Insurance companies operate on an incredibly competitive market

The flexibility of adapting our offer to the clients’ requirements, business process efficiency and optimisation of operations are of key importance here. Liberty Direct has decided to implement the analytical-reporting system based on the data warehouse and provide instant access to updated information. On its basis, the company can quickly make better business decisions.

Liberty Direct is one of the fastest growing property insurers on the market. It has been operating in Poland since 2007 within the sphere of services for individual clients and, during this time, the level of its turnover has multiplied. The company belongs to the international insurance group Liberty Mutual Insurance, and renders complex insurance services in 29 countries in the Americas, Europe and Asia.
Among the key elements of Liberty Direct’s strategy, the company offers motorvehicle and home insurance to individual clients at a good price, whilst simultaneously ensuring a high quality service, particularly within the scope of damage liquidation. The company has already insured over 400 thousand vehicles and, in 2012, collected 268.7 million PLN in premiums. The product distribution network includes over 400 multi-agencies, direct channels – Internet and phone, as well as bancassurance. Liberty Direct also insures vehicles offered by second-hand car dealers.

In 2010, the Management Board of Liberty Direct decided that the reporting tool held, which allows for the analysis of business results, ceased to be sufficient due to the dynamic growth in the number of customers and business complexity.

-The number of customers was growing, there were new products, but principally the number of management staff was increasing, taking over the increasingly greater responsibility for business management. We needed solutions allowing for the easy monitoring of the most important business ratios, and thus improved pace, accuracy and efficiency in taking operating, tactical and strategic decisions. We intended to simplify the mechanisms for access to information for the management of various levels, in particular the medium and lower level, by creating a single source of information, and to introduce a convenient user interface - says Marcin Warszewski, Insurance Technology Director at Liberty Direct.

Liberty Direct needed quick answers to such questions as, for example, how much time it takes to acquire a new customer, which products gather the most interest and why, which forms of customer access are most effective, and which consultants are the most effective. Obtaining answers to such questions was difficult and time consuming due to limited reporting possibilities. All reports were generated either directly from the transaction system or data was imported manually from various source systems to Excel files. -We decided we needed a solution that would gather all the necessary data in one place and streamline executive reporting - says Marcin Warszewski.

Selection of the analytical-reporting solution

Liberty Direct carried out a bidding procedure where it searched for both the technology and supplier of the solution at the same time. The decision was made on an analytical-reporting environment based on the Microsoft Business Intelligence platform and the Microsoft SQL Server data warehouse.

Data Warehouse Architecture at Liberty Direct

-We are a rather small but quickly growing company, so we were interested in a solution we could afford and which would develop along with us. We have selected Microsoft technology, as it met all our requirements regarding functionality at an attractive price. As for the contractor, we selected Bonair due to their experience with the execution of the Business Intelligence solution and its team of excellent, competent specialists - says Marcin Warszewski.

The analytical and reporting needs of Liberty Direct include, among others, such business areas as damage liquidation, sales and renewal of insurance policies, and customer service. The solution based on the data warehouse supports and supplements all activities from the first contact, through the sale of the insurance policy, handling possible damages and payment of compensation, through policy renewal. It includes all the aspects important from the point of view of the operation of an insurance institution. At the same time, during each of the above stages, it provides reliable and complete information.

The basic element of the solution is the data warehouse, which also contains advanced the business logic of Liberty Direct. Fundamental processes and ratios were mapped and implemented by Bonair’s Business Intelligence team as a multiphase process of automatic processing, preparation and continuously making important data available to decision-makers and analysts.

-The data warehouse is supplied with data from various systems which have been previously harmonised and cleared. For reporting, the popular programme Excel is used, which cooperates with state-of-the-art tools: Microsoft Power Pivot and Power View. Such solution allows users to report and analyse the data at any time in the required layout - says Roman Koleśnik, Leading Consultant of the Project on the part of Bonair.

Changes during deployment

Deployment commenced in 2010 and, together with further extensions, took over two years. The works were carried out in stages. First of all, the new solutions were implemented in the area of damage liquidation, next in sales and post-sale customer service.

-We planned that the implementation would last a year, but the dynamic growth of our business significantly changed the scope of the project during its course - says Justyna Mazur, Manager for Information and Data Quality Management, and simultaneously Project Manager on the part of Liberty.

