Project Specifications for ABZ Insurance Project id ELT/IN/001

Version 1.1, February 5, 2008

Project Specifications
TABLE OF CONTENTS

Project Objectives ........................................................................................................................... 3 Project work - snapshot.................................................................................................................... 4 Project Evaluation Criteria............................................................................................................... 6 Project Overview............................................................................................................................. 7 ABZ Insurance A to Z of insurance......................................................................................... 7 Functional Requirements................................................................................................................. 8 Modules identified........................................................................................................................... 9 Glossary of Insurance Terms......................................................................................................... 15 Typical Details maintained by the insurance application.............................................................. 19 Auto insurance policy................................................................................................................ 19 Home insurance policy.............................................................................................................. 19 First notice of loss...................................................................................................................... 19 Claim.......................................................................................................................................... 20 Product Details........................................................................................................................... 20

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Project Objectives
o Relate aspects and contents of Insurance & Technology overview and trends with the real
needs and scenarios

o Emphasize how technology has transformed insurance, emphasize it is important for

institutions to stay in line with technology and automation trends o Relate it is not one measure for all, its not one solution for all. Organizations need to choose solutions that are best suited for their business

o Projects in six different areas address some of the key aspects of property-casualty
insurance

o Though there are different projects, there is a level of interdependency indicating that the
need of the hour is integrated solutions

o Aspects of six projects/ systems are chosen in such a manner that despite different
business objectives there are certain common components; how can this be addressed in more contemporary approaches object/component based development / SOA and so on

o With the successful completion of these projects, individuals are expected to apply their
technical capabilities for the insurance solutions. Execution of these projects around defined SDLC lifecycle will get them exposed to near reality of workplace discipline.

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Project work - snapshot

Nature of project Development Development environment (for Java stream) Eclipse JBOSS J2EE Java Servlets, Java Server Pages, JDBC Oracle Database Server Development environment (for .Net stream) Visual Studio for .Net SQL Server Life cycle for each team of 4 people Understanding the requirements for the entire project Analysis of requirements Data flow diagrams, E-R Modeling Prototype development using iRise for a specific module (will be assigned) Design and development of the assigned module Testing of the assigned module Integration testing for the entire project Evaluation Presentation after every stage of life cycle Presentation at end of the project work

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Schedule
No. 1 Activity Requirements Analysis Timeline Day 1 to Day 3 Inputs Requirements Specification Outputs Presentation on the understanding of requirements, Data Flow Diagram, E-R Diagram 2 3 4 Prototyping Detail Design Development Day 4 to Day 5 Day 6 to Day 7 Day 8 to Day 12 Data Flow Diagram E-R Diagram Architecture Design Database design, Classes Program code, Unit test plans, Unit test results 5 6 Integration testing Presentation Day 13 to Day 14 Day 15 Integration test results Prototype

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Project Evaluation Criteria

Area Description of what is measured

How well the team has understood the requirements and articulated it. Requirement understanding & Elaboration Has the team broken down the high level requirements to precise low level details necessary for implementation Grades the high level technical solution - in terms of the modular / layered design, use of the right technologies at Overall Architecture / Technical Solution the right place, choices made (for e.g. writing PL/SQL versus JDBC) etc Quality of detailed design artifacts like data flow diagrams, ER diagrams, Prototype Detailed Design Quality of the DB design as well as design of application tier components Quality of code Clarity, level of documentation, exception handling, logging, memory management etc Quality/Comprehensiveness of test cases, actual test planning - unit testing approach, cases, functional testing, integration testing Based on demo - assessment of the product quality from a user perspective - UI, ease of use, number of defects, performance, conformance to requirements How well the team worked together as a unit, leadership, cooperation with other teams etc Adherence to basic standards established upfront like naming conventions etc Self explanatory Checks communication and presentation skills, ability to field questions etc

Testing

Final Product Quality Teamwork / Coordination with other teams Adherence to standards Adherence to timelines Presentation Quality

