SAP Cloud for Insurance Partner

April, 2013
Driving Innovation in Insurance
with SAP Cloud

© 2014 SAP SE. All rights reserved. 2
Dynamics SAP Cloud Innovation Why SAP? Next Steps
For internal and SAP partner use only
Dynamics in the insurance industry
Procurement, Operations & IT
Cost & Complexity
Risk & Finance
Profit & Regulation
Sales & Service
Time to market
Human Resources
Workforce restructuring
• Underwriting new policies
• Lack of visibility into customer
base and lifecycle
• New non-traditional
competitors
• Pressure for greater ROI
• Establish compensation plans
with reduced scrutiny
• Attracting leading talent to
insurance industry
• Extended workforce
• Hindered succession planning
• Ongoing M&A activity
• Capital reserve requirements
• Regulatory rules & auditing
requirements
• Increased losses due to
insurance fraud
• Market volatility
• Complex, aging siloed systems
• Pressure on operational costs to
streamline processes
• Costly replacement-of-goods
processes
• Optimized billing and payments
Increased pressure on decision makers across the enterprise

Insurance is at an inflection point
Engage clients and drive
profits while maintaining
regulatory compliance
Cloud
Real-Time
Computing
B2B/B2C
Social
Big Data
Mobile
Personal
Computer
WWW
New Business
Models
Changing
Demographics
VolatilityGovernment
Regulations
Distributed
Computing
Internet
Self-Service
Multi-Channel
End-of-Life
Scalability
Limitations
Application
Silos,
Data Sprawl
Service-Level
Challenges
Technology
Debt
Technology
Value

Insurance and the cloud imperative
Source: SAP Performance Benchmarking,
Of financial services firms surveyed believe
that cloud computing will transform their
organization and/or industry
91%
Of financial services firms surveyed expect a
major impact on company performance
within five years
67%
Of financial services firms surveyed expect
cloud to amplify and accelerate other
technology megatrends (e.g., big data,
mobility, analytics)
70%
Note: Financial Services consists of Banking and Insurance

Cloud solutions deliver agility and innovation
Faster deployment
• Full deployment in weeks
• Mobile-grade user experience = less training
• Applications on the web – easy access for contractors
More frequent innovation updates
• Multiple innovation releases per year
• Customer feedback and changing market demands a
cornerstone of updates
• Cloud is always on the latest release
Agile deployment, configuration, and integration
• Rapid process configuration
• Faster adoption
• No lengthy upgrade cycles
• Pre-Packaged integration
Lower TCO & faster time to value
• Lower initial solution and deployment fees
• No maintenance or upgrade costs
• More standardization and best practices

Market Insight and Customer Intimacy: Serve clients
with tailored insurance products and services in real-
time, gain better market insights, react faster to market
demands and increase customer loyalty
Insurance Operations: develop targeted products
quickly and settle claims rapidly
Finance & Risk: Improve margins; close books faster
and predict and prevent claims fraud, reduce CAPEX
Human Resources: Empower employees to meet
business goals and recruit the best talent, better
engage external agents
Procurement: Reduce operating and supply change
costs, as well as optimize the replacement of goods
process
CIO: Reduce infrastructure costs, increase business
agility
The time is now: Transform insurance with cloud

BUSINESS NETWORK BUSINESS TO BUSINESS COLLABORATION
SOCIAL People-to-People Collaboration
PEOPLE CUSTOMER MONEY SUPPLIER
MARKETPLACE
PARTNER/
ISV APPS
CUSTOMER
APPS
SAP HANA CLOUD PLATFORM
APP DEV & INTEGRATION SERVICES | DATABASE SERVICES | INFRASTRUCTURE SERVICES | INTEGRATION
LINE-OF-BUSINESS CLOUD APPLICATIONS
SUITE ON
HANA
BW ON
HANA
MANAGED CLOUD
BUSINESS
SUITE
SAP cloud solutions power operations across the insurer
Drive sales,
service and
workforce
strategies
Optimize
sourcing
strategies and
operations and
3rd party
replacement of
goods
Innovate with
social collaboration
with insurance
ecosystem
(agent/brokers,
reinsurers etc.)
Listen to
markets, create
promoters and
and equip sales
with 21st
century tools
Gain a real time
and holistic
view of finance
and risk
Commercially
collaborate with
your supply chain
Manage your
entire insurance
business powered
by our real-time
platform – without
hardware
investment
Build, run and
integrate
innovative
business Apps on
the world´s leading
in-memory cloud
infrastructure
From the front to the back office enabled in the Cloud
Extend and
scale
innovation

