Introduction of Global Data Standards for Finance & Insurance

Introduction of Global

Data Standards for Finance & Insurance

Introduction of GlobalData Standards for

Finance & Insurance

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What Are Data Standards?

Definition: Standard (n.) “Anything recognized as correct by common consent, by approved custom, or by those most competent to decide; a model; a criterion.” -- Webster’s New Universal Dictionary

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Type of Standards

Official vs. De Facto Standards

Open vs. Closed Standards

Horizontal vs. Vertical Standards

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Standards: Business Drivers Fueling International Interest

External: Globalization Convergence of

Financial Services Customer Centric

Marketplace E-Business

Expansion Wholesalers Portals Direct B2B service

providers

Internal: Multiple product

lines Expanding

distribution channels Mergers/Acquisitions Reduction of time to

market Shrinking IT Budgets Survival

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Standards in Chinese Insurance Industry

Standardization of Regulation Expansion of overseas

operations Interaction with Foreign

Insurance Companies China’s entry into WTO Expanding Product Lines

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Agent/Producer

InsuranceCarriers

RegulatoryAuthorities

ServiceProviders

InsuranceAgency

Reinsurer

Claims Management Applications

Auditing

RegulatoryCompliance

Payment transactions

Premium transactions

Broker/InsurerIns/ReinsurerClaims

Submission

Need for collaborationNeed for collaboration

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Benefits of Data Standards

Agent/Producer

`InsuranceCarriers

RegulatoryAuthorities

ServiceProviders

InsuranceAgency

Reinsurer

Claims Management Applications

Regulatory Compliance

Payment transactions

Premium transactions

Broker/InsurerIns/Reinsurer

Claims

Submission

STANDARDS&

IMPLEMENTATION

Auditing

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Components of Data Standards

Data Dictionary

Object Model

Relationships

Code Lists

Imact of XML on Data Standards ‘Extensible

MarkupLanguage’

Not a technologytied to any particularplatform and vendor

STANDARD developed by

‘ExtensibleMarkupLanguage’

Not a technologytied to any particularplatform and vendor

STANDARD developed by

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Party_1Gallo, Joseph M. 30350892145 Ohio1USA1Home108 Dawson St

Philadelphia PA 19130 USA Joseph Michael

Gallo 2 Single 1Male 1965-04-22

Hard to readHard to read Rigid Rigid VersioningVersioningproblemsproblems

Fixed Length Record (EDI) Example

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<Party id="Party_1">

<FullName>Gallo, Joseph M.</FullName>

<GovtID>303508921</GovtID>

<ResidenceState tc="45">Ohio</ResidenceState>

<ResidenceCountry tc="1">USA</ResidenceCountry>

<Address>

<TypeCode tc="1">Home</TypeCode>

<Line1>108 Dawson St</Line1>

<City>Philadelphia</City>

<AddressState>PA</AddressState>

<Zip>19130</Zip>

<AddressCountry>USA</AddressCountry>

</Address>

<Person>

<FirstName>Joseph</FirstName>

<MiddleName>Michael</MiddleName>

<LastName>Gallo</LastName>

<MarStat tc="2">Single</MarStat>

<Gender tc="1">Male</Gender>

<BirthDate>1965-04-22</BirthDate>

</Person>

</Party>

SelfSelfDescribingDescribing

Structured Structured

ExtensibleExtensible

XML Example

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Messaging Standards

Definition: Messaging (n.) “Loosely-couple atomic transaction between systems or trading partners.”

Business Messages are Technology-Neutral

Business “Message” vs. “Process” Enables “Straight-Through

Processing” (STP)

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STP Example: “First Notice of Loss”

Message

CustomerCustomer ProducerProducer

InsuranceCarrier

InsuranceCarrier

Value-Added

Network

Value-Added

Network

ReinsurerReinsurer

Third-Party

Admin.

Third-Party

Admin.

RegulatoryComplianceRegulatoryCompliance

Statistical ReportingStatistical Reporting

ClaimReported

LossRepaid

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Framework Standards

Definition: “Architectural platform upon which Messaging Standards are Implemented.”