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Project Overview
ABZ Insurance A to Z of insurance
Insurance in India had been a regulated industry for a long time and to a large extent it had been monopolized by public sector companies. Gradual de-regulation in Insurance industry over past years has seen participation of a number of MNCs and a significant number of private sector companies. Entry of MNCs and private sector has made significant impact on insurance industry. Technology led innovation, cost-effective products and services have stirred-up dramatic growth in insurance industry. A healthy competition across providers has ensured enhanced services to the end customers. Because of a healthy competition, customers now have a choice of products and providers are challenged continuously to imbibe technology to provide better service to attract new customers and to reduce cost of services! ABZ Insurance is promoted by ABZ Ltd, a reputed business house and a leading Property and Casualty Insurance global corporation, Safe-ways Inc. ABZ Insurance has launched Motor and Home Insurance for the Indian market. Motor and Home Insurance is a highly competitive market place and requires innovation besides effective ways to distribute products/services and a winning customer service. ABZ has deployed Safe-ways core policy administration systems. Considering local market place and infrastructure realities, ABZ insurance has decided to develop scalable front-end solutions for product service distribution and customer service. Given that ABZ is setting up a new business, it has been decided that the systems must be developed using scalable technology platform. Also, the competitive market environment demands that the chosen technology and frame-work allow not only quick deployment of solutions but also change / enhance solutions with minimal effort to address time-to-market challenges and stay ahead of competition. As part of this initiative, ABZ plans to deploy web based solutions for customer acquisition and customer service. Additionally, the business users felt the need to re-develop the Rating Engine that manages & computes the Insurance premium in the core Policy system. This is needed to reflect the local business needs. It is decided to develop this as a separate subsystem and interface to the Core Policy system for computing Policy premiums.

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Functional Requirements
Key objectives of this system are to Provide information related to the products & services offered by ABZ Insurance Allow potential customers to purchase various insurance products Allow self service to the customers so that

o they dont need to rush to the branch for routine queries, or policy related support
services

o they are not constrained to plan and schedule such needs to synchronize with the
normal working hours of the branch

Allow customer service officers to record customer requests and track their completion Allow customer service officers to reflect the required changes there and then Allow customer service officers to respond to customer queries related to their Policies efficiently Allow Agents to effectively sell (distribute) company products to the customers as well as provide required services

System to use common components for both customer self service, Agent as well as customer service officer usage to ensure integrity, consistency and above all minimize effort to implement new services or changes in system

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Modules identified
1. Insurance Product portal
For a common visitor, Web based front-end system should a. Provide details of products and services offered by the company

b. Allow sign-up for new products & services offered c. Provide a simulator, i.e. by capturing basic customer information and needs,
suggest suitable products and offer a quick quote

d. For the visitors choosing to inquire about specific products and pricing, seek
confirmation if they would like a personal consultation and accordingly capture preferred meeting date and time

2. Campaign management a. Campaign management system will allow company officers to launch various
products & services to different customer segments thru various focused campaigns. Company will create potential customer data for the campaigns (including cross opportunity for existing customers). Campaign system will allow Officers to assign a set of potential customers to the agents. Also insurance company officers will have the ability to assign and re-assign customers to agents for customer service and support. Agents system will be closely integrated with these systems. b. For product / service purchase requests received over web, allow company officer to attach an agent for personal consultation and follow up c. Allow a report / query on progress made on outstanding purchase requests i. Number of requests received today, received month to date, ii. Average number of daily requests iii. Average conversion of such requests iv. Agent wise conversion efficiency v. Aging of requests

