The document describes a data warehousing showcase at American Modern Insurance. It provides background on the company and its initiative to build an enterprise data warehouse and knowledge management architecture. The showcase agenda includes presentations on the data warehouse, data model, and information management. The data warehouse implementation follows Kimball's approach and provides benefits like a single version of truth and integrated data.

1. SWOC DAMA 2008 Showcase at American Modern Insurance February 21, 2008

2. Showcase Agenda Background/Business Case 20 minutes Sandy Wagner Data Warehouse – AIIM 20 minutes Latha Subramanian Data Model – AIIM 20 minutes Duke Ganote Information Management – AIIM 20 minutes Dan Daly Q& A – Duke/Sandy/Latha/Dan 20 minutes

3. American Modern Insurance Company Background Founded in 1938 as a consumer finance company Provider of highly focused, specialty insurance products Positioned to grow into a multi-billion dollar organization Entrepreneurial spirit & deep commitment of employees Approximately 1200 employees country-wide, with 1000 employees in eastern Cincinnati area (Amelia)

4. American Modern Insurance Company Background The organization believes that the strategic deployment of technology can help it achieve, and sustain, a competitive advantage. As stated in its Operating Principles, “Our investment in information technology is part of a carefully planned strategy to ensure that American Modern's company-wide infrastructure is among the most advanced in the specialty insurance industry.”

5. American Modern Insurance Initiative Background In 2000, American Modern embarked upon long-range initiative, coined “modernLINK,” Business and IT collaboration Business case and funding Three prongs: Web-enable insurance transaction processing Replace aging legacy processing systems Develop a Knowledge Management architecture

6. American Modern Insurance Business Case The anticipated returns of this business case were: 20% annual increases in directly-attributed new business 37% of Policy and Partner Administration moved from existing internal units directly to point of service 25% improvement in current Product Review and Management cycle time 21% improvement in Product Filings cycle time 2% reduction in total loss ratio directly attributed to modernLINK initiative

7. American Modern Insurance Business Case These returns would yield a significant recurring annual benefit through additional premium, increased profit, and decreased expenses Almost 50% of these benefits would be attained through better knowledge/data management, richer data segmentation, and improved data and risk selection John Hayden, President and CEO, American Modern states: We must have accurate data about the risks we insure today if we are to ever be successful in establishing The Right Rate for Every Risk we choose to insure in the future.

8. American Modern Insurance Knowledge Management Roadmap Enterprise Data Model Operational Data Store Enterprise Data Warehouse Themed analytic data marts Enterprise reporting portal Metadata management Data Stewardship

10. American Modern Insurance Knowledge Management Results Business users can: Make informed decisions Respond quickly to new business initiatives Create new opportunities Business users are: Moving from data collectors to data consumers Asking “why” instead of “what”

11. American Modern Insurance Knowledge Management Results Retention – Joe David. In the last four years, we have leveraged the corporate reporting tools to develop a series of targeted strategies that have allowed us to improve retention by nearly eight points, which equates to annualized premium of nearly $60 million Claims. Integration of 3 rd party Claim data - Heather Bolyard. This one-month sample of data for one material has identified a potential indemnity reduction of $70,000. Reserving – Gene Stetler. The new Loss Reserving data store from the Enterprise Data Warehouse has enabled process efficiencies, thus allowing us to predict our reserving needs with accuracy. Product – Kevin Randall. The implementation of American Modern's data warehouse has been a significant part of the successful launch of the company's right rate for every risk initiative

12. American Modern Insurance 2007 Awards and Recognition In 2007, American Modern received two awards from Computerworld: Laureate - The laureate status for the Enterprise Data Warehouse presented at the Carnegie Mellon Auditorium in Washington D.C – June 2007 BI Award - Best Practices in Business Intelligence in the category “Creating an Agile BI Infrastructure” presented in Las Vegas, NV – September 2007