Type of Frameworks Open Closed

Examples: EbXML SOAP XP (W3C) MQ Series

(IBM) BizTalk

(Microsoft)

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Horizontal Standards: Examples

ISO (Int’l Standards Org.) ISO 11179 – “Data Elements” ISO 8601 – “Time & Date Formats”

W3C (World-Wide Web Consortium) HTML – “Hyper-Text Markup

Language” XML – “eXtensible Markup Language”

ebXML (UN/CEFACT + OASIS)

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Vertical Standards: Examples

HRXML – “Human Resources XML”

XBRL – Financial Reporting (Accounting)

SwiftML – Retail Banking

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Property & Casualty(General Insurance)

•Personal Lines•Commercial Lines•Surety

Property & Casualty(General Insurance)

•Personal Lines•Commercial Lines•Surety

Life•Annuities•Health•Disability•Investments

Life•Annuities•Health•Disability•Investments

Banking and Securities

Banking and Securities

RegulatoryRegulatory

ReinsuranceReinsurance

Common Data Models

Multiple Distribution Channels

Common Data Models

Multiple Distribution Channels

HumanResourcesHumanResources AccountingAccounting

No Industry Exists in a Vacuum

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Vertical Standards – Insurance Industry Examples

Life Insurance ACORD XMLife (U.S.A.) ORIGO (U.K.) CLIEDIS (Canada)

P&C (General) Insurance ACORD XML for P&C (U.S.A.) eEG7 (Europe) Polaris (U.K.)

Reinsurance ACORD “JV” (Europe)

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Who is ACORD?

Independent and Objective Association Serving the Industry since 1970 Facilitating Industry-Driven

Standards (Carriers, Agents,Solution Providers, Associations)

Not For-Profit Corporation Anti-trust Exemption

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Evolution of . . .

1970’s Forms

1980’s AL3 1990’s AL3 Implementation

2001 + Convergence, Global, Reinsurance

1998

XML 1996Life Standards

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Standards Supported

Life Insurance Life Annuities Disability Investments Group Life Reinsurance Global

Object Model

XMLForms

Property & Casualty Personal

Lines Commercia

l Lines

Surety

EDI

XMLForms

Joint Venture Reinsurance P&C

Reinsurance

Large Commercial Lines

Global

EDI

XML

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Global Standards Committee Mission, Policy & Arbitration

Steering Committees Approve & Prioritize projects

P&C Life Reins/ Global Commercial

Subcommittees Develop Standards Members vote Life, P&C,Reinsurance, Forms

Working Groups Implementatio

n guides New

transactions

<EffectiveDate><EffectiveDate/><ExpirationDate><ExpirationDate/><PartyName><PartyName/>

The Standards Process

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0 100 200 300 400

2000

1999

1998

1997

2001 YTD *

405405

Member Growth - Carriers and Solution Providers

* As of August 2001

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Membership Profile

P&C Carriers

Life Carriers

Reinsurers

Agents/Brokers

Suppliers

See www.ACORD.org for most current membership listing

Trade Associations User Groups Financial Services Org. Risk Managers Service Bureaus Lab Companies

Global Global ReachReach

P& C InsuranceP& C Insurance

ReinsuranceReinsurance

Life Insurance Life Insurance

New OpportunitiesNew Opportunities

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StandardStandardss

Cooperative ApproachCooperative Approach

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Cooperative Standards Process

Workflow Analysis Standards Atlas

Determine Overlap and Opportunity

Identify Strategic AlliancesDevelop Plan for

Common Model / Transactions

Merge/Converge Harmonize Enhance Build New

Detailed Plan of Single View

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Alliances and Relationships

Harmonized Standards

ACORD Standards

Hr-XML Hr-XML

DTCC DTCC

CSIO (Canadian Standards)CSIO (Canadian Standards)

ANSI X12 - mapped Life ReinsuranceANSI X12 - mapped Life Reinsurance

EDIFACT (D9)EDIFACT (D9)

EEG7 (Western European EDIFACT Insurance EEG7 (Western European EDIFACT Insurance Group)Group)

IFX (Interactive Financial Exchange)IFX (Interactive Financial Exchange)

Life Office of South AfricaLife Office of South Africa

RIMSRIMS

CLIEDISCLIEDIS

Joint Venture ReinsuranceJoint Venture Reinsurance

MIBMIB

NAILBANAILBA

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