Академический Документы
Профессиональный Документы
Культура Документы
Contents
Executive Summary
04
10
14
16
20
26
30
Executive Summary
1. Investments in risk
analytics are increasing
and executives expect
ongoing developments in
this area.
Executives are supportive
About 95 percent of the surveyed
companies are currently using risk
analytics. About half (49 percent) are
using these techniques in a coordinated
way across the company while the other
half (47 percent) are implementing
solutions in pockets within particular
geographies or business units. The
primary applications of risk analytics are
for risk based capital, managing credit,
and business strategy.
3. Data consistency is a
significant challenge.
In general, data availability is not
a major issue: Only 7 percent of
respondents cited a lack of data
as one of their challenges. The
problem, instead, is often one of data
consistency, rooted in the inability to
integrate analytics and insights across
siloed divisions and functions, severely
compromising the effectiveness of the
overall risk management capability.
Of all respondents, 40 percent determine
their risk analytics data requirements
by collecting data only pockets within
the firm. Just 27 percent of those
surveyed have a fully aggregated view
of risk across their organizations. This
inability to look at risk broadly and in
an integrated fashion has, potentially,
several negative implications for
insurers. In commercial property and
casualty (P&C), for example, simply
understanding exposure by industry
can be difficult because policy systems
could be based on Standard Industry
Classification (SIC) or North American
Industry Classification System (NAICS),
while investment and credit systems
are often based on the Global Industry
Classification Standard (GICS).
Leaders show significantly more
advanced capabilities in data quality
completeness, accuracy and consistency
in both producing and collecting data.
Fifty-four percent of leaders describe
their capabilities in data quality and
sourcing as excellent, compared with
only 19 percent of laggards.
More than 54 percent of leaders
note that they are able to take a fully
integrated view of risk aggregated
across models, while only 22 percent of
laggards claim this capability.
Laggards are more likely to have trouble
with siloed data. Forty-four percent say
that data about risk events is collected
in pockets internally within the firm,
while only 23 percent of leaders say this
is so.
4. Risk analytics is
currently more preventive
and reactive than
predictive.
Only about one-third of companies
studied (36 percent) say their risk
management capabilities are proactive
and strategic; 46 percent say their
approach is primarily preventive; and
almost one in five (18 percent) say
their risk management capabilities
support merely reactive responses
to events. Spending also reflects the
relative scarcity of proactive risk
management: The allocation of risk
resources, across all industries, is
primarily for preventive activities.
Far greater percentages of leaders are
apt to say they use analytics in fraud
prevention82 percent, compared with
only 52 percent of laggards. Leaders also
link analytics to business strategy more
effectively: 79 percent say they use
analytics in setting business strategy,
while only 60 percent of laggards do so.
5. Lack of expertise in
risk analytics looms as an
important challenge.
Most organizations (71 percent) built
their current risk analytics capabilities
in-house with support from outside
vendors and/or consultants. Twentynine percent do not rely on any external
specialists, rather they use internal staff.
However, only 19 percent of companies
surveyed rank their staffing capabilities
as excellent.
These findings underscore the fact
that analytics is a relatively new field,
and that optimal talent sourcing and
development are not yet in place
at many firms. Organizations need
to consider how best to meet that
challenge, whether it is accelerated
internal development, better hiring or
more comprehensive external sourcing
and collaboration, even on a managed
service basis.
Steve Culp
Managing Director
Accenture Risk Management
8%
19%
9%
35%
Region
20%
Industry
19%
28%
40%
22%
Europe
North America
China
Banking
Insurance - Life
Insurance - P&C
Chemicals
8%
25%
32%
16%
14%
Role
Revenue
28%
23%
16%
38%
$5 billion to $10 billion
$100 million to $1 billion
10
Figure 1
Significant percentages of insurance firms agree that risk analytics has improved decision-making and
risk monitoring
How do you characterize the importance of risk analytics in your organization?
57%
58%
65%
58%
48%
23%
18%
17%
17%
16%
23%
22%
14%
24%
28%
2%
All Industries
2%
Insurance Property &
Casualty
6%
1%
Banking
1%
Chemicals
Insurance Life
11
Figure 2
Insurance companies are challenged by a range of technology and process issues in the area of
risk analytics
For your organization, to what degree do the following challenges impede the effectiveness of risk analytics processes?