Challenges in insurance
With customer interactions for sales and marketing head
Poorly executed sales strategy
Monetizing the call center
End-to-end sales force automation
Support for omnichannel customer interaction
Effectively managing the multiple partner channels
Timely management of billing and real-time revenue
reporting
Lack of holistic view of marketing cycle
Percentage of financial
institutions that have a
unified 360° view of the
customer and are able to
provide a consistent
experience
Greater ability to use Big
Data with a well-defined
analytics strategy
27%
Higher percentage of field
sales achieving quota
where sales pipeline is
optimized
17%
68%
Source: SAP Performance Benchmarking

SAP 360 Customer solution
Delivering better marketing, sales, & service
Engage with and retain your
customers while converting
loyalty into revenue and
profitability
• Delivering insights across all
channels (incl. agents/brokers)
• Engage customer like never before
and get them to promote you with
easy-to-understand, enterprise-
wide, social customer insights
• Make fact-based decisions
Attract customers while driving
profitability & growth
• True customer 360 insights with
embedded predictive analytics
• 1.1 customer engagement
• Meet customer needs and
expectations
• Better listen to and engage with
your customers
Market
Better
Sell
Better
Exceed customer expectations
and drive customer loyalty
anytime, anywhere and on any
device
• Solve issues proactively
• Streamline application, claims and
service operations
• Deliver a cohesive customer
experience across all channels incl.
social media
Service
Better

With ISO circulars in insurance core operations
Bring complex products to market quickly
High cost of premium leakage
ISO releases hundreds of changes each year,
described in thousands of circulars across
all lines of business
Many property and casualty carriers use ISO
as a resource to help them stay current with
loss cost trends, new product forms and
regulatory changes.
Maintaining rates, rules and forms across 50
jurisdictions is a complex and labor intensive
process

SAP circular authority for insurance
Better product development keeping up with ISO
Improve quality and compliance
of an insurer’s ISO-based
products. Content is interpreted
by ISO, delivered electronically,
and presented in a business-
friendly way.
 Improved compliance
 Reduced state fines
 Better legal protection
 More accurate pricing
Improve speed to market and
reduce the effort required to
analyze and interpret ISO
circulars
 High-value workers freed up from
interpretation task
 Increased capacity for product
change
 Cloud-based: low acquisition and
operating cost
Keep up with ISO
 Latest ISO Product = Solid
Foundation for Competitive
Company Products
 Pricing Accuracy = Greater
Profitability
 Latest Policy Language = Reduced
Legal Exposure
 Formal Specifications = Business/IT
Alignment

With financial management for CFO
Lower financial closing
FTE cost when the
financial system supports
internal and external
accounting requirements
56%
Lower general ledger and
financial closing costs when
general ledger and financial
systems are integrated to
produce accurate data
90%
Lower days to annual close
when general ledger system
supports multiple-currency
accounting processes and
entries
19
Little transparency across the enterprise
Ever-changing regulatory requirements
Slow response to market dynamics
Managing risk and compliance in real-time
Reducing claims fraud
Fast and timely closing of the general ledger

SAP cloud for financials solution
Delivering better financial transformation
SAP on Cloud benefits
 Complete coverage of end-to-end
accounting value chain
 Real time insights and
collaboration
 One single source of truth with
central financial data repository
 Equip cost center owners with
easy-to-consume real time apps
 Trusted reporting and analytics
 Detect, prevent, monitor and
investigate claims fraud
 Streamlined and integrated fast
close processes
Comply with global
financial reporting
requirements
Overseeing all
accounting operations
Define and execute
business plans
Provide strategic insight
across the enterprise

