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Can ADDACTIS® One generate XBRL files? If yes, which taxonomies are supported?

Yes, ADDACTIS® One aims at generating reports under XBRL format as well as under other formats like Excel spreadsheets. It embeds the latest official SII taxonomies released by EIOPA.

How are managed regulatory updates of QRT, taxonomy and delegated acts?

ADDACTIS® One database is designed to store and display different versions of QRTs and taxonomies. It embeds also different versions of Solvency II calculation engine.

Is it possible to visualize reports in the tool?

Yes, all the QRTs are displayed inside the software in an Excel like interface facilitating figures analyzes and validation before XBRL generation by experts.

Is ADDACTIS® One doing the mapping (identification of figures according to QRT expected data)?

Yes, the data mapping is embedded in the solution.

For which companies is ADDACTIS® One dedicated?

ADDACTIS® One produces Pillar1 & 2 indicators for any kind of companies: non-life, life and health and all the reports are available in the software (for any LoB).

Have clients ability to define their own reports?

Not yet. Currently our developments are focused on regulatory requirements but soon, users will be able to define their own templates using existing data or user-defined data as well as their own tests. So, users will be able to use ADDACTIS® One for both internal and regulatory reporting, with consistent figures.

QRT requires validation from various departments (accounting, finance, actuarial, etc.), is it possible to drive that while keeping data confidentiality?

Administrators can define as many user-profiles as required and for each profile rights – as viewing, editing, validating – can be granted at different granularity levels as report, entity and project. Hence confidentiality can be ensured without functional limitations.

How is the traceability managed in ADDACTIS® One?

Each single data is attached to an audit trail that makes the traceability for each data possible. There is also a global audit trail that tracks each action done in the software.

Does ADDACTIS® One integrate a feature to manage and store narrative reports?

Yes, ADDACTIS® One can populate a report by replacing ADDACTIS® One tags by figures from a specific project.

Expertises

Focus on ORSA

Could you please summarize how ORSA can improve the risk management’s understanding inside insurance companies?

Our point is that ORSA is not a mandatory exercise to produce economic information for Supervisors. ORSA is the new way to project dynamically the whole activity inside the insurance company, properly measuring the ensemble of undertaking risks and projecting values that allow the company management to take accurate measures to keep (profitable) the own capital looking forward. ORSA is like a “video projection” of the business, while QIS is a simple photography. We try to help companies by showing how the use of standardized tools, modules and models -all of them tested in more developed markets- could make their job much easier and safer. A huge work. We are now able to show how ORSA looks like depending on the insurance branch activity (life, pensions, health, non-life, workers comp) or country: each one feels totally different from the others and wants to have their regulation and singularities reflected in each of our presentations.
Javier Aparicio, CEO ADDACTIS Latina.

Expertises

Focus on ORSA

Did the markets fully understand the ORSA issue or do they just answer a regulatory request for risk management?

ORSA is firstly “a new and tedious obligation” for many undertakers. Only large multinational and regional companies are really sensitive with the meaning of ORSA. But this is plausible in markets generally focused on critical issues like producing new business. Supervisors are usually putting pressure on aspects that in EU have disappeared along the last couple of decades. Just to give you an idea, the submission of Technical Notes is still far more important than the submission of Solvency information. We rapidly became software providers and consultants of several supervisors in the region within our eight months of real market activity. All of them are primarily concerned about non-life insufficiency reserving, which is a crucial point for all of them, but just a piece of the picture.
We really look forward to work closer with supervisors, showing our European experience and our growing involvement with some of them in Latin America. And not only with Insurance Supervisors: keep in mind that the health insurance activity and workers compensation insurance here are also supervised by Health and Labour supervising bodies. The supervisor is the one whose mission is to convince insurance actors to use ORSA tools. This is, more than the best, the only new way to manage insurance business nowadays. Reporting is just a fair transparency exercise resulting from a previous modelling, monitoring and managing process carried out by more professional teams.
Javier Aparicio, CEO ADDACTIS Latina.

Expertises

Focus on ORSA

What is your feedback about the implementation of ORSA in the insurance companies of Latin America?