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3. eAgency
System for agents will be closely linked with the campaign management system in the company. Agency system will facilitate the following for the agents a. Selling company products & services to the potential customers and crossselling additional products and services to the existing customers

b. Provide basic service to the customers information on products, change of

address etc (as in self service system). Only difference is that all changes / information captured by agents will be reflected on company systems only after validation from an officer of the company c. Provide customer service by facilitating recording and follow-up of claims

i. Like customer self-service option to record First Notice of Loss (FNOL)

ii. Update customer on progress made on claim processing by follow up with various agencies involved surveyor, dealer/workshop, insurance company d. Ability to manage their assigned customer base effectively agents will be able to capture customer specific data for them to manage the relationship effectively e. All activities above will be managed thru automated work Queues i. A work queue that has all details to allow an agent to sell company products and services this will include option to create prospects, option to select prospect (s) to work on, select a list of prospects that need to be followed up on a specific date, capture prospects needs and details related to the products offered, ability to provide a proposal / quote to interested customers ii. A separate Work Queue to facilitate Claims Processing related support to the assigned customers iii. A separate Work Queue to facilitate general customer service f. Allow assigned agents to capture details of follow up and required customer data required for selling the product g. Allow agents to create new prospects h. Allow assigned agents to mark requests as converted

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i. j. Agents will have access to assigned customers data to provide various services to the customers Based on customer & policy data, allow agents to follow up with the customers for the renewal of Policies and collection of premium k. Generate a quick quote for a product or service l. Provide facility to track commission earned

4. Customer self service

For existing customers, system should provide secured access over the internet to the self service system. Self service System should allow a customer to a. Change his/her password b. View insurance Policy details c. Lodge First Notice Of Loss request for a claim d. View history of claims filed e. View processing status of filed insurance claims f. Change his/her contact information (address, e-mail id, phone number etc.) g. Record on-the floor requests h. Post a query i. j. See response to queries / on the floor requests All changes must be recorded only after displaying old and new information and secondary confirmation k. Based on his/her profile, should be able to find out new products and services to which customer is eligible l. Sign up for a product promotion m. Ask for a quick quote on a product n. Capture details of all other insurance policies held by customer

5. Customer service
Customer Service System will be used by Customer Service Officers. System should a. Provide ability to pull up customer information as in Customer Self-service system

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b. Allow capture, view and resolve on-the floor requests c. Allow response to queries posted by customers

d. Based on customer instruction, it should allow Customer Service Officer to carry

out all activities as in self service (with the exception of password change)

e. Customer Service Officer must input mode of customer interaction over the
phone or branch walk-in Each customer session must be tagged and timed along with transaction stamps.

6. Rating
Auto insurance System maintains Base Premium for each of the Vehicle Model, Make and Year combinations. This base premium will be charged for each of the drivers as premium. The following factors are applied on this base premium in the given sequence below, to compute the final premium to be charged to the customer. While the premium is computed, the following factors are applied in the order listed below. Premium computed from one factor is carried over as input to the next factor for application. This is called Rating sequence. Business Rule Vehicle Type Factor Commercial Vehicle Personal Vehicle Proof of earlier Insurance exists? Driver Class Factor: Driver age < 20 & Female Driver age > 20 & Female & Not married Drive age < 20 & Male Driver age > 20 & Male & Not married Driver age > 20 & Female & Married Driver age > 20 & Male & Married Driver > 30 & (Married or unmarried) Vehicle has airbags and advanced safety features Vehicle has anti-theft alarm Driver Traffic Violation Factor: Premium Impact Increase Base premium by 15% No premium impact If yes - Offer 3% premium discount Load 2.5% Load 2 % Load 3 % Load 2.5 % No premium impact Load 1 % No premium impact Offer 2.5% discount Offer 1.5% discount

