Enterprise Resource Planning System for Insurance Sector

Enterprise Re reservoir grooming System for Insurance SectorThe Indian Insurance industry is a flourishing one which has several(prenominal) national and internationalistic players who compete for excellence. With several reforms and policy regulations, the Indian restitution sector has witnessed tremendous harvesting in the recent past.India having around 17% of the worlds population is a man-sizedly untapped market. Nearly 80% of the Indian population being without a life, health and non life insurance, a maturement chassis of insurance companies are now emerging in the Indian insurance sector. With the opening up of the economy, several international leaders in the insurance sector are trying to venture into the India insurance industry.The growth in the insurance industry conductly impacts the reinsurance industry. Reinsurance providers are basically companies that provide insurance cover to insurance companies so as to cover their chance. With the growth in the amount of insurance harvest-homes sold by the insurance companies their risk component goes on increase. So as to cover this risk, companies resort to reinsurance. Thus the reinsurance market is all growing at a rapid pace.The growth of the Reinsurance industry in India is coupled with a number of challenges. Challenges set about by the reinsurance industry include shrinking margins, increasing opposition etc. In order to tolerate the challenges, reinsurance companies crossways the globe have begun leveraging heavily on their information and communication technologies.Reinsurance firms are exploitation enterprise management antecedents to increase productivity, save on expenses, to obtain higher client satisfaction, thereby resulting into customer retention and to improve sales performance.General Insurance Corporation of India (GIC Re) is the sole reinsurance company in the municipal reinsurance market in India with more than three decades of experience in the Re-Insurance tune. GIC is headquartered in Mumbai.In India, GIC provide reinsurance to the direct insurance company as it is the sole reinsurer in the market of domestic reinsurance. It is one of the leaders in the facultative placements and domestic companies treaty programmes.OBJECTIVES FOR ENTERPRISE RESOURCE PLANNING SYSTEMThe key objectives for initiating ERP implementation were as followsSo as to retain leadership position in the national (Indian) reinsurance market.The intention of emerging as the leader of reinsurance in the Afro Asian markets.To obtain an unified view of all business transactions.MAJOR backing CHALLENGES FACED BY GIC RECustomer-CentricityThe change in focus of the organization to being customer-centricity created a number of issues for the company.It became important to have optimal knowledge of all the customer segments.Customized products and religious services were required to designed to congruous the needs of each of the identified customer segments.It became impor tant to adopt cross selling of products and services as an important growth strategy.It also became important to provide any while and any place reachability to the customers. competitionThe growing number of players in the market created an environment of intense competitionIn order to bear such levels of competition it became imperative for the company to adopt new strategies and identify means of securing a combative advantage over its competitors.Globalizationelaboration of company operations across multiple geographical locations also made it necessary for GIC Re to identify means of effective monitoring and control.Expansion also increase the level of competition by adding new competitors from the new geographical locations.Product CommoditizationThe increase in competition was impacting the companys profit margins.It became absolutely necessary for the company to distinguish its brand from competitors.Lower customer loyalty and increasing price sensitivity were also foot print threats to GIC Re.ConsolidationIt was important to bring about a integrating across the organization so as to deliver a clear value to its customers.ComplianceExpansion of operations across multiple geographical locations made its imperative to comply with multi-national regulations.MAJOR IT CHALLENGES FACED BY GIC REData timbreData maintained by the organization was fragmented by the specify of business, the branches, the different geographical locations etc.It was important to consolidate this data and provide high quality of product and operations related data.Process IntegrationIt was important to standardize and streamline cross functional processes and gear up and integrated workflow.The company was suffering from value leakage due to non integration of arrangings.Legacy IT SystemsThe legacy system apply by the company did not reflect the change in focus from being a contract centric to customer centric insurance provider.Reduction of Operation ComplexityThe compa ny used a number of applications to manage the daily activities.As a result, a number of interfaces had to be monitored and managed which turn out to be very difficult.It thus became important to reduce the number of interfaces and bring about standardization across the interfaces.EXPECTATIONS FROM ERPReduction in overall cost through improved efficiency