Operational scale enables insurance companies to efficiently increase the assets under management in both their general and separately managed accounts while providing flexibility to pursue broader investment activities that may offer improved portfolio diversification and additional yield. A modern investment operations and accounting platform can help insurers achieve greater operational scale, flexibility, transparency and insight into critical investment activities. To be truly effective at providing operational scale, the platform should also offer a high degree of seamless interoperability with a variety of upstream and downstream systems to automatically capture, validate and enrich data at various stages throughout the investment lifecycle.
As market conditions and investment activities among insurers have changed significantly in recent years, many insurance investment teams are reevaluating their readiness to scale and considering whether to upgrade systems and/or add specific expertise to reduce operational risk and improve operating margins. But how do you determine whether a platform has everything you need? We have identified a few key indicators:
- Can the system process data from multiple sources and formats while making real-time insights available to your staff?
Having the ability to readily and seamlessly interface with multiple managers, trading systems, custodians, pricing vendors, rating agencies, data warehouses, corporate ledger and regulatory filing systems will ensure your investment teams can stay nimble and agile—all while maintaining a standardized operating model designed to scale efficiently. Carefully choosing a technology platform and partner that offers a larger ecosystem of pre-built interfaces can ensure you are positioned for success.
- Can the system easily incorporate asset types that are more complex?
If insurers are currently managing assets outside of their core investment accounting system through spreadsheets or other workarounds, the right platform and operating model should be able to accommodate these assets as well. This will allow for improved data controls, increased scalability, a more holistic portfolio view, and ultimately a more efficient accounting close process since the complex investments no longer require additional time and resources relating to manual, offline processing.
- Are your trades, security master attributes, market data and securities events captured, processed and updated on a real-time, automated basis?
Choosing a platform that offers direct integration with multiple market data and ratings agency vendors will provide you with the flexibility to align pricing and valuation policies and hierarchies with both existing and new asset managers and custodians while ensuring you have a consistent, comprehensive, and accurate investment and accounting book of record for downstream financial and regulatory reporting purposes.
- Is your exceptions monitoring reliable?
Having a system that offers real-time transparency and controls into the status of exceptions—such as trade, cash and position breaks, missing or stale prices, ratings, factors or security master attributes—will help ensure your operational staff or outsourced servicing teams can stay abreast of data and processing exceptions daily and take appropriate steps to remediate them well ahead of your month-end or quarter-end accounting close. This can help eliminate unnecessary last-minute fire drills, or the need to reopen prior accounting periods, which could potentially trigger an unwanted audit.
Underlying all of these considerations is the need for transparency. Rather than simply receiving a series of reports at the end of the month or quarter, a platform that offers an integrated infrastructure will allow you to see where things stand at any point, demystifying the process and enabling you to have more accurate and timely data throughout the month.
Attempting to maintain all of these processes in-house can be difficult given high operating costs, including personnel needs and continued infrastructure investment necessary to operate most efficiently. Choosing a solution like SS&C’s flagship insurance investment accounting and operations platform, Singularity, can enable you to benefit from a flexible, interoperable operating model with a scalable global infrastructure at your fingertips.
Singularity brings maximum scale and efficiency to today’s insurance investment operations, using automation to capture, process and update trades, security master attributes, market data and securities events in real-time. Our service team streamlines daily reconciliation activities between all parties and the Singularity investment accounting system and provides operational monitors to track and identify any data exceptions or anomalies so they can be addressed and remedied promptly. Through our outsourcing services, insurance companies can ensure best practices in all areas—from investment accounting operations and processing of complex assets to risk and performance management and regulatory controls and reporting.
To learn more about Singularity, how it can help you maintain transparency and data integrity as you grow and its many other best-in-class features, watch our "Best Practices for Insurance Investment" videos.
