For the Challenge de Diciembre 2014 – Enero 2015 , Decision Management Community web proposes participate in the “UServ Product Derby”. Over 10 years ago BR vendors had a chance to demonstrate their product capabilities at Business Rules Forums, using the same use case known as “UServ Product Derby”. The majority of BR vendors openly competed during these major BR events and potential users had an opportunity to compare different solutions.
The business case deal with vehicle insurance problems including eligibility, pricing and cancellation policies for a hypothetical insurance company. In this link we have a document with a more detailed description of the business case with a model of business entities and the test scenarios which we have to solve.
To deal with this solution we will use the BRMS IBM Operational Decision Manager 8.7.0. This new version of the product, let us simulate the impact of changing decisions for the client portfolio.
Below we detail our solution to the business case.
Our solution receives a proposal for Policy trading. From these data will go running rules, calculating premiums for both cars as drivers containing the policy and in the final step estimate the annual policy premium.
The flow of execution of rules or workflow is as follows:
Business Console Decision Center is the platform used by business users and / or analysts to manage the rules repository.
As shown below rules that form the Service Decision are written in natural language, enabling users of the platform to keep these rules without depending on IT department. This provides greater flexibility in making decisions because we separate application logic from business logic.
The solution we have defined for the business case consists of 65 rules. Let’s see in detail some of these rules:
Eligible Driver senior driver and training certification
In this rule, if the driver is Senior and has training certificate have it marked as eligible for the policy.
In this example we see a rule for the package “Pricing”. Where we will increasing or decreasing the premium based on conditions. On the right side, we can see the data and some properties of the rule. User who edited the rule, the state of the rule and date properties that we can use for the rule to be valid for a certain period of time.
Besides business rules have also decision tables. In this picture we can see a table we use for scoring. In the table we can define some preconditions that decide if the table is executed or not, then we need as many columns as columns conditions and action.
From the scenarios presented to us in the business case, complete the information in excel. These excel with a simulation run them within the Enterprise Console and we graphically show the results.
The business case proposes a series of scenarios to validate. When you run these scenarios, we have to provide some results to ensure that the solution was correct..
Some rules use the current year, for the implementation of the scenarios we will use 2015.
At the end of the article we show the implementation that we have order to reach solutions shown below.
Preferred Client Business Rule V1
For the implementation of the scenarios the tool provides excel sheets to enter data and the results we expect. We fill the information in excel with data from this scenario.
On the first tab we define the policy with drivers and cars.
On the next tab we define the policy drivers.
Result the execution of a simulation scenario. The client type is “Preferred Client”.
Preferred Client Business Rule V2
We generate excel with new data from this scenario.
Result the execution of a simulation scenarios. Although the data are almost identical to the previous client, the client type is not “Preferred Client”, price increases..
In this scenario only change data of the car, and tell us that vehicles have one more year. To do this change the year of the vehicle.
Result the execution of a simulation scenarios. In this scenario re-rated the first customer and still “Preferred Client”, the price varies because the vehicle is older one year more and is not within the range “between 5 and 10 years”.
Eligibility Within and Outside an Elite Client Relationship
Result the execution of a simulation scenarios. Shane’s client Type is “Elite Client” because she is within father’s portfolio. Therefore his “Eligibility Score” is 0
Result the execution of a simulation scenarios. Shane is out of the portfolio of his father and therefore his client type not is “EliteClient”. With his data his “Eligibility Score” is 100 and therefore the eligibility result is:
“the client’s application/policy renewal must be reviewed by underwriting manager who will determine whether the client is eligible for auto insurance“
We calculate the value of his annua lpremium considering that after review it has been considered eligible.
We take the Challenge to show simulations in the Enterprise Console, simulations are becoming available from version 8.7. With simulations, besides show the results we wish, from change of a rule we can observe the impact it has in our client portofolio. We will show the workflow for creating a simulation and a brief description one of each elements needed for simulation.
In this example, we show a graph where the variation of the annual premium is shown in the first 3 scenarios previously executed.
In this new Challenge we have seen as a BRMS can help insurance companies, convinced that this technology should be part of its Strategic Plan Systems because:
- Improve your “Time To Market” accelerating decisions in production environments.
- Critical services allows the sector to be legible and traceable improving the attention of customer complaints.
- Reduce dependence on IT department thus reducing maintenance costs.
- Centralized in a unique system Decision Services allowing these are centralized and reusable for different applications and technologies (On-Line, Batch).
- Simulates the impact of changing decisions on the portfolio.
We will detail the development, to show how we determine if the client is eligible for the policy and how we calculate the annual premium.