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Traffic violations >=5 Traffic Violations > 3 instances & <5 Traffic Violations > 2 instances Traffic Violations > 1 instances No Traffic Violations Term Factor Policy Term 1 Year Policy Term 3 Years Home insurance System maintains Base Premium for each dwelling type (Single family home, Town home, condominium) and the locality combinations. The following factors are applied on this base premium in the given sequence below, to compute the final premium to be charged to the customer. While the premium is computed, the following factors are applied in the order listed below. Premium computed from one factor is carried over as input to the next factor for application. This is called Rating sequence. Business Rule Condition More than 5 years old 5 years or less Construction Frame home Brick home Safety Systems Burglar alarm installed Smoke detector or sprinkler system installed Less than 1 Km. from fire station Smokers Any smokers in the house Supplemental Catastrophic Insurance Loyalty Offer 3% premium discount Offer 2% premium discount Offer 1% premium discount If yes increase premium by 5% If exists offer 3% premium discount Premium Impact Increase Base premium by 15% No premium impact If yes - Offer 3% premium discount Reject Policy Issuance Load 9% Load 6.5% Load 4 % No impact No Impact Load 0.4% on premium

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Holds auto insurance with ABZ Been a customer for > 3 and < 5 years Been a customer for 5 years or more Retiree Retired and age over 55 If yes, offer 5% premium discount If yes, offer 5% premium discount If yes, offer 10% premium discount Offer 5% premium discount

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Glossary of Insurance Terms

Actuary: An individual employed by an insurance company to calculate premium rates, reserves, dividends and other important figures using risk factors obtained from experience tables. Agent: An authorized and licensed representative of an insurance company who sells and services insurance policies. Agents represent the insurance company and typically only sell policies from that company. Applicant: The person applying for the insurance policy. The applicant may be different from the proposed insured or the policy owner. Application: Forms required by the insurance company which the proposed insured completes when requesting coverage from an insurer. Approved: A status that indicates the insurance company has completed underwriting and agrees to issue a policy to the proposed insured. Avocation: This refers to either an occupation or an activity the insured participates in. Beneficiary: A person(s) designated by the policy owner to receive the proceeds of an insurance policy upon the death of the insured. Broker: A licensed representative who sells and services insurance policies. Brokers represent their customers and are usually contracted to offer insurance products from several different insurance companies. Carrier: Another name for an insurance company. Claim: Notification to an insurance company that payment of the benefit is due under the terms of the policy. Commissions: A fee or percentage of premium allowed to a salesperson or agent for services rendered. Effective Date: The date an insurance policy goes into effect. This is sometimes referred to as the Policy Date. Electronic Funds Transfer (EFT): An arrangement in which premium payments are drawn from an insured's bank account. Evidence of Insurability: Factual information used by insurance companies to determine an applicants qualification for insurance. Examples of information used may include paramedical exams, medical records, application statements, and motor vehicle reports among others.

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Exclusions: Specific conditions or circumstances listed in an insurance policy for which the policy will not provide benefit payments. Expiration Date: The date on which an insurance policy ceases to provide coverage on the insured. Guaranteed Renewable: An insurance policy provision that guarantees an insurance policy will continue in force provided the policy premiums are paid on time. An insurance company can typically only cancel a guaranteed renewable insurance policy for non-payment of premium. Insurability: General acceptability by an insurance company of an applicant for insurance based on underwriting review, which may include items such as the applicant's current health status, medical history and driving record among others. Insurable Interest: The existence of potential financial loss on the part of the policy owner and/or beneficiary(s) in the event of the death of the insured. The policy owner and any beneficiaries must have an insurable interest. Insurance: A system for reducing risk by transferring the risks of several individual entities to one entity, such as an insurance company. Each individual entity contributes monetarily (premiums) to cover the risk assumed by the insurance company. Insurance Company: A company that provides insurance coverage through the issuance of insurance policies. This is also referred to as the Insurer. Insurance Policy: The physical, written document issued by an insurance company to the policy owner. The insurance policy represents the written contract between the insurance company and the policy owner. Insured: The individual covered by an insurance policy. Issue Date: The actual date an insurance policy is issued. This may also be the effective date of the policy. Lapse: The termination of an insurance policy due to non-payment of premium. Lapse Notice: The notice provided in writing to the policy owner that the policy has lapsed. Level Premium: A premium that remains the same throughout the period specified in the insurance policy. Mode: The term of premium payments for an insurance policy. Typical modes include monthly, quarterly, semi-annual and annual. Multi-Year Premium Mode: A premium payment option where future annual premiums are paid in advance at a discount. Orphan: A policy owner who is not currently being serviced by the writing agent/broker.