13. Showcase Agenda Background/Business Case 20 minutes Sandy Wagner Data Warehouse – AIIM 20 minutes Latha Subramanian Data Model – AIIM 20 minutes Duke Ganote Information Management – AIIM 20 minutes Dan Daly Q& A – Duke/Sandy/Latha/Dan 20 minutes

14. Enterprise Data Warehouse Create an implementation roadmap Content scope – January 1998 thru present All products loaded over 5 years Implement “value” after each iteration Loss Cost, Retention, Loss Triangles Establish Data Stewardship - 2004

15. Enterprise Data Warehouse The data warehouse will support: Loss Cost Analysis Retention Analysis modernLINK Reporting Profitability Analysis Data Warehouse Underwriting Analysis Product Pricing Analysis Financial Analysis

16. Data Warehouse Value MH Loss Cost SB Loss Cost MC Loss Cost Retention UVRC Pricing / GLM Loss Triangles modernLINK MH PIF mLINK vs. Legacy Retro Studies Mapping Renewal Reporting FID MSB CAT Analysis Cancellation Reporting Address Data Agency Profile Analysis Claims Liability Partner Experience Reporting

17. Data Warehouse Statistics 1997 policies used to seed warehouse: ~700,000 Total policies Jan 1998 thru Jun 2007 Total units Jan 1998 thru Jun 2007 Average Number of Coverages per policy: 5 Average number of policies in-force per month: 800,000 Average number of claims per month: 8,000

18. Data Warehouse Benefits Single version of the truth Data integrated at the lowest level High-end hardware platform Codes translated to “English” terms Resolve source system problems Data quality review and correction Integration of external information

19. Data Mart Themes modernLINK quote Exposure Retention Experience Loss Cost Claims Underwriting

20. Technology Enablers…. IBM RS6000 AIX processors EMC data storage Oracle DBMS COGNOS for reporting utilizing query, report, mapping and analytical tools Websphere Portal LDAP for single sign-on

21. Showcase Agenda Background/Business Case 20 minutes Sandy Wagner Data Warehouse – AIIM 20 minutes Latha Subramanian Data Model – AIIM 20 minutes Duke Ganote Information Management – AIIM 20 minutes Dan Daly Q& A – Duke/Sandy/Latha/Dan 20 minutes

22. Data Model Provides a common, integrated way for the corporation to view and to communicate about its business Allows the business to drive the system Creates standard definitions/documentation Provides structure to new development projects

23. Enterprise Data Model Quotes/Policies Claims Coverages Accidents/Violations Homes/Vehicles UW rules Makes/Models Geography Address Insureds Operators Lienholders Claimants Things Places People

24. Jump Start Enterprise Data Model Acord Standards Generic Model based on Insurance Industry Practices Transform AMIG Specific Requirements Integrated View: Common Data Definitions Across business Manufactured Home Site Built Motorcycle Motor Home Travel Trailer Classic Auto FID Commercial AMIG Enterprise Data Model

25. Data Model Benefits Foundation for: modernLINK rate & quote applications Data warehouse/data mart/analytic design mLP3 Operational Data Store (ODS) design New projects simply add to the model Insurance score Claims liability Development of data standards and a common “language”

26. Inmon, Initially Data warehouse built using Inmon approach: Source (non- relational) Data Warehouse (normalized) DataMart (star) End of month End of month “ Corporate Information Factory Components”, W. H. Inmon http://www.inmoncif.com/view/26

27. Conformance Conformed Dimensions: Data Warehouse (normalized) Loss Cost DataMart (star) Conformed Dimensions Pricing DataMart (star) Retention Mart (star) “ The 38 Subsystems of ETL”, Ralph Kimball http://www.intelligententerprise.com/showArticle.jhtml?articleID=54200319

28. Challenges Multiple sources Latency Stewardship

29. Multiple Sources OPPORTUNITIES : Daily claims/catastrophe feeds 3rd party Claim data (claims cost standards) Huon (an new Insurance ERP) Munich RE (pending merger with reinsurer)

30. Multiple Sources RESPONSES : Pull data : generally from relational DBMS, e.g. DB2, Informix, SQL Server Push data : generally from non-relational DBMS: DMS II (Unisys)

31. Latency Changes OPPORTUNITY : Daily information Catastrophe reporting; e.g. Hurricane Katrina 2005, “Fab Four” of 2004 Financial Institutions requesting daily account information on insureds.

