Milliman USA Acquires Actuarial Software Practice From IBM

"This is an important strategic step for our organization, underscoring our commitment to leadership in both and life insurance and property and casualty sectors," states Bradley M. Smith, chairman of Milliman USA. "In the life arena, the ability to offer clients the suite of Triton products in tandem with Millimans MG-ALPHA pricing and projection system reinforces our leadership positionFor p-c clients, IAS practices loss-reserving softwaredirectly complements one of the most important areas of our consulting services to the p-c market."

According to Milliman, the Triton products are used primarily for "valuation of liabilities on a statutory, tax, and U.S. GAAP basis." The suite includes: Triton Interest-Sensitive Life, Triton Traditional Life, Triton Deferred Annuity, Triton Payout Annuity, and the recently released Triton Health.

"We will have a substantial market position immediately, and there will be ample opportunities to combine the products going forward," notes Perrott. "We will be able to offer a single suite of products that covers virtually the entire spectrum of client needs by having common data and calculations across product development, valuation, business planning and projections."

Andy Johnson, casualty national director for Milliman in Boston, confirms that the acquisition involved no layoffs or duplication of services. "Were investing in it as a business," says Johnson of IAS p-c products. "We like the products and we like the people. This gives us some systems and product development capabilities we didnt have before."

Milliman says two of IAS loss-reserving systems–Affinity and ReservePro–are targeted for the p-c insurance and self-insurance markets. The products, which include both desktop and enterprise systems, provide "flexible, comprehensive platforms that can support a high-performing actuarial or reserving department."

"This complements what we do, because the software they have deals with analysis of loss revenues, and thats a big subset of the consulting services we provide to insurers, self-insurers and captives," states Johnson.

According to Lia Papa, a media relations representative for IBM Business Consulting Services, IBM viewed the IAS products as a "niche" focus. "If we do provide these services, its very rare," she explains. "Were focusing more on strategic change and technology integration."

Johnson says the 10 p-c IAS employees and the 16 life product employees all remain "pretty close to where they were working before."

Asked if the acquisition had presented any challenges, Perrott notes: "Its gone pretty smoothly. There was the typical hassle of a move but nothing that got anyone excited."

Reproduced from National Underwriter Life & Health/Financial Services Edition, May 26, 2003. Copyright 2003 by The National Underwriter Company in the serial publication. All rights reserved. Copyright in this article as an independent work may be held by the author.