Source: SuccessFactors impact study for Financial Services
Loss of key talent: Recruit and retain leading talent to the
insurance industry
Ability to support and motivate diverse sales organization
including agents and brokers
Establish focus and accountability, resulting in clear
correlation between performance and pay
Globalization of workforce: Increase support for domestic
and global compliance and reporting
Recruitment & training of multi-channel workforce requires
multi-channel strategies
Align workforce with business strategies faster and
sustainably
Engage employees and contractors with modern learning
capabilities
15.2%
decrease in turnover
13.8%
decrease in low
performers
13.7%
increase in internal
job fill rate
14%
increase in project
completion
With human resources management for HR executives

SuccessFactors, an SAP company
Delivering one set of HR Solutions across the entire employee lifecycle
SuccessFactors is the leader in Gartner's’ Magic Quadrant and the leader in Forrester’s Wave
SuccessFactors Delivers
 Complete global solution
across all HR functions
 Business applications
designed for how people
work
 Data analysis, insight and
guidance across the
enterprise to help drive
maximum business impact
 Flexible and extendable
architecture to start
anywhere, go everywhere
Succession and
Development
Core HR & Payroll: Employee Central
Employee Record | Organizational Management | Payroll | Shared Services
Time Sheet | Global Benefits
CompensationPerformance
and GoalsLearning
Recruiting and
Onboarding
Competencies, Skills, Best Practices
Analytics
SAP HANA In-memory Computing Platform
Mobile and Social

With B2B networks for head of procurement
Improvement in
compliance
60%
Reduction in price
4-15%
Improvement of
working capital
20%
Source: Ariba Benchmarking
High expense ratios due to missed cost savings for both
internal and claims procurement
High operating and supply chain costs
Manual paper-based collaboration, point to point EDI,
portals and single process solutions
Long sourcing and contracting cycles
Wasted time in identification of new, competitive sources
of supply
Manual and ineffective insight into supplier behaviors and
capabilities

Ariba Delivers
 Lower claims costs and
improved customer service
 Enhanced buying power and
reduced costs
 Discovery of new sources of
supply
 Reduced supply chain costs
and risk
 Better visibility and predictability
Suppliers
Buyers
Ariba Source-to-Pay Solutions and the Ariba Network
Delivering Realized Savings
Spend
Analytics Sourcing
Contract
Management
Operational
Procurement
Invoice
Management
Supplier Management

© 2014 SAP SE. All rights reserved. 18For internal and SAP partner use only
Challenges in Insurance
Strategically engaging your workforce with collaboration
Increasing speed, lowering costs, and improving onboarding
and ongoing skill development of global workforce
Increasing competitive edge by connecting sales and
marketing to collaborate and deliver superior content
Enhancing collaboration, innovation, and issue resolution
with suppliers throughout procurement lifecycle
Lowering financial risks, streamlining compliance processes
and reducing exception handling costs
Deepening innovation with customers and communities
throughout product development to speed market delivery
Increasing customer satisfaction and developing enduring
customer loyalty through prompt issue resolution and deep
engagement
2X
Value from better enterprise
communication and
collaboration*
$1.3 trillion
Annual value that can be
unlocked by social
technologies*
Value from improvement in
customer interactions*
40-60%
*Source: McKinsey Global Institute (2012)

SAP Jam
Bring together people, data, content and process to deliver results
SAP Jam delivers
social collaboration
 Where you work
 To drive results
 On a secure social
foundation
SAP Jam is a Visionary, Gartner Social Software Magic Quadrant 2010-2013 and a Leader in IDC MarketScape 2012

With big data and data management for CIO
Of companies have a
360 degree view of their
customers
16%
Greater ability to utilize Big
Data to gain insights with a
well-established analytics
and data-modeling center
of excellence
40%
Higher operating
effectiveness with ability to
monitor business in real-time
39%
Exponentially increasing amounts of structured and
unstructured data
Global compliance reporting
Ancient data silos and aging infrastructure
Data cleansing and separating good data from the white
noise data
The need for real-time data
Risk data aggregation

Innovate faster at minimized investments and risks
Eliminate capital expenditure for infrastructure and
operations
React faster to emerging trends
Leverage cutting edge technology
Minimize disruptions to running systems
Leverage the best suited deployment options