Medium + High impact
All Industries
Insurance Life
Banking
Chemicals
71%
78%
66%
74%
63%
69%
78%
66%
70%
59%
66%
74%
55%
68%
62%
66%
72%
56%
71%
60%
65%
67%
60%
68%
62%
67%
66%
57%
75%
65%
70%
65%
65%
75%
68%
66%
64%
60%
73%
58%
Lack of budget
64%
64%
65%
64%
61%
68%
63%
62%
71%
72%
57%
62%
56%
61%
45%
61%
59%
61%
65%
54%
12
Real-time optimization
Optimal response
embedded in real-time
process
Institutional action
Predictive action
Predictions of response
by target/segment
Differentiated action
Key targets/segments
Key targets and segments
defined
Data in order
Well-defined, common,
clean, and integrated
data
Reprinted by permission of Harvard Business School Press. From Analytics at Work: Smarter Decisions, Better Results by Thomas H. Davenport, Jeanne G.
Harris and Robert Morison. Boston, MA 2010, p.83.
Copyright 2010 by the Harvard Business School Publishing Corporation; all rights reserved.
13
14
Dealing with
regulation
One of the most important factors
fueling the interest in risk analytics
is improving compliance capabilities
and dealing more effectively with
an increasingly complex regulatory
environment. In our experience,
the Solvency II directive has been a
focus area for insurers across most
European geographies. Even given the
current postponement of the Solvency
II implementation, firms should
consider ongoing investments in their
quantitative and qualitative capabilities
to achieve Solvency II readiness.
Although Solvency II applies to
European firms, our analysis indicates
that there is a more pervasive
mood across the global regulatory
environment that will put additional
pressure on the insurance industry
everywhere to provide policies similar to
those in Solvency II, as a kind of quality
check for insurance groups. The key
Driving growth
Transforming the
operating model
15
16
Figure 3
Many insurers expect to invest in risk analytics at higher levels than other industries
Over the next two years, how does your organization expect investments in risk analytics to change?
49%
43%
41%
36%
34%
28%
28%
27%
25%
24%
19%
19%
12%
2% 1% 1%
19%
15%
14%
13%
14%13%
10%
4%
1% 1%
All Industries
Increase 0% to 9.9%
Decrease 10% to 19.9%
1%
3%
0%
Insurance - Life
1% 1% 1%
Banking
No change
1% 0% 0%
Chemicals
Decrease 0% to 9.9%
17
Regional investment
differences
Initiatives include:
Implementation of risk-adjusted
performance measures in a consistent
manner across different divisions
of the firm, to promote the use of
appropriate measures for steering,
monitoring and reporting as well as
for operational decision making.
Figure 4
Analytics investments are expected to increase, especially in data quality and sourcing, software
and modeling?
Over the next two years, in which areas does your organization expect to increase risk analytics investment spend?
(Select all that apply)
50%
41%
44%
46%
56%
55%
53%
48%
49%
55%
50%
49% 49%
44%
32%
26%
26%
22%
40%
39%
36%
32%
32%
18
58% 58%
30%
35%
31%
25%
25%
Insurance - Life
Systems integration
Reporting and dashboard development
Banking
Modeling
Management use and acceptance
Chemicals
Software
Staffing
27%
23%
Figure 5
North American organizations spend more than one-half of their risk analytics investments on underwriting,
while distribution sees the least capital
Within the insurance functional area, where does your organization currently spend the majority of its risk analytics investments?
38%
52%
61%
25%
17%
11%
13%
8%
13%
17%
5%
All Insurance
North America
3%
Insurance Property & Casualty
21%
8%
8%
Underwriting
Investments
Equal distribution of investment dollars
Claims
Distribution
Insurance - Life
19
20
Modeling
Modeling plays an important role in
helping insurers comply with regulatory
guidelines and make efficient capital
management decisions that can improve
the bottom line. The proper use of
models can guide management teams of
insurance firms to make more informed
business decisions and take timely
action to mitigate possible losses. More
effective capital calculation models
can help insurers meet their regulatory
requirements and improve business
performance by managing different
products and tracking performance by
business unit.
Figure 6
Insurers in general are not confident in the maturity of their modeling capabilities
How would you rate the maturity of your organizations risk analytics based upon the components of the risk
analytics process?