Latin American Markets are moving with different perspectives and speediness. This is not the EU and the Insurance Supervisor in each country is fully autonomous to move on new Risk-based supervision, despite the effect (i.e. pressure exerted by large multinationals seeking uniform rules and fair competition).
All supervisors are tied under ASSAL Cooperation Association. They hold meetings twice a year to share experience and information. ADDACTIS® has been invited to participate, which brings us a valuable vision of the regional Solvency picture.
So, the vision of ORSA varies from country to country and we must adapt our know-how and visualisation. While countries like Chile have determined ORSA as a mandatory exercise whose starting point is “the risk appetite”, ORSA is still not considered in other jurisdictions.
Upon our arrival to Bogotá, we quickly found out that we were in the right place at the right time. At second glance we perceived a lower density of high-tech actuarial consultants (here are rather focused on product development, pension plans management, technical notes and reserving certifications). But we cannot fall asleep! Time goes by and most countries in the region already have tight Solvency implementation calendars. 2017-18 are going to be hectic. Supervisors are mostly favourable to simpler ORSA and reporting structures than those in EU. It is also a matter of market sizes and, keeping both feet on the ground, it makes a lot of sense to consider that most companies are small and have no resources to add a new sophisticate range of actuarial activities to their life.
We have targeted about a thousand risk undertakers in the region. To be successful, the key is to quickly adapt risk-based management rules to their real possibilities and needs, and to remain close to them.
Javier Aparicio, CEO ADDACTIS Latina.

Expertises

Focus on ORSA

ORSA S2 and ORSA SST are pretty much the same, aren’t they? What are the main differences in terms of flexibility and application schedule?

In June 2015, the Swiss solvency regime was recognized as Solvency II equivalent. This decision confirms the two systems’ similarities. However in order to get this approval, Switzerland had to perform several modifications of the insurance supervisory system that was in force, in order to converge towards the European Solvency II regime. The introduction of an ORSA requirement was one of these measures.
The first deadline for Swiss insurance companies to submit their ORSA report is January 31st, 2017 whereas EU insurance companies are required to perform an ORSA valuation at least once a year since the Solvency II directive came into force in January 1st, 2016.
Concept and definition of the Swiss ORSA are analogous to the ones defined by the Solvency II directive. Nevertheless we can observe a few minor differences. Broadly speaking, the Swiss ORSA requirements tend to be less restrictive than the Solvency II ones. For example, unlike in the Solvency II framework, exemptions and simplifications are allowed by the Swiss ORSA (under certain conditions). There are also less explicit rules regarding the integration of the Swiss ORSA in the decision-making process of companies, and no formal requirement regarding the need to assess the “continuous compliance” with regulatory capital.
Julie Laroche, Consultant ADDACTIS Worldwide.

Expertises

Focus on ORSA

What can be the present and future consequences of ORSA SST for Swiss companies’ risk management?

Very similar consequences as the ones observed in the EU insurance industry are expected. More specifically, the introduction of ORSA will push Swiss insurers towards a reinforced risk management culture. As ORSA requires a forward-looking approach on strategic business decisions, we expect an increasing involvement of the board, through CROs and risk committees, in the risk management framework. Indeed, through ORSA, insurers need to define their tolerance in risk taking and anticipate the potential consequences on any strategic business choices.
Even if the risk management culture was already in place for most Swiss insurance companies, there will be a deeper need for formal risk management practices, processes and a focus on corporate governance. In particular, the ownership and roles of key functions in risk activities should be clearly defined. In order to ensure the understanding of good risk management practice in terms of impacts on business and to set up enough controls, we also expect Swiss insurers to improve communication and training on risk matters.
All these modifications may require new internal resources in the actuarial field and in risk management. Also, some companies will have to re-think their organization to fully integrate the culture of risk management to every strategic business decision.
Julie Laroche, Consultant ADDACTIS Worldwide.

Expertises

Focus on ORSA

ORSA SST being considered a constraint so far, how to turn it into a necessity for the Swiss market?ORSA S2 and ORSA SST are pretty much the same, aren’t they?

s EU insurers, it is hoped that the Swiss insurance industry will rather use ORSA as a tool to monitor risk than view it as a constraint. ORSA evaluations should help key stakeholders of insurance companies to have a better understanding of their risks and of the potential consequences on their business, by quantifying in a prospective way the impacts of any change in their environment (e.g. economical changes, portfolio modifications, unexpected claims movements, etc.).
Then the challenge for Swiss insurers (as it is for EU insurers) will be to fully integrate ORSA in their processes of capital allocation and business optimization. ORSA results will allow insurance companies to assess their performance and to have more elements to make strategic decisions. To be more precise, Swiss insurers could benefit from this requirement during the process of product design and also by evaluating new strategies.
ORSA is indeed a new constraint that requires greater interaction between multiple stakeholders of insurance companies: actuaries who carry out the quantitative part (e.g. projections and stress tests), CROs who lead the process, risk management teams who coordinate and control, etc. However Swiss companies who succeed in doing so will be more competitive and more prepared to risk movements.
Julie Laroche, Consultant ADDACTIS Worldwide.

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