Cloud options with SAP HANA
Subscription or bring your own license, elasticity, ubiquitous access
SAP offers a wide range of deployment options to support your requirements
Private Cloud,
HybridPublic Cloud On Premise
Partner ScaleAny Scale Elastic ScaleLimited Scale
SAP HANA One
Public Cloud (AWS)
• Subscription license at
99 cents / hour
• 30GB of compressed
data max
SAP HANA
On Premise
• Ten certified hardware
partners
• Scales to any size
SAP HANA
Enterprise Cloud
Managed Cloud
• Enterprise-grade cloud
• Mission critical 24 x 7
Open
Cloud Ecosystem
• Cross-license
reference architecture
• Portability

Managed cloud as a service from trusted partners
Subscription pricing with cloud agility and economics
* VMS AG SAP Managed Cloud as a Service (MCaaS); July 2013
SAP-proven solutions available via partner-
delivered private cloud environment
 Cash preservation/optimization with
subscription-based opex model
 Reduced IT costs – 30% lower total cost of
ownership (TCO) over on premise*
– 51% of the savings realized in the first year*
 Rapid time to value
– 90% improvement in implementation time *
 Fully managed, enterprise-class solution with
proven partners

Cloud computing benefits for insurance
Dramatically improve the economics and business agility of your company
Shorter time to value
• Adopt new technologies
quickly
• Always have the latest
versions of the
application
• Leverage well-tested IT
best practices
Cost reduction
• Cloud-based solutions
require less up-front
capital investment
• Eliminate capital
expenditure for
infrastructure and
operations
Lower barrier
to innovation
• Bring new, compliant
products to market more
quickly
• Expand domestically
and even internationally
more rapidly with a
lighter IT footprint
Scalability
• Add new channels,
partners or suppliers
more easily and in far
less time than traditional
application architectures
would have needed
• Support M&A activity
flexibly

Best-run customers in the cloud
1.2 million
connected companies
from 190 countries
collaborating on >$600B
worth of commerce
annually. That’s 3X-50X
the size of any other
business network
30 million
cloud users
2 million
Cloud deployments

Unmatched SAP expertise and traction
Source: SAP analysis of Forbes 2000 rankings (May 2013) and SAP customer database as of May 2013
Insurance companies run SAP
• Ten of the top 10 property and
casualty insurers
• Nine of the top 10 life insurers
• The top 4 reinsurers
19 out of
Top 20
All lines of business supported
on a single platform
Deep industry-specific
capabilities
Embedded preconfigured
best practices
Clear industry road map
4500+ Insurance customers worldwide
Insurers88%
88% of the insurance providers
in the Forbes Global 2000 are
SAP customers.

Analyst sentiment about cloud offerings from SAP
Source: Gartner “Magic Quadrant for Talent Management Suites”, March 2013; Gartner “Magic Quadrant for Strategic Sourcing Applications Suite, July 2013; Ovum
View, December 2012 http://ovum.com/2012/12/18/saps-financial-services-network-offer-may-provide-lessons-for-ariba/ ; PAC Blog, July 2012 http://blog.pac-
online.com/2013/05/sap-builds-cloud-offering-around-hana/
SuccessFactors is
the leader in
Gartner’s 2013
Magic Quadrant
for Talent
Management
Suites.
Ariba is a leader in
Gartner’s 2013
Magic Quadrant
for Strategic
Sourcing.
SuccessFactors
Named a “Leader"
for Fifth
Consecutive Year
in IDC
MarketScape
Worldwide
Integrated Talent
Management
Report for 2013
“HANA Enterprise
Cloud offers
companies a good
way to deploy SAP
HANA without
heavy investment
into hardware.”
PAC

SAP: Your partner for co-innovation
SAP for Insurance:
SAP customers represent
Ten of the top 10 property and
casualty insurers.
Integrated insurance platform
Leveraging key breakthrough
innovations
40 years of delivering value to
insurers

Initiate
the benchmarking
process with a free value
assessment at
valuemanagement.sap.com
Engage
in Design Thinking
workshops
Contact
our account team to
schedule a meeting
Next steps
Experience
it yourself at the next SAP
event near you or check
out SAP global events, or
arrange an individual
demonstration

© 2014 SAP SE or an SAP affiliate company. All rights reserved. 31For internal and SAP partner use only
© 2014 SAP SE or an SAP affiliate company.
All rights reserved.
No part of this publication may be reproduced or transmitted in any form or for any purpose without the express permission of SAP SE or an
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