24%
24%
23%
18%
44%
31%
34%
32%
Insurance - Life
Banking
Chemicals
Excellent
Above Average
21
Scenario modeling
and stress testing
Data management
Within the insurance industry, the
sophisticated models that can foster
more effective risk management depend
upon the availability of accurate and
validated data, properly organized
and delivered with the right level of
detail and granularity. The terabytes
of data accumulated by insurers each
day constitute an ongoing challenge,
and firms are responding. As our
study found, data quality and controls
have emerged as prominent areas
for increased investment spending
by insurers. Commercial carriers, for
example, often have data challenges
with location concentrations, limits and
deductibles of their various risks.
Another data issue concerns the fact
that Solvency II requirements and other
regulatory measures have cast a harsh
light on the quality, comprehensiveness
and timeliness of insurance firms
data. Many European insurers have
taken initial steps to go through the
regulatory requirements and set up
at least an interim regime to enable
them to calculate, report and create
an initial, end-to-end perspective in
accordance with Solvency II. But
Figure 7
41%
60%
82%
61%
58%
80%
83%
61%
81%
95%
74%
81%
33%
22%
19%
15%
18%
3%
2%
All Insurance Insurance Europe & Asia Property &
Casualty
20%
25%
13%
4%
Insurance Life
14%
5%
Japan &
South Korea
22
17%
2%
Europe
19%
7%
China
Data governance
Figure 8
Relatively low percentages of insurers integrate stress testing with strategic decision making
To what degree are scenario modeling and stress testing techniques utilized in your organization?
27%
38%
37%
38%
44%
52%
48%
12%
49%
18%
2%
All Industries
3%
Insurance Property &
Casualty
11%
48%
45%
2%
Insurance - Life
10%
Banking
1%
13%
3%
Chemicals
23
Reporting
Figure 9
36%
26%
37%
21%
32%
37%
Staffing
34%
Software
32%
Systems integration
31%
Above Average
Excellent
Base size: Total sample.
24
23%
26%
Insurance - Life
33%
29%
42%
39%
Banking
24%
18%
Chemicals
37%
30%
41%
26%
38%
46%
41%
36%
27%
21%
18%
42%
20%
38%
18%
39%
16%
42%
19%
34%
21%
42%
14%
29%
20%
23%
27%
36%
16%
17%
35%
22%
33%
23%
32%
40%
21%
15%
17%
Software and
systems
Our study found that insurance firms are
mostly relying on their in-house tools
and software for Solvency II reporting
purposes. However, the use of external,
third-party tools is an emerging trend
and several insurers are planning to buy
or lease specific reporting tools as well.
(See Figure 10.)
Differences between leaders and
laggards emerged in comparing
different companies approaches
to the use of software and tools to
meet Solvency II reporting needs.
For example, 67 percent of leaders in
Europe, Japan, South Korea and China
are considering the development or
enhancement of in-house software,
compared with only 24 percent of
laggards. And 24 percent of leaders
plan to buy or lease specific products
for meeting Solvency II reporting
requirements, compared with 18 percent
of laggards. A higher percentage of
laggards (69 percent) prefer to use
current actuarial tools for Solvency II
reporting than do leaders (52 percent).
Talent management
Figure 10
37%
18%
38%
18%
Insurance - Life
Europe
17%
66%
65%
66%
68%
68%
36%
27%
5%
48%
35%
18%
Japan & South Korea
58%
62%
61%
33%
China
30%
53%
67%
73%
25
26
Integration of risk
processes and
capabilities
Figure 11
Insurers agree that an integrated approach to risk and analytics can provide competitive advantage
Would developing an integrated approach to risk and analytics give your organization a competitive advantage?
32%
85%
86%
54%
27%
32%
32%
53%
32%
59%
55%
85%
86%
87%
37%
53%
90%
53%
Yes, certainly
Yes, probably
11%
9%
5%
5%
All Insurance Insurance Europe & Asia Property &
Casualty
8%
5%
Insurance Life
14%
Japan &
South Korea
11%
5%
Europe
3%
7%
China
27
Integration with
management
processes
Integration with management processes
is also a challenge. Seventy-eight
percent of P&C firms and 66 percent
of life insurers say that the inability to
embed risk analytics into management
processes is having a high or medium
impact on their firms. In terms of a
specific capability such as stress testing,
only 27 percent of P&C insurers feel that
stress testing is integrated into strategic
decision making for large projects,
compared to 38 percent overall.
