Risk Markets Technology Awards 2021: Use of cloud

Best use of cloud: Milliman

Pat Renzi, Milliman

In response to increasing demand from insurers for a comprehensive system covering all aspects of the actuarial value chain, Milliman re-engineered its MG‑ALFA actuarial software to create Integrate, a software-as-a-service solution fully engineered for the cloud that combines broad functionality, professional services and operational support. 

The single platform supports not only actuarial calculations but also front-end data management consistent with the calculations, as well as governed and controlled end-to-end processing of complex workflows, scalable and low-risk computing, and fast and easy-to-use back-end reporting and data visualisation.

Integrate operates on Microsoft’s Azure cloud. The scale of the computational demand from clients requires Integrate to schedule jobs across the globe. This multiregion approach guarantees the solution can meet regulatory timelines in light of regional availability issues, as seen earlier this year with Covid-19. In response to the exceptional demands on Azure as a result of responses to the Covid-19 pandemic, Milliman made improvements to Integrate that optimise which regions it uses. It distributes to regions with spare capacity and ensures clients are able to run all models without capacity issues, into many million hours in the cloud. 

Milliman can now dynamically allocate virtual machines (VMs) matched to model requirements, so models requiring large amounts of memory can run on larger VMs, reducing cost and runtime. It is able to provide this elasticity without increasing waste, something that required significant engineering. As a result, a typical customer consumption of around 1,800 core years per quarter produces only 432 core years of overhead. In addition, Integrate is able to leverage the overhead for other purposes. For example, during the pandemic it has donated ‘waste’ core years towards Covid-19 research via the Folding@home distributed computing project. 

A recent case study illustrates the capabilities and benefits of Integrate. A large, publicly traded insurance company needed to evaluate myriad risk scenarios to understand the impact of Covid-19, the volatile economy and significant internal restructuring. Time was of the essence, but the scale of the analysis was significantly more complex than the company had ever previously run – requiring the evaluation of 7.2 million different risk scenarios. Integrate’s elastic scale made it feasible to run every possible combination of the risks being evaluated, the equivalent of 214 years of computations, in just three days. In addition, the inherent resiliency of the platform enabled the processing to be completed with zero failures. 

Judges said:

• “Milliman demonstrates optimal and massive use of cloud for actuarial calculations.”
• “With its cloud-first strategy, Milliman exploits the power of public cloud and the scale it provides.”
• “A clear demonstration of the use of cloud technology to achieve scaling, flexibility, agility and resilience.”

Pat Renzi, principal, life technology solutions, Milliman, says:

“Integrate represents a paradigm shift in the delivery of actuarial software, technology and solutions. Balancing flexibility with control, Integrate’s single-platform approach enables actuaries to focus on what they do best – lead, with confidence. In the first three months of 2020, Integrate processed over 25 million hours running actuarial analyses in the cloud. The key advantage is that customers deliver faster, more reliable results through Integrate’s ability to provide exceptional scalability for calculations and data analytics powered by Microsoft Azure, Solvency II standard formula and internal model risk distribution calculations, and automated and controlled end-to-end workflow for production cycles, with tailored professional services and cloud operations support from Milliman.”

 

Read more articles from the Risk Markets Technology Awards 2021 winners’ review

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