuarial to create an integrated insurance accounting process.
Innovation Project Description:
Our private lives are dominated by digitalization and an inherent expectation that information is provided immediately and in a way that is tailored to our personal needs. However our experience in the workplace is very different.
If we consider the finance function, our wish is to provide instant insight. Our reality is that we are faced with a legacy system landscape that is often slow, error prone and needs lengthy manual interaction followed by painful reconciliation processes. In particular the interface between finance and actuarial is generally not streamlined and creates a break in what should be an integrated process with a high level of understanding on both sides.
A problem today - which could become even more pronounced with the shift to IFRS 17 – is a disconnect between the actuarial and accounting functions. Each group has specific responsibilities in the process but without a complete view into the processes, workflows, and data errors could be made which could impact published financial statements. Now more than ever these two functions needs to be in sync and looking at the same source information.
Now that IFRS 17 provides the opportunity to address this inherent issue, we need to be asking ourselves these questions:
- Will IFRS 17 be in the actuarial or accounting domain?
- Where will the border between actuarial and accounting be in the IFRS 17 processes?
- What is the right degree of flexibility versus traceability that needs to be supported to calibrate the relevant assumptions?
- How can accountants ensure they have the access to the assumptions made to generate the required cashflows?
- How can both sides ensure that input (cash flows) and output (line items in the financial statements) are equally understood and can be used in the right way for better decision making?
- How can the user experience contribute to solving these issues?
The solution could be to create an actuarial workplace. This – apart from reporting – would be the central touchpoint the user has with the system. Actuaries can upload their input; various assumption sets can be created; the input is transformed into the relevant line items and can be viewed and analysed by both departments to support productive discussions and decision making based on well understood financial results.
Each innovation project will begin by establishing a Lean Startup mindset, followed by the phases of Design Thinking as supported by a variety of tools. The ultimate goal is to create a Minimum Viable Product (MVP), supported by an appropriate business case.
- Open innovation project for Cookhouse Lab members
- Project team will consist of members from different insurance organizations
- Sprint: 4 weeks
- Start: Oct 22, 2018
- End: Nov 23, 2018
- Apply by: Oct 15, 2018
- Insurance & Reinsurance (all regions worldwide)
- Finance & Accounting
- Risk & Actuarial