Overall, risk management can be
improved through the consideration
of risk in the decision-making process,
and analytics play a vital role. For
example, an effective integration of
risk-based capital methodologies in
decision-making tool kitsrequiring
high data quality and a common
measurement approach such as one
based on economic capitalcan
weigh both the combined effects of
risk-taking activity and the impact of
such activity on economic value. With
economic capital models, insurers
Integration of risk
models
Our survey also asked about the degree
to which insurers have integrated their
risk models. Only 32 percent of life
insurers and 31 percent of P&C firms
claim to have achieved a fully integrated
view of risk aggregated across models.
One in five insurers say that separate
risk models are used for each type of
risk. (See Figure 12.)
Model outputs are generally better for
a firm when the model can provide a
fully aggregated view of all types of
risk. To achieve this aggregated view, a
high level of integration between the
models is needed. This means that all
important models used for different
types of risk within the organization
should be able to make consistent
assumptions and generate comparable
results. Having a large number of
Figure 12
Only about one-third of insurers say they have a fully integrated view of risk across models
What is the level of integration for risk models in your organization?
27%
31%
32%
52%
49%
49%
24%
22%
55%
54%
There is a fully integrated view of risk
aggregated across models
There is some degree of integration
between models
21%
20%
19%
21%
23%
All Industries
Insurance Life
Banking
Chemicals
28
Enabling better
integration
What are some steps companies can
consider taking to address the challenge
of siloed or non-integrated risk
functions? Here are a few.
Consolidate and
standardize the IT
environment
In our experience, many insurance
companies operate with a fragmented
risk architecture that fails to support the
full use of risk management tools and
models within the context of the overall
business. Outdated legacy systems and
out-of-date architectures that prevent
effective integration are also a factor, a
restriction noted by 78 percent of P&C
firms and 66 percent of life insurers.
In other words, given the existing IT
landscape and the manner in which
different parts of the business operate,
risk analytics may amount mostly
to various point solutions generated
and used in different areas. Modeling
teams have one subset of technology,
underwriting teams have another, and
then those working on the reporting
side have their own homegrown system.
The systems in total may not provide an
integrated view of risk.
29
30
31
Markus Salchegger
Markus Salchegger is a senior director,
responsible for Risk Management
Insurance in Austria, Germany and
Switzerland. Markus holds a PhD in
Mathematics, and over the past 15 years,
he has used his extensive experience in
insurance, reinsurance, banking, asset
management and software development
to analyze, design and deploy solutions
for risk management and financial service
applications that help clients become
high-performance businesses.
Ferko Spits
Ferko Spits is a senior manager
responsible for Accenture Risk
Management Insurance for North Asia
(China, Japan and Hong Kong). Based
in Hong Kong, for the last 13 years
Ferko has been working with financial
services companies to transform
their risk and finance functions,
processes, data management and IT
architectures. He combines broad
industry experience in the insurance,
reinsurance and banking sectors with
extensive specialization in risk and
regulatory requirements to help clients
become high-performance businesses.
Prasanna Varadan
Prasanna Varadan is a senior manager,
Risk Management, India. Based in
Chennai, India, Prasanna has more than
12 years of consulting experience in
financial services and risk management.
He has worked with global and regional
financial service firms across Africa,
Asia Pacific, Europe and North America
to transform their businesses and risk
capabilities. His specialized experience in
risk management, regulatory compliance,
credit risk and operating model strategy
helps Accenture create differentiated,
industry specific offerings to help clients
become high-performance businesses.
About Accenture
Management Consulting
Accenture is a leading provider of
management consulting services
worldwide. Drawing on the extensive
experience of its 16,000 management
consultants globally, Accenture
Management Consulting works with
companies and governments to achieve
high performance by combining broad
and deep industry knowledge with
functional capabilities to provide
services in Strategy, Analytics, Customer
Relationship Management, Finance &
Enterprise Performance, Operations, Risk
Management, Sustainability, and Talent
and Organization.
About Accenture
Accenture is a global management
consulting, technology services and
outsourcing company, with 257,000
people serving clients in more than
120 countries. Combining unparalleled
experience, comprehensive capabilities
across all industries and business
functions, and extensive research on
the worlds most successful companies,
Accenture collaborates with clients to
help them become high-performance
businesses and governments. The
company generated net revenues of
US$27.9 billion for the fiscal year ended
Aug. 31, 2012. Its home page is
www.accenture.com.
12-3035 / 02-5176