Swiss Re Expands Global Life Insurance Operations
Client: Swiss Re
Challenge: Expand globally with an IT partner that has the longevity, experience and scale to achieve ambitious growth objectives
Solution: CSC’s business process outsourcing (BPO) services, providing both back-office resources and technology
Results: Completed more than 30 acquisitions of U.S. life insurance blocks, built a virtual company with 30 employees managing more than 3 million policies
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Top Reinsurer Manages 3 Million Policies with CSC’s BPO Services
With operations in more than 25 countries, Swiss Re makes risk-taking easier for hundreds of insurers and millions of businesses and consumers. Behind the scenes, Swiss Re gets support from a global IT and business solutions provider with deep industry experience. CSC has a 10-year, $700 million agreement for software and business process outsourcing (BPO) services to support Swiss Re’s global expansion and the management of critical risk data for its Admin Re® business unit in the U.S.
“CSC is a global partner with a significant resource base, and that’s important, providing flexibility and stability at the same time,” said Markus Schmid, Swiss Re’s global head of IT. “We frequently rely on CSC to take care of the technical development and everything related to the process, which frees us up to focus on business engineering and change management. And that creates value — not just for us, but also for our clients.”
Pioneering Admin Re
In 1995, John Deere, a leading manufacturer of agricultural and related equipment, sold its life and health insurance operation to Swiss Re. In connection with that transaction, Swiss Re partnered with CSC for the first time in an acquisition context. Under an agreement with CSC, Swiss Re transferred the responsibility for day-to-day administration of the policies to CSC’s BPO operations. Subject to Swiss Re’s overall management and oversight, CSC undertook all policy support tasks, including customer service, managing billing and accounting, and paying claims.
CSC immediately reopened the John Deere Life processing center in Jacksonville, Ill., and rehired most of the former employees. They became one of the key back-office alternatives for the Admin Re business. Since then, the two companies have worked together to support more than 30 acquisitions totaling more than 3 million policies.
Moving Large Blocks of Business
One of the most challenging Admin Re deals came in 2005 with the purchase of the life insurance operations of CNA Financial Services, including its subsidiary, Valley Forge Life Insurance Company. The purchase involved the complex transfer of 1 million policies consisting of a wide range of life and annuity insurance products.
The conversion to CSC’s CyberLife system was phased in over 18 months and six major conversion streams, during which the Admin Re team not only managed the day-to-day operations and more than 300 former CNA employees in Nashville, Tenn., but also led the migration and transformation of the business to CSC.
“We developed a plan with CSC to convert the IT systems as well as reengineer the administrative processes supporting the business,” Stewart recalled.
Building on a Solid Relationship
Over the years, CSC has assisted Swiss Re’s due diligence teams in assessing many acquisition opportunities. CSC also contributes to Swiss Re’s development of the pricing assumptions for migrating and managing the day-to-day operations of the acquired policies.
“With the expertise we have collectively developed over the years, our due diligence efforts are keenly focused on the key areas necessary to assist Swiss Re in the execution of a smooth and successful delivery of the Admin Re solution to our clients,” Stewart said. “We institutionalized a lot of our processes and methodologies and are best in class when it comes to evaluating migrating life and health insurance operations.” Stewart notes that while Global Admin Re is still a relatively young business in the U.S. and UK, it’s one of the highest-growth areas for Swiss Re’s worldwide life and health segment.
Ultimately, according to Stewart, the success of the relationship comes down to the talent and commitment of the people supporting it.
“We have good communication and processes around the handoffs between the two companies, and we also have really high-quality people who support the operation of this business,” Stewart said.