32. Latency Changes RESPONSE : Kimball architecture Source (OLTP) CATastrophe DataMart (star) Staging Area daily daily Daily Conformed Dimensions daily daily “ Kimball Design Tip #34: You Don’t Need an EDW”, Ralph Kimball http://www.kimballgroup.com/html/designtipsPDF/DesignTips2002/KimballDT34YouDontNeed.pdf

33. Latency Changes Kimball Architecture “ The staging area is exactly like the kitchen in a restaurant. The kitchen is a busy, even dangerous, place filled with sharp knives and hot liquids. The cooks are busy, focused on the task of preparing the food. It just isn't appropriate to allow diners into a professional kitchen or allow the cooks to be distracted with the very separate issues of the fine dining experience. ” Two Powerful Ideas: foundations for modern data warehousing, Ralph Kimball Sept 17, 2002: http://www.intelligententerprise.com/020917/515warehouse1_1.jhtml

34. Data Stewardship OPPORTUNITY : Daily instead of monthly reference data needed. However, for example, no daily system of record automated for: Claims Adjusters Catastrophe name/details

35. Data Stewardship RESPONSE : Data stewards maintain master data / system of record. Over night ETL uses master data for building dimension. Referential integrity always enforced with fact table, so data stewards cannot “delete” required for integrity.

36. Showcase Agenda Background/Business Case 20 minutes Sandy Wagner Data Warehouse – AIIM 20 minutes Latha Subramanian Data Model – AIIM 20 minutes Duke Ganote Information Management – AIIM 20 minutes Dan Daly Q& A – Duke/Sandy/Latha/Dan 20 minutes

37. Information Management Benefits Single BI Architecture Provides a consistent view of our Corporate Data Allows for common product training & support Volume license pricing provides flexibility and cost savings Converting Data Collectors to Information Consumers Corporate Portal Integration Delivering specific information to specific business users Providing pre-emptive alerts to users based on specific (data) events

38. Single BI Architecture (Consistent View, Common Training & Support & Volume Pricing) Using Cognos 8.2 for our Enterprise Reporting Portal Report Studio, Analysis Studio, Query Studio, Event Studio, Metric Studio All Cognos Content Provided in Themes modernLINK quote Exposure Retention Experience Loss Cost Claims Underwriting

39. Single BI Architecture (Consistent View, Common Training & Support & Volume Pricing)

40. Converting Data Collectors to Information Consumers Corporate Portal Integration

41. Converting Data Collectors to Information Consumers Delivering specific content to specific users ‘ Bursting’ Experience & Exposure information directly to our Business Partners (Agents)

42. Converting Data Collectors to Information Consumers Providing pre-emptive alerts to users based on specific (data) events

43. So What’s Next? Spend more time executing strategy & less time gathering data Manage to Corporate Scorecards / Performance Metrics

44. Showcase Agenda Background/Business Case 20 minutes Sandy Wagner Data Warehouse – AIIM 20 minutes Latha Subramanian Data Model – AIIM 20 minutes Duke Ganote Information Management – AIIM 20 minutes Dan Daly Q& A – Duke/Sandy/Latha/Dan 20 minutes

45. Q & A session

46. Wrap Up Enterprise Data Warehouse now in its 7 th year Business units embrace the DW Holistic view of information in one place Next phase: deliver similar functionality to our external business partners Our case study has been placed in National Archives The copy of the case study can be found on the following web page: http://www.cwhonors.org/viewCaseStudy.asp?NominationID=54

47. SWOC DAMA 2008 Showcase at American Modern Insurance February 21, 2008