1. IASA CIO Roundtable 30 Years in the Insurance Industry William C. Stone, Founder & CEO SS&C Technologies

2. 2 30 Years of Change Overview Consolidation & Globalization: From Mainframes to the Cloud Outsourcing Regulation, Capital Standards and De-risking Inflation to Disinflation to Deflation Big Data, Big Models, Big Output Direct Marketing Goes Mainstream Accounting Alternative Risk Transfer and New Players Variable Products: The Rise and Fall, and Rise Again Aging of the Population

3. 3 Consolidation & Globalization Economies of Scale Role of Technology Now: The Cloud Variable Cost Model Scale for every user

4. 4 Inflation to Disinflation to Deflation 1980s: Inflation Turned to Disinflation Today’s Concern: Deflation Profit Pressure Search for Yield

5. 5 Outsourcing 30 Years Ago: Everything Done In-house Investment Outsourcing Complex Investments Operational Challenges Model Risk Increases with Complexity Tendency to Understate Risk Role of Technology Manage complexity Improve decision- making

6. 6 Regulation, Capital Standards, De-Risking  Regulatory Expansion  Capital Requirements ‒ Standardizing Effect ‒ Investment Strategies  De-Risking ‒ Impact on Liquidity ‒ Too Big to Fail

7. 7 Big Data, Big Models, Big Output  Technology enables Big Data  Model Complexity  Regulatory Needs, e.g., Solvency II, ORSA  Rating Agency Demands

8. 8 Direct Marketing Goes Mainstream 1980s: Direct Marketing Was Niche Now Mainstream ‒ Technology ‒ Internet, mobility ‒ More Changes Coming, e.g., Self-Driving Cars

9. 9 Accounting  More Complex  Driving the Business Toward a Short-Term View –Market Consistent/Mark-to-Market –Insurance is a Long-Term Business  Governance/ERM Geared Toward Accounting Controls

10. 10 Alternative Risk Transfer and New Players  Capital is More Fluid Today  Opportunities are Seized More Quickly  Traditional Insurers Now Compete With: –Alternative Risk Transfer Groups –Hedge Funds/Private Equity

11. 11 Variable Products: Rise and Fall, Rise Again Original Idea: Shift the Risk to Policyholders Guarantees Shifted the Risk Back to Companies Huge Losses When Markets Crashed Variable is Back With New Designs: Living Benefits

12. 12 Aging of the Population  Mature Population ~ Mature Insurance Industry  Declining Birthrates  Increased Life Expectancy  Population Growth Will Depend on Immigration  Longevity Needs for Income, Long-Term Care

13. Questions?