0 Actuarial Software VIPitech SEB Estonia Experience Piret Raukas Jaanus Sibul

1 Idea of presentation To give short overview how the software works and looks like Share SEB Estonia’s experience of using this software Strenghts and weaknesses of VIPitech from our viewpoint Not to advertise this specific software

2 What is VIPitech? Software for actuarial and financial analysis Product of consulting firm Watson Wyatt Worldwide Launched in April 2006 Designed specifically to: -make actuarial models easier to use -simlify building complex models -optimise run speed for stochastic modelling

3 VIPitech can be used for: Embedded values Product pricing Financial reporting Stochastic calculations Asset liability modelling Financial projections Business planning …

4 VIPitech in SEB Estonia SEB Estonia have used the software from the start of the 2008 In 2007 october SEB had intensive 1 week VIPitech trial period together with training from Watson Wyatt team SEB Estonia didn’t consider other actuarial softwares because SEB Sweden already used previous version of VIP software

5 VIPitech in SEB Estonia SEB Estonia uses at the moment only very small part of VIPitech functionality SEB Estonia has implemented embedded value calculations for unit-linked products Implementation was joint project for all SEB life companies. Watson Wyatt team led and consulted the project Implementation lasted 4 months SEB Estonia invested time of approximately 1.5 people to implementation during these 4 months

6 Our experience – strengths of VIPitech Very broad functionality, although we use only small part of it at the moment. Good structure of the software. Easy access to different parts of models. User friendly interface. Good architecture of models. Model is built from different parts which can be reused in other models. In VIPitech very complex modelling can be done. For example SEB Denmark traditional products, which profit sharing part is very complicated due to local regulations.

7 Our experience – strengths of VIPitech Very well integrated with Excel which allows easily send results to Excel and comfortably make reports in Excel using VIPitech add-in. Easy use of different assumption sets with external assumption files (Excel). It allows easily to store assumtions used together with report of results in Excel. Running speed is very good. SEB Estonia previous model of unit linked embbeded value run lasted hours, VIPitech run lasts minutes. We haven’t tried speed of stochastic models!

8 Our experience – strengths of VIPitech Special tool, “Analyzer”, is very good for checking values of calculations. VIPitech includes a lot of modules which can be used for modelling. You don’t have to programm everything from scratch. Watson Wyatt regularly adds new blocks there and it includes even complete common products for bigger markets. This library is called Standard Code.

9 Our experience – weaknesses of VIPitech With high functionality comes high complexity of program. Very hard to start to use, needs a lot of training. Lot of time should be invested before getting familiar with software. First models and more complex models need use of consultants from Watson Wyatt. Consultation from Watson Wyatt is not cheap. Watson Wyatt is the only alternative to get consultation about VIPitech modelling.

10 Our experience – weaknesses of VIPitech Standard Code doesn’t include common products for smaller markets. Manual and help files are undeveloped and very laconic

11 Thank you!