CASE STUDY
Optimization of CAT Reinsurance Processes in a P&C Insurance Company
Objectives
Streamline the reinsurance program
Improve efficiency in monitoring balances still in collection process
Simplify cash collections from diverse reinsurance programs
Implement a system to track cash coming in as an advance
Automate risk management calculations and reporting
Results
Reinsurance recoveries calculation transitioned from manual Excel spreadsheet to an automated system
Enhanced efficiency in monitoring balances
Simplified cash collections from varied reinsurance programs post-CAT events
Successful tracking of cash inflows before reimbursement of paid losses
Timely report generation for effective management of credit risk
They needed software that would prepare the cumbersome year end Schedule F report of reinsurance required by our state regulators. Duck Creek Reinsurance was the clear choice for us. They have a modern platform and a track record for agile, rapid implementation.
John M.
Chief Financial Officer
P&C Insurance Company
The Challenges
- Manual calculations and reporting
All calculations were performed manually and reports couldn’t be produced on a timely basis, making it difficult to manage credit risk associated with reinsurance during catastrophic events. - Complex reinsurance structure
The firm has a very complicated reinsurance structure, having various layers of excess of loss reinsurance, reinstatement premium protection, and quota share treaties with reinsurers in different geographical locations.
The Solutions
- The company adopted Duck Creek Reinsurance software for its modern platform and agile, rapid implementation.
- This solution facilitated tracking of the various layers of the reinsurance program and calculation of the required premium due to each reinsurer.
- The system also maintained a record of reinsurance billings and cash collected by reinsurer, with a proper classification of recoverable on paid loss or recoverable on advance billing.
The Impacts
Improved efficiency
The adoption of Duck Creek Reinsurance software eliminated manual calculations and improved the efficiency of the reinsurance process, including time saved for the year-end Schedule F report of reinsurance for state regulatory compliance.
Enhanced risk management
The timely generation of reports facilitated better management of the credit risk associated with reinsurance, even during CAT events.
Handling complex reinsurance structures
The Duck Creek Reinsurance software allowed for better management and understanding of the complex reinsurance structure.
About The Customer
The P&C insurance carrier insures homes and businesses for losses from hurricanes, tornadoes, other windstorms, and hail.
Location
N/A
Industry
Insurance
Products/ Services Utilized
Reinsurance
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