and increased productivity purport business innovationTo a give a competitive advantage to the company over its competitors number one wood for business growthImprove overall customer experience and satisfactionEnsure regulatory conformationSupport global operationsCreate new revenue streams for the companyEnsure growth of actual revenue streamsCHOICE OF check outThe major(ip) factors contributing to the choice of fool are as follows co-ordinated Enterprise platform for transacting GICs businessThe company required a platform that would integrate all the processes and procedures across the enterprise.The system was required to s tandardize all processes and streamline set of processes across the organization rather than streamlining large number of procedures.The company expected the have an enterprise wide visibility of business operations.SAP Reinsurance settlement being used by Global Industry leaders Munich Re and Hannover ReOne of the major contributing factors to choosing SAP was the companys biggest competitor and the global industry leader Munich Re and Hannover Re had implement SAP Reinsurance system.Adoption of the global best practicesBy 2005, SAP Insurance had almost all insurance service providers running it.SAP had in the past implemented both the insurance and reinsurance packages for multiple clients.This enabled SAP to earn an understanding of the global best practices in the prevalent in the industry.GIC Re hoped to reap the benefits of this knowledge in their own implement of SAP Reinsurance.Most companies who had previously implemented ERP had strong positive experience with SAP for t heir insurance portfolioERP IMPLEMENTATION START DATE Early 2005ERP GO LIVE DATE February 2006SAP var. SAP R/3 interpreting 4.7GEOGRAPHICAL SCOPE Offices in India, London and DubaiSAP MODULES implementSAP FS-RI ReinsuranceSAP FS-RI is an insurance solution that enables reinsurance firms, direct insurers and brokers to achieve a reinsurance process that is completely integrated and streamlined.SAP FS-CD Collections / DisbursementsSAP FS-CD is a solution designed for insurance service providers to standardize and streamline their armorial bearing and disbursement activities for their policyholders and agency holders.SAP IM-IC (CFM) Investment ManagementSAP IM-IC (CFM) module provides useful tools for reporting of west by south which are in progress, PO commitments and assets that have been capitalized.SAP FI-CO FinanceThe SAP FI-CO module can be viewed as the core of the integrated SAP system as it deals with the monetary impacts on business and separate modules of SAP.SAP HR Human ResourcesSAP HR is the largest module implementedIt deals with the management of military personnel resources and human capitalSAP BIW Business IntelligenceSAP BIW is the business intelligence module that provides analytical, reporting and data warehousing solutionIMPLEMENTATION CHALLENGESFirst SAP Reinsurance (FS-RI) implementation outside Europe.First SAP FS-CD murder in India.First SAP IM-IC implementation in India in an Insurance/Reinsurance environment.One of the few industrious Reinsurers in the world using SAP FS-RILegacy data MigrationCustomisation of Reinsurance Module (FS-RI)Risk Manager in FS-RI (Facultative Business) had not yet been implemented even in EuropeIMPLEMENTATION HIGHLIGHTS hazard to critically re-look the companys business processes and practices and incorporate changes wherever required.Elimination of data inconsistency by correcting, validating and cleansing legacy data.Opportunity to streamline the organisation by adopting the global best practi ces in the industryBUSINESS BENEFITSTight integration between underwriting and technical Accounting processes thereby providing better business focus.Integrated processes eliminating almost all redundancies and inter-departmental reconciliations.increase automation reduced manual intervention and improved data quality.Improved reserving process (tracking the development of nifty loss reserves).FINANCIAL STRATEGIC BENEFITSSAP allowed visibility of all assetsStandardized evaluation of all assets were achieved insouciant updates to the investment portfolio enable the company to achieve integrated investment managementEffective real time risk analysisTOTAL COST OF OWNERSHIP95 % of the companys requirements were met by th standard solution offered by SAP and minimal customization was requiredOPERATIONAL BENEFITSThe operation benefits as evaluated by the company later two years of implementation are as followsKEY PERFORMANCE INDICATORS (KPI)IMPACTTime to measure performance-70%Time to plan for new projects and activities-30%Time to performance market risk analysis-80%Efforts to office sources of risk-80%Reporting Flexibility+90%Quality of Reports+80%Quality of Portfolio evaluation+90%Quality of transaction mapping+90%FUTURE PLANSUp gradation from SAP R/3 Version 4.7 to SAP ECC 6.0 platformConnecting offices in Moscow, Malaysia and South Africa to the upgraded ERP networkGeneral Insurance Corporation of India has derived pregnant benefits from implementation of SAP Reinsurance. From this case it is evident that SAP has the potential of being a measure source of improved efficiency and competitive advantage for insurance service providers.APPENDIX1 Monitor Performance executive director Dashboard2 CEO Dashboard3 Sales Dashboard