Towers Watson Introduces Updated Version of MoSes Financial Modeling Solutions for U.S. Life Insurers

To help U.S. life insurers improve risk and capital management, global professional services company Towers Watson (NYSE, NASDAQ: TW) has released an updated version of their suite of advanced financial modeling software.

Towers Watson’s MoSes U.S. Life Modeling Suite (USLMS) version 1.1 includes new applications for modeling fixed annuity, fixed indexed annuity and term life products. This software also provides enhancements to existing applications for variable annuity (VA) and universal life (UL) products, as well as improvements to asset modeling, economic scenario generation and reporting capabilities common to all applications in the suite.

"We are pleased to be able to extend innovative modeling approaches that we first introduced for variable annuity and universal life products to a broader set of life insurance products,” said Todd Erkis, Towers Watson’s global life software product manager. "We have seen very positive feedback from our clients using these techniques, which our consultants have also used to help insurers solve business problems.”

MoSes USLMS supports nested-stochastic inner-loop valuations. Further, asset/liability interactions can be in both inner and outer loops for more realistic results than other simplified approaches. The applications calculate point-in-time and projected values on a statutory principle-based approach (PBA) and GAAP basis using dynamic, real-time calculation techniques. Moreover, they are optimized for distributed