Mapping the impact of risk: the team of Paul Budde and Kristi Wilts is a force nature has to reckon with.
Paul Budde, senior managing director for product development with Aon Benfield, was given the task of leading a small team to integrate the exposure management systems of Aon and Benfield, when Aon decided to purchase Benfield, a well-known analytics shop in the reinsurance marketplace. The end result was to be called ImpaetOnDemand.
"Benfield had Exposure View, which has strong mapping functions, and Aon had Cat Portal, which was a data warehouse, heavy on business intelligence," Budde said. "Both tried to do similar things from different perspectives. The Eureka moment for us was taking the strengths of both and not just sticking them together but using those strengths as the basis for a complete, integrated redesign."
That initiative took a bit of courage, because it drove against the tendency common in behavioral psychology called the persistence of interim solutions. "There was some pressure to just stick the two things together," Budde said. "It would have been quicker, and there were plenty of other things we could have been working on. But once we decided that a complete redesign was best in the long run, we got very good support up to the corporate level."
"Paul's expertise in actuarial mathematics and modeling enabled him to see an opportunity to turn the project into an underwriting tool," said Dan Dick, executive managing director, at Aon Benfield, "and then Kristi working in the field saw a role for it as a claims management tool."
Budde realized early that current mapping speed and performance capabilities were not sufficient. Clients wanted faster, more flexible, more powerful applications than were commercially available. Working with in-house software designers and code writers, Budde developed first a mapping and tiling operation.
The tool is integrated with the National Oceanic and Atmospheric Administration (NOAA) for live tornado, hail and thunderstorm activity, as well as with EuroTempest to provide in-depth analysis of European windstorms.
Insurers can upload their most current portfolios for viewing and analysis at any time, and are able to plot as many as a million risk locations.
"All other programs require the broker to upload the data," Dick said. "That is fine under ordinary circumstances, but what if a hurricane is bearing down? ImpactOnDemand allows clients to load their own data. We saw the value of this in the tornadoes in Joplin, Mo. This was a totally new way of thinking about data access and display. It has already been a very rough year for tornadoes and haft, but we have been able to overhaul our claims and underwriting capabilities on the fly with this."
Once the original initiative started to take on a life of its own, its development gathered momentum, Budde's team realized the tool would have to have a flexible but rigorous permissions system with tiered access and authority.
One hallmark of innovation is not just the original thinking and execution that goes into the initiative, but how much further innovation it engenders in others. Once the tiered hierarchy structure was in place, it also enabled a theoretical function. Users can take projected storm paths and run potential damage scenarios safely isolated from actual loss information.
ImpactOnDemand is a web-based application, which means that users can access their data globally through a secure connection with a proprietary public and private key encryption scheme. The platform requires no installation or local storage capacity.
With that flexibility, Managing Director Krisi Wilts took the system into the field for training and testing. "She quickly came back with a next-generation idea for smart-phone applications that could be used by adjusters live in the field," Dick said.
There is no limit on the number of locations that can be uploaded, viewed and analyzed with ImpactOnDemand. Users can view and track exposures worldwide via its global mapping capabilities and portfolio analysis tools, and receive real-time information on catastrophes including earthquakes, hurricanes, wildfires, tornado and hail events, and even volcanic eruptions.
The tool is integrated with pre- and post-event identification of exposures by CRESTA zone for named storms, as well as identification of exposures by CRESTA zone using the EuroTempest live five-day, peak-gust speed forecasts and recorded observational data. It is also integrated with Tropical Storm Risk for live tropical cyclone event analysis.
Colleagues say Budde and Wilts are an ideal inside-outside complement. He holds a doctorate in mathematics from the University of California at Berkeley, and was a 2008 Reinsurance Power Broker[R]. She has field experience in both marketing and claims adjusting, as well as training.
Based on input from the field, the next generation after the next generation could be moving out into other types of coverage beyond property and casualty. "The ability to visualize data is the key," said Patrick Sheridan, responsible for corporate risk management at the Westfield Group. "With the business analytics in place, there is likely a great deal of capability beyond current lines."
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|Title Annotation:||RISK INNOVATOR[TM]: INSURANCE|
|Author:||Morris, Gregory D.L.|
|Publication:||Risk & Insurance|
|Date:||Sep 15, 2011|
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