-At the start of the project, we assumed that the increase in the data volume at the warehouse would be at the level of 30 per cent per year. However, it turned out that the dynamics of the client’s business growth is twice as big and, presently, after two years of project operation, we have already achieved what was planned after five years. New areas of business appeared, as well as new needs. The client saw that the data warehouse offers many more opportunities than previously assumed and that the data collected can be used in other business areas than before - says Rafał Szczęsny, Project Manager from Bonair.

During project implementation, Liberty Direct’s assumption as to the use of the data warehouse also changed. At first, the plans assumed the automation of the generation of standard business reports, allowing for the reduced involvement of IT specialists and the Executive Information Team in the process of report preparation. However, the decision was made on the application of self-service BI, namely direct flexible access to the data warehouse, where the analyst, having the relevant tools, can process data in different ways.

-In the last two years, the known software generally applied in business, Excel, has been enriched with new easy to use tools: Power Pivot and Power View. These allow for individual access to data, the simple generation of own data models, and the quick generation of transparent and attractive reports. Therefore, we proposed such a solution to the client - says Waldemar Bieńko, Consultant from Bonair.

-We decided that allowing users flexible access to the data one can process while preparing the necessary reports on a continuous basis, offers much greater opportunities than predefined reports - says Justyna Mazur.

Conscious management, right decisions

The data warehouse is supplied from various business systems used at Liberty Direct: the transaction system supporting sales, policy renewal and damage liquidation, the Call Center support system, and financial SAP. Bonair harmonised and integrated data and prepared them in such a way that their use is quick and easy.

-The data warehouse contains not only the aggregated source data, we placed the entire business logic there. Inside the data warehouse, a number of calculations are performed that, from the data collected from the product system, create business information. For example, such ratios are calculated as customer conversion at particular stages of sale, or product rates of return - says Roman Koleśnik.

To the question about the greatest challenge during implementation, Ewa Polańska-Cichopek, Deployment Coordinator on the part of Liberty, replies that it was the standardisation of measures and ratios of business process operation.

-These are organisational issues, but they required detailing during implementation. Owing to this, in the entire company, when making decisions, everyone uses the same information and data. We also devoted a large amount of time to the verification of the correctness of calculations at the data warehouse, which was more difficult, as often there was no point of reference, because an entire range of new measures and ratios was created.

The key business areas at Liberty Direct which presently use the data warehouse are as follows: damage liquidation, sales and post-sale customer service. The data warehouse also constitutes one of the data sources supplying the system of executive financial reporting and the dedicated system for risk modelling and premium calculation. It also cooperates with the product system, systems for reserve analysis, system for price definition and supplies the system for budgeting and controlling.

Management support in the sphere of Damage Liquidation

Data regarding damages are reported and analysed principally by the Damage Liquidation Department and the Actuarial Department. The data warehouse collects data regarding damage both from the phase of its registration, and from the phase of its liquidation. On this basis, one can track the course of the damage liquidation process and funds reserved for this purpose, analyse the amounts of compensation paid, damage liquidation costs, and check the recourse status, or the change in the number of damages in a particular time period, region, or population.

-Damage liquidation is a vast area generating large volumes of data, we can currently use and analyse in many ways. For example, we can see on an on-going basis, how the cost of motor vehicle damage liquidations change when divided into, for example, make, year of manufacture, parts, repair methods – which part passes through workshops, which part is paid in cash. This allows for making more conscious and appropriate decisions - says Marcin Warszewski.

Sales support

The Sales area is used by the following divisions: Call Center, Outgoing Sales, Purchase-Sale Agreement Handling, and Regional Sales. Here, all data are gathered as regards insurance policies, from the first quotations, through recalculations of premiums, through policy sale. Sales can be analysed in many contexts, including time, according to individual policy properties, according to the properties of the insured, insurer or insured item (e.g. vehicle makes and models).

Benefits from data warehouse deployment

  • Coherent, harmonised and complete data in one place.
  • Easier and quicker access to updated information.
  • Significant improvement in the reporting process and preparation of analyses, both in the aspect of speed and range.
  • Set of ready reports showing the necessary information in just a few seconds.
  • Obtaining access to historical data.
  • Improved safety – possibility of defining access rights to data for users according to advanced rules.

Analyses can also be made in the aspect of risk, products offered, activities carried out on the insurance policy or quotation, as well as according to the organisational structure of sales departments, divided into teams, consultants, regions or agencies. The key directions of analyses focus on the quantitative and value analysis of insurance policies sold, time of the first quotation until the finalisation of sales, and the activity of consultants selling insurance policies.

-Presently, we cooperate with approx. 4,000 agents and approx. 400 multi-agencies. Owing to the data warehouse, we can analyse sales in almost every aspect. Previously, the majority of the analyses could not be obtained - says Justyna Mazur.

Servicing support

In the Servicing area, namely post-sales customer service, the key users include the teams of: Renewal, Customer Service and Payments. These can use the data describing all activities and events occurring during the policy term, including the activities of consultants, phone calls, correspondence with the customer. This allows for analysing both the rate of return on customers, the cost of their servicing, as well as the quality of servicing the department’s work, namely how much time passes from the notification to the closure of the case, how effective consultants are, or how service quality changes in time.

Executive Reporting support

The Executive Reporting area is used by actuarial analysts, financial analysts and Management. This area combines data in the area of damages and sales – allows for analysing the policy portfolio and costs incurred, allowing for the analysis of the rate of return at the level of a single policy, or a single customer. It makes available calculations and ratios important from the point of view of the company’s present and future business, both in the actuarial and financial aspect.

An important goal achieved with the support of Executive Reporting is the process of closing and settling months, observing the rule of inalterability of historical data. On the basis of the data from this area, monthly data are reported both to the supervisory institutions of the insurance market, and to the company’s headquarters. Benefits of data warehouse deployment.

Previously, access to information was complex and time consuming, particularly for managers at the medium and higher level, who had to wait several days for reports ordered. -Reports were prepared by IT or MIS Departments on the basis of the source system, on combined data sets from various sources obtained manually. Existing aggregations often did not have documented clear specifications, and their control mechanisms were based on manual checks and proved insufficient - says Ewa Polańska-Cichopek.

There were also other problems in the process of obtaining reports: poorly documented task descriptions (principally e-mails), encumbering of the transaction system with the inquiries processed, the need for manual data integration from many sets, and the risk of analysis based on incomplete or inaccurate data.

The deployment of the data warehouse has eliminated such inconveniences, and provided for a new quality of supporting decision-making processes. The time for obtaining knowledge on the cause of the event has been cut down significantly.

-At present, we continuously observe what happened and, while processing data, can easily obtain the answer to the question of why this happened. If, for example, the sales level changes, we continue to obtain information regarding particular regions, specific agents, a particular customer or product groups - says Marcin Warszewski.

The detection of the cause right now is immediate – it is enough to analyse the data at the data warehouse. The time for obtaining the answer as to why something is happening has been drastically cut down. This is the basis for making a better decision in a shorter time.
Marcin Warszewski sees the benefits of the implementation of the data warehouse not only in the fact that the data are ordered, collected in one place and that access to them is quick and easy, but also in the employees’ approach to the management and decision-making basics.

-I can see that, together with easy access to the data warehouse and the possibility of obtaining quick answers to the questions asked, people have started to ask such questions and make decisions on the basis of the analysis of facts and figures - says Marcin Warszewski.

Further development planned

Liberty Direct has been using the data warehouse for over a year in the area of Damage Liquidation, for about nine months in the Sales area, and for six months in the Servicing area. This is enough time to be able to assess the usefulness of the solution and the quality of implementation. -We are satisfied both with the selected Microsoft technology, and the implementation partner, Bonair. A professional, competent, communicative team, involved in the project. What I appreciate most in the cooperation with Bonair is the ability of placing oneself in the role of the client and understanding what the client really needs. During the project, we built significant mutual trust. Our cooperation was good - says Justyna Mazur.

Liberty Direct plans to develop the further use of the data warehouse. -The business is changing all the time, the company continues to grow, we are developing new projects, new sales channels, and the data needing to be analysed are growing. Having better access to information, every day we make hundreds of improved minor decisions. This is very important when one operates on a market that is incredibly competitive, where the business is run with very low margins. The insurance market requires continuous adjustment of the offer and internal processes. Process efficiency and optimisation of activities are of key importance here - says Marcin Warszewski. ■

Deployment Facts

Business Intelligence Platform, including the data warehouse based on the Microsoft SQL Server.

Liberty Direct is one of the fastest developing property insurers on the market.
It offers motor vehicle and home insurance for individual customers. The product distribution network comprises over 400 multi-agencies, direct channels, Internet and phone, as well as bancassurance and selected car dealers.

September 2010 – April 2013 your social media marketing partner