Towers Watson Releases Modeling Suite For Life, Annuities

MoSes U.S. Life Modeling Suite is meant to help life and annuities providers manage new regulatory requirements, such as Actuarial Guideline 43 and C3 Phase III, the company says.

New York-based Towers Watson has released MoSes U.S. Life Modeling Suite, software designed to help life insurance and annuities providers navigate regulatory changes.

Actuarial Guideline 43, which interprets the standards for the valuation of reserves for variable annuity and other contracts involving certain guaranteed benefits similar to those offered with variable annuities; and C3 Phase III, a proposed principle-based approach that would determine the interest rate and market risk component in the risk-based capital minimum capital requirement for life products in the U.S., both require principle-based approaches to risk management, Towers Watson notes. C3 is currently awaiting approval by the National Association of Insurance Commissioners. To implement these approaches, the new MoSes applications model variable annuity and universal life products with structural improvements with significantly lower run time and memory usage over prior applications, the company claims. These models calculate point-in-time and projected values on a statutory and GAAP basis using dynamic, on-the-fly calculation techniques, it adds.

The suite also supports nested stochastic structures with inner-loop asset/liability interactions, providing greater modeling accuracy than more simplified approaches where assets are not modeled. These applications use advanced software programming techniques to make optimal use of grid computing for faster results, according to Towers Watson.

“Demands on life insurers and annuity writers to measure risk more accurately are growing,” Todd Erkis, Towers Watson’s global life software product manager, says in a statement. “As a result, financial models viewed as highly sophisticated just a few years ago are now considered inadequate. Our new MoSes U.S. Life Modeling Suite applications represent a significant leap forward in actuarial modeling and software programming techniques to deliver results that were formerly considered unobtainable in practical terms.”

Nathan Golia is senior editor of Insurance & Technology. He joined the publication in 2010 as associate editor and covers all aspects of the nexus between insurance and information technology, including mobility, distribution, core systems, customer interaction, and risk ... View Full Bio