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Payor: The person making premium payments on a policy. Policy: The written document issued by an insurance company to a policy owner. The policy represents the insurance contract between the insurance company and the policy owner. Policy Anniversary: The anniversary of the date of issue as shown in the policy. Policy Date: The date the insurance policy becomes effective. Policy Fee: A charge for policy administration expenses incurred by the insurance company. The policy fee is usually included in the premium. Policy Owner: The individual who owns an insurance policy and who has all contractual rights related to the insurance policy. The policy owner may or may not be the same person as the insured, payor or beneficiary. Premium: The amount of money to be paid by the policy owner to the insurance company for the benefits provided under an insurance policy. Premium Mode: The frequency of premium payments elected by the policy owner. Typical premium modes include monthly, quarterly, semi-annual and annual. Premium Notice: A notice from an insurance company to a policy owner that a premium will be due on a given date. Premium Rate: The price per unit of insurance. Premium Receipt: The receipt given a policy owner for the payment of a premium. Provision: A statement or clause, found in an insurance policy, to establish some term of the contract. Quote: The estimated premium amount for an applicant based on several factors including type of insurance, coverage amount, length of coverage, age, gender, health and medical history, family history, build and approximate rating class. All quotes are preliminary estimates with final rates determined by insurance company underwriting. Reinstatement: A policy provision that allows a policy to be restored from a lapsed status. This is usually allowed during the 31 days following the expiration of an insurance policy's grace period. Renewal: The process of continuing a policy by paying the premium due. Reserve: The amount of money an insurance company holds which, with future premiums and an assumed rate of interest, will pay all contractual obligations as they become due. Insurance company reserves are an important factor used to establish a company's industry ratings.

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Rider: A special provision attached to a policy that either expands or restricts the benefits of the policy. Exclusion riders typically exclude certain conditions from coverage. Risk: The probability of injury, illness or death associated with an insured. Risk Classification: The process by which underwriting determines the risk associated with an applicant and assigns an appropriate rating class to the policy. Third-Party Owner: A policy owner who is not the insured. Underwriting: The process of evaluating applications for insurance based on an established set of guidelines. Underwriting determines the risk associated with an applicant and either assigns the appropriate rating class for the policy or declines to offer a policy.

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Typical Details maintained by the insurance application

Auto insurance policy Policy ID Customer Details Name, Address, Contact Details Policy Start Date Policy Renewal Date Agent ID Vehicle details Registration number, Year of make, Make, Model, Anti-theft devices, Annual mileage, Type of use, approximate market value Coverage details Deductible, Rental reimbursement, Emergency road service, Liability coverage Premium Payable Premium payment schedule Driver Details Name, Date of Birth, Gender, Licence obtained date, Occupation

Home insurance policy Policy ID Customer Details Name, Address, Contact Details Policy Start Date Policy Renewal Date Agent ID Property details Age of property, value of property, contents and their value Coverage details Deductible, Theft coverage, Accident/flood coverage Premium Payable Premium payment schedule

First notice of loss Category of loss Policy Number Accident / incident date Location

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Accident / Incident description Authority contacted / reported Insured object and related details o For motor vehicle year of make, make, model, registration number, etc. driver name, driver license no, issuing authority, expiry date o For house Property details Occupant details Damage details Estimated amount of damage Details of any other insurance with the damaged object Witness details, if any Contact person Personal injuries self Personal injuries third party

Claim

Claim ID Policy Number Accident / incident date Location Accident / Incident description Authority contacted / reported Insured object and related details o For motor vehicle year of make, make, model, registration number, etc. driver name, driver license no, issuing authority, expiry date o For house Property details Occupant details Damage details Details of any other insurance with the damaged object Witness details, if any Contact person Personal injuries self Date of claim Amount of claim Details of claim Claim Status

Product Details Product ID Rating details

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