Enterprise Resource Planning System for Insurance Sector

The Indian Insurance industry is a booming one which has several national and international participants who compete for excellence. With several reforms and policy ordinances, the Indian insurance sector has witnessed enormous growing in the recent yesteryear.

India holding about 17 % of the universe ‘s population is a mostly untapped market. About 80 % of the Indian population being without a life, wellness and non – life insurance, a turning figure of insurance companies are now emerging in the Indian insurance sector. With the opening up of the economic system, several international leaders in the insurance sector are seeking to venture into the India insurance industry.

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The growing in the insurance industry straight impacts the reinsurance industry. Reinsurance suppliers are fundamentally companies that provide insurance screen to insurance companies so as to cover their hazard. With the growing in the sum of insurance merchandises sold by the insurance companies their hazard constituent goes on increasing. So as to cover this hazard, companies resort to reinsurance. Thus the reinsurance market is all turning at a rapid gait.

The growing of the Reinsurance industry in India is coupled with a figure of challenges. Challenges faced by the reinsurance industry include shriveling borders, increasing competition etc. In order to run into the challenges, reinsurance companies across the Earth have begun leveraging to a great extent on their information and communicating engineerings.

Reinsurance houses are utilizing enterprise direction solutions to increase productiveness, salvage on disbursals, to obtain higher client satisfaction, thereby ensuing into client keeping and to better gross revenues public presentation.

General Insurance Corporation of India ( GIC Re ) is the exclusive reinsurance company in the domestic reinsurance market in India with more than three decennaries of experience in the Re-Insurance concern. GIC is headquartered in Mumbai.

In India, GIC provide reinsurance to the direct insurance company as it is the exclusive reinsurer in the market of domestic reinsurance. It is one of the leaders in the facultative arrangements and domestic companies ‘ pact programmes.

OBJECTIVES FOR ENTERPRISE RESOURCE PLANNING SYSTEM

The cardinal aims for originating ERP execution were as follows:

So as to retain leading place in the national ( Indian ) reinsurance market.

The purpose of emerging as the leader of reinsurance in the Afro – Asiatic markets.

To obtain an incorporate position of all concern minutess.

MAJOR BUSINESS CHALLENGES FACED BY GIC RE

Customer-Centricity

The alteration in focal point of the organisation to being customer-centricity created a figure of issues for the company.

It became of import to hold optimum cognition of all the client sections.

Customized merchandises and services were required to designed to run into the demands of each of the identified client sections.

It became of import to follow cross merchandising of merchandises and services as an of import growing scheme.

It besides became of import to supply any clip and any topographic point reachability to the clients.

Competition

The turning figure of participants in the market created an environment of intense competition

In order to prolong such degrees of competition it became imperative for the company to follow new schemes and place agencies of procuring a competitory advantage over its rivals.

Globalization

Expansion of company operations across multiple geographical locations besides made it necessary for GIC Re to place agencies of effectual monitoring and control.

Expansion besides increased the degree of competition by adding new rivals from the new geographical locations.

Merchandise Commoditization

The addition in competition was impacting the company ‘s net income borders.

It became perfectly necessary for the company to separate its trade name from rivals.

Lower client trueness and increasing monetary value sensitiveness were besides step menaces to GIC Re.

Consolidation

It was of import to convey about a consolidation across the organisation so as to present a clear value to its clients.

Conformity

Expansion of operations across multiple geographical locations made its imperative to follow with multi-national ordinances.

Major IT CHALLENGES FACED BY GIC RE

Data Quality

Datas maintained by the organisation was fragmented by the line of concern, the subdivisions, the different geographical locations etc.

It was of import to consolidate this information and supply high quality of merchandise and operations related informations.

Procedure Integration

It was of import to standardise and streamline cross functional procedures and develop and integrated work flow.

The company was enduring from value escape due to non integrating of systems.

Bequest IT Systems

The bequest system used by the company did non reflect the alteration in focal point from being a contract centric to client centric insurance supplier.

Decrease of Operation Complexity

The company used a figure of applications to pull off the day-to-day activities.

As a consequence, a figure of interfaces had to be monitored and managed which proved to be really hard.

It therefore became of import to cut down the figure of interfaces and convey about standardisation across the interfaces.

Expectation FROM ERP

Decrease in overall cost through improved efficiency and increased productiveness

Drive concern invention

To a give a competitory advantage to the company over its rivals

Driver for concern growing

Improve overall client experience and satisfaction

Ensure regulative conformity

Support planetary operations

Create new gross watercourses for the company

Ensure growing of bing gross watercourses

CHOICE OF SAP

The major factors lending to the pick of SAP are as follows:

Integrated Enterprise platform for transacting GIC ‘s concern

The company required a platform that would incorporate all the procedures and processs across the endeavor.

The system was required to standardise all procedures and streamline set of procedures across the organisation instead than streamlining big figure of processs.

The company expected the have an endeavor broad visibleness of concern operations.

SAP Reinsurance solution being used by Global Industry leaders – Munich Re and Hannover Re

One of the major lending factors to taking SAP was the company ‘s biggest rival and the planetary industry leader Munich Re and Hannover Re had implement SAP Reinsurance system.

Adoption of the planetary best patterns

By 2005, SAP Insurance had about all insurance service suppliers running it.

SAP had in the yesteryear implemented both the insurance and reinsurance bundles for multiple clients.

This enabled SAP to derive an apprehension of the planetary best patterns in the prevalent in the industry.

GIC Re hoped to harvest the benefits of this cognition in their ain implement of SAP Reinsurance.

Most companies who had antecedently implemented ERP had strong positive experience with SAP for their insurance portfolio

ERP IMPLEMENTATION START DATE Early 2005

ERP GO LIVE DATE February 2006

SAP VERSION SAP R/3 Version 4.7

GEOGRAPHICAL SCOPE Offices in India, London and Dubai

SAP MODULES IMPLEMENTED

SAP FS-RI – Reinsurance

SAP FS-RI is an insurance solution that enables reinsurance houses, direct insurance companies and agents to accomplish a reinsurance procedure that is wholly incorporate and streamlined.

SAP FS-CD – Collections / Expenses

SAP FS-CD is a solution designed for insurance service suppliers to standardise and streamline their charge and expense activities for their policyholders and bureau holders.

SAP IM-IC ( CFM ) – Investing Management

SAP IM-IC ( CFM ) faculty provides utile tools for coverage of WBS which are in advancement, PO committednesss and assets that have been capitalized.

SAP FI-CO – Finance

The SAP FI-CO faculty can be viewed as the nucleus of the integrated SAP system as it deals with the pecuniary impacts on concern and other faculties of SAP.

SAP HR – Human Resources

SAP HR is the largest faculty implemented

It deals with the direction of human resources and human capital

SAP BIW – Business Intelligence

SAP BIW is the concern intelligence faculty that provides analytical, coverage and informations warehousing solution

Execution CHALLENGES

First SAP Reinsurance ( FS-RI ) execution outside Europe.

First SAP FS-CD Implementation in India.

First SAP IM-IC execution in India in an Insurance/Reinsurance environment.

One of the few Active Reinsurers in the universe utilizing SAP FS-RI

Legacy informations Migration

Customisation of Reinsurance Module ( FS-RI )

Hazard Manager in FS-RI ( Facultative Business ) had non yet been implemented even in Europe

IMPLEMENTATION HIGHLIGHTS

Opportunity to critically re-look the company ‘s concern procedures and patterns and incorporate alterations wheresoever required.

Elimination of informations incompatibility by rectifying, formalizing and cleansing bequest informations.

Opportunity to streamline the administration by following the planetary best patterns in the industry

Business Benefits

Tight integrating between underwriting and proficient Accounting procedures thereby supplying better concern focal point.

Integrated procedures extinguishing about all redundancies and inter-departmental rapprochements.

Increased mechanization reduced manual intercession and improved informations quality.

Improved reserving procedure ( tracking the development of outstanding loss militias ) .

FINANCIAL & A ; STRATEGIC BENEFITS

Sap allowed visibleness of all assets

Standardized rating of all assets were achieved

Daily updates to the investing portfolio enable the company to accomplish integrated investing direction

Effective existent clip hazard analysis

Entire COST OF OWNERSHIP

95 % of the company ‘s demands were met by th standard solution offered by SAP and minimum customization was required

OPERATIONAL BENEFITS

The operation benefits as evaluated by the company after two old ages of execution are as follows:

Cardinal PERFORMANCE INDICATORS ( KPI )

Impact

Time to mensurate public presentation

-70 %

Time to be after for new undertakings and activities

-30 %

Time to public presentation market hazard analysis

-80 %

Attempts to map beginnings of hazard

-80 %

Reporting Flexibility

+90 %

Quality of Reports

+80 %

Quality of Portfolio rating

+90 %

Quality of dealing function

+90 %

FUTURE PLANS

Up step from SAP R/3 Version 4.7 to SAP ECC 6.0 platform

Connecting offices in Moscow, Malaysia and South Africa to the upgraded ERP web

General Insurance Corporation of India has derived important benefits from execution of SAP Reinsurance. From this instance it is apparent that SAP has the potency of being a step beginning of improved efficiency and competitory advantage for insurance service suppliers.

Appendix

[ 1 ] Monitor Performance: Executive Dashboard

[ 2 ] CEO Dashboard

[ 3 ] Gross saless Dashboard

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