HSBC Insurance in the UK has signed a deal with IBM for analytics software aimed at preparing for the upcoming European Solvency II legislation.
The legislation aims to strengthen protection for insurance policy holders.
IBM said it will assist HSBC in developing and implementing a business analytics platform that "will provide advanced insight and analysis of the company's risk management data" so that "capital can be efficiently allocated to cover business risks". The system will be based on IBM Cognos 8 business intelligence software.
Insurance firms have to implement Solvency II by 31 December 2012. The objective of Solvency II is to ensure that insurers fully understand the risks inherent in their business and allocate sufficient capital to cover those risks.
Providers may agree with their regulator to use a standard formula or create their own full or partial internal model to satisfy the new capital adequacy requirements.
The IBM platform at HSBC will provide a store for HSBC's risk and solvency modelling data, and will permit HSBC to "demonstrate quality, availability and traceability of all key regulatory data and associated reporting".
The software will enable users to view modelled results data, adapt and enrich reports to meet their needs and distribute them as required.
Stephen Coombes, chief finance officer at HSBC Insurance UK, said: "Preparation for Solvency II is critical for our business and demands specialist expertise, we are pleased to be working with IBM on this vital activity."
Earlier this month, HSBC Bank promised clients simpler transaction connectivity following an agreement with SAP, based around an open connectivity standard. HSBC, SWIFT and SAP are jointly creating the next generation of HSBC Connect to SAP, the bank's corporate-to-bank integration and treasury offering for firms running SAP enterprise resource planning systems.
This story, "HSBC Insurance covers itself with new business intelligence system" was originally published by Computerworld UK.