The challenge

Due to limited internal resources, a small European life insurance company pursued the outsourcing of quarterly economic scenarios. Working from a limited budget, the client required high-quality, timely service at a competitive cost. The ideal provider would generate scenarios and deliver them directly. Technical support, subject matter expertise, and custom configuration were also necessary to meet the business needs of this insurer.

The approach

Milliman Economic Scenario Generator (ESG) offered this client flexible capabilities with a cloud-native solution driven by the leading mathematical modeling of Milliman’s expert R&D team. The advanced ESG processes produced improved regulatory compliance for the insurer and ensured reliable scenarios were delivered promptly as needed.

Compliant with changing requirements

Milliman ESG undergoes continual development in order to comply with all requirements relative to modeling capabilities and regulatory guidance. This applies to both risk-neutral and real-world paradigms. Milliman’s fully transparent validation processes cover the full range of user and regulatory needs.

Advanced calibration methods

Critical to an efficient ESG process, Milliman focuses on ensuring robust and efficient calibration to deliver superior scenarios. Quarterly calibrations update the model to reflect economic shifts.

Custom calibration

While Milliman ESG also offers a one-size-fits-all solution, custom calibration was crucial for the business objectives of the client in this case. The specific application and economic context guide Milliman in recommending an optimal model whether or not custom tailoring is required.

The solution

Milliman began producing scenarios for this insurance company shortly after Milliman ESG was first offered. Since then, Milliman has demonstrated an industry-leading standard of regulatory compliance considering the deep scrutiny around ESGs. The Milliman ESG team has been rewarded for its significant efforts by the renewal of all clients. Today, Milliman continues to support requests from regulators and efficiently delivers custom calibrations at D+1.

Learn more about what Milliman ESG can do for you, here.