 ACORD A Framework For SOA Lloyd A Chumbley ACORD

SLIDE 2 Who is ACORD?  Independent and Objective Trade Association  Serving the Industry since 1970  Facilitating Industry-Driven Standards for Agents, Carriers, Solution Providers, Associations  Not For-Profit Corporation  Anti-Trust protected forum for developing Standards and promoting implementation  Offices in NY & London  60+ Staff many from the Insurance Industry  Develops, Manages, and Promotes Standards… ACORD is a 30 Year Old Organization Focused on the Business of Insurance.

SLIDE 3 ACORD: Role in Standards  To foster cooperation among insurance companies, agents, brokers, solution providers and other associations.  To provide legal framework for competitors to work together on common goals within antitrust guidelines.  To promote solution-provider involvement to develop technologies enabling current and future implementation.  To manage the standards process. ACORD Does Not Develop Standards; Rather We Provide a Neutral Environment for Participants to Engage.

SLIDE 4 ACORD: Guiding Principles  Remain Driven By Industry Needs and Requirements.  Develop and Promote Open Standards.  Create Cooperative Relationships With Other National and International Standards Organizations.  Provide Advocacy and Education on Standards.  Utilize and Promote Cross-industry Standards.  Remain Technology and Vendor Neutral. We Also Provide Value by Working with Organizations Like OMG to Promote Technologies.

SLIDE ’s Forms 1980’s AL3 1990’s AL3 Implementation Industry Framework 2003 Global Standards, Reinsurance 1998 XML 1996 Life Standards Evolution Of …

SLIDE 6 Standards Programs Today  Property & Casualty  Personal Lines  Commercial Lines  Surety  Global  Reinsurance / Large Commercial  P&C Reinsurance  Large Commercial Lines  Global  Life / Annuity  Life  Annuities  Health  Group Lines  Reinsurance  Global Data Model XML Forms Data Model EDI XML Forms Data Model EDI XML Forms Cross Program Standards DRI Standard (Document Repository Interoperability) SOAP Framework Enterprise Models Business Processes / Common Model & Dictionary

 ACORD ACORD History The History of ACORD is One of Solving Communication in the Insurance Industry Thru Messaging.

SLIDE 8 ACORD Property & Casualty / Surety Standards  Forms in 1970  Communication from Agents to Carriers  Today More than 583 Forms for the Industry  Data Exchange  Began in the 80’s with Traditional EDI  340 Messages  Expanded to XML in the 90’s  Messages Today  15+ Lines of Business  Guiding the Industry  Implementation Guides which define Process and Associated Data ACORD Messaging Began with Property & Casualty And has Focused on Messaging.

SLIDE 9 ACORD Life & Annuity Standards  Microsoft Founded Organization in Early 90’s  Communication between Desktop Applications  OLE / COM / DCOM / JAVA for Life Insurance  Data Exchange  Begin to Grow with Move to ACORD & More Importantly a Move to XML  100+ Coarsely Grained Messages  Life, Annuity, Disability, Long Term Care +  Industry Implementation  Implementation Guides  External Associations (e.g. NAVA, CLIEDIS, NAILBA)  Process and Associated Data  Industry Model of Data (not a Data Model)  Internal & External Integration The Life Standard at ACORD has Moved Beyond Messaging to Data & Process Long Before SOA.

SLIDE 10 ACORD Reinsurance / Large Commercial  Standard Built On An Implementation  Exchange Hub Needed Definition in Europe  Defined Standard for the Hub  Transitioned Standards Only to ACORD in 2001  Data Exchange  6+ Coarsely Grained Messages  Focused on Actual Plug & Play  Testing & Certification  Industry Usage  Implementation Guides for Key Processes  Implementation Focused on High Profile Industry Initiatives  Contract Certainty The RLC Standard has Focused on Key Issues for the Industry and Using Messaging to Meet these Needs.

SLIDE 11 So What Does ACORD Have But Not Defined? Cross Domain Process Standards Inventory of ACORD Process Service Definitions Supported by a Common Data Architecture comprised of: UnderwritingClaimsChannel ManagementProduct Portfolio Mgmt Provides the Business Context or a list of standard business processes Provides the Business Services performed and process inputs and outputs Business Term Dictionary Contextual Data Model = Listing and definition Of things that are important to the business. User = Business Strategy Conceptual Data Model A Semantic Model = Entity = Business Entity Relationship = Business Relationship. User = Business Owner Logical Data Model A System Data Model = Entity = Data Entity Relationship = Data Relationship. User = System Designer Technology Layer supported by XML Messaging and Forms Standards Life & Annuity XML/EDI/Forms Life & Annuity XML/EDI/Forms P&C/Surety XML/EDI/Forms P&C/Surety XML/EDI/Forms RLC XML/Forms RLC XML/Forms By separating the technology layer, investments in standards stand the test of time as you swap out the technology but not the standard

 ACORD ACORD Comes to SOA Over the Past Year, ACORD has Realized that We Have the Materials, We Just Need to ReFormat for the Industry.

SLIDE 13 Bridging the Gap… Business Conceptual Model Capability / Process Models Messaging Models Messaging Implementation RLC LAH AML AWSP / DRI PCS Data Models

SLIDE 14 Justifying the Existence  Framework will Save Time  Creation of content in a structured environments means you don’t start from scratch  Coloring a Picture vs. Drawing a Picture  Framework will Reduce Risks  Projects fail but when built on a Framework, you are not forging new ground  Incorporates best thinking & best practices  Framework will enable Business Agility  Framework provides business context and allows companies to differentiate on unique needs  Framework will Reduce Costs  Conceptualization of entire environment allows for easy identification of areas for replacement as needed  Framework will enable Incremental Development  Conceptualization also allows easier identification of reuse Any Framework would have a dramatic impact on the bottom line of many participants in the business of insurance.

SLIDE 15 Why An Industry Framework Instead of Existing Frameworks?  Proprietary Frameworks  Gives a single companies interpretation of the insurance industry  The interpretation would need to be harmonized with other companies frameworks since their frameworks might differ.  Standard Industry Framework  Provides an industry consensus on the business.  The advantages that would be accomplished inside an enterprise would be expanded to all interactions of the industry.  Demonstrate How the Messages Support Web Services Today and Will Position for SOA in the Future A proprietary framework could be used by any individual company but there is a need for a Standard Industry Framework

SLIDE 16 Introducing John Kellington, Senior Vice President John Kellington, Senior Vice President of Standards discusses ACORD Standards Framework, it’s value, and why ACORD is uniquely positioned to deliver it to the industry. Click Here to Play Video

SLIDE 17 Pillar #1 – The Data Party Product Agreement Location Rating Underwriting Print Product Definition Security Physical Object Glossary & Data Structures  Users can clarify and reconcile terms more easily by having a common language.  Other geographies can cross reference with their own terminology and identify unique local needs.  Vendors can build solutions with a common structure so that it will ease integration and STP.  Business Analysts and Data Modelers have a single place where they can reference a term and its relationship to other data. The Glossary and Data Structures will be used to increase data, consistency, transparency and accuracy.

SLIDE 18 Pillar #2 – The Processes Process Party Product Agreement Location Notepad Worklist  Software purchases or outsourcing agreements are simplified by ease of identification of the process involved.  Agencies will find more consistency across companies where they do business.  Senior management and business users will have a library of sample processes for all aspects of the business that have been vetted by the industry. The Business Capabilities and the Process Definitions act upon the Glossary and Model improving assessment, consistency and accuracy of planning for the integration of information.

SLIDE 19 Pillar #3 – The Messages Process Party Product Agreement Location Notepad Worklist Messaging  Business analysts will provide more specificity on the role of messages in integration thus providing more logically organized into the context of the message.  Data available for a message will be more expansive providing more opportunity for innovation and uniqueness while still using standards.  Integrators will already know the data and the process definitions when they go to reuse a message for integration. The Business Messaging Library utilize components for a specific process thus uniquely positioning messages for business integration, web services and ultimately, SOA.

 ACORD SOA Activities At ACORD ACORD is Currently in a “Proof of Concept” on How to Migrate from Messaging to SOA.

SLIDE 21 High Level Framework – UML 2.0

SLIDE 22 Pillar #1 – The Conceptual Data Model ACORD has Begun to Re-Organize Existing Data Into These New Structures that Define the Business of Insurance.  Len Silverston’s Data Model Resource Book & “Universal Models”  Common, Reusable Data Structures  Facilitates Common Understanding of the Data  Proven Models for Production Systems  60% of Common Constructs Apply  Saves Time and Increases Quality  Conceptual Data Model  Defines the High Level Entities  Defines Business Associations  Defines the Elements to Understand the Relationships of Entities  Uses UML 2.0  Not a Data Logical or Physical Data Model, Rather an Understanding of the Data

SLIDE 23 Pillar #2 – The Business Process Definitions ACORD Already Has Process Definitions but Need to Deliver Them in Format Other Than Word and PowerPoint.  Creation of Repository of Business Activities  Exist today in ACORD Implementation Guides  Need to Formalize the Repository & Usage  Usage By Companies  Need to Understand Roll of Business Process Modeling Notation in Companies  Can ACORD Provide Definitions for Activities to be Used by Modelers in Insurance Companies  Need to Enhance Association Usage of ACORD Standards  Must Solve the Problem of Industry Process Definition by PowerPoints

SLIDE 24 Pillar #3 – The Messaging Structure ACORD’s Consolidation for the Messaging Libraries is an Effort Already Underway. We are Engaging that Effort to Support SOA.  ACORD Messaging Library  Activity Underway At ACORD  Define a Single Message Library for the Industry  Challenges  Granularity  Modeling  Migrate to a Usage of UML 2.0  Need to Take Existing Models and Connect Them Into the Right Models for Proper Traceability  Provide the Actual Data Elements  Data is Specific Messages  Define the Definitions and Rules

SLIDE 25 So What About…. If You Have Followed the ACORD Framework, You Have Heard a Lot of Terms. Here are Some Thoughts on The History.  The Dictionary?  Not a Separate Deliverable  Aggregated from the Models in the Framework  Simply Format the Data in the Various Areas  Forms?  Simply a Very Specific Type of Message Model  Core Components?  UNCEFACT Effort to Unify Business Definitions  Again, Not a Separate Deliverable  Aggregated from the Models in the Framework  Capability Models?  Part of the Process Service Definitions  Just the Highest Level  Data Models?  That is the Question, Isn’t It?

SLIDE 26 It is a Journey, Not a Destination How We Get There is by Prioritizing Areas of Interest and then Building the Models for those Subject Areas First.  ACORD Cannot Tackle Deliverables Sequentially  Having a Conceptual Data Model Does Not Create SOA  Need Entire Breadth to Implement  Prioritize the Subject Areas  We Need to Build the Components By Process, Not By Models  Attack Those With Interested Parties First  Support Our Members  Partnerships  Some Associations are Heavily Implementing  Support Them In Current Efforts, Not Work Against Them  Service Discovery  ACORD is Evaluating Establishing Registry Around ACORD Service Descriptions

 ACORD World Headquarters: Two Blue Hill Plaza 3 rd Floor Pearl River, NY USA London office: LUC - Suite 2/5 3 Minster Court Mincing Lane London EC3R 7DD UK +44 (0) SLIDE 27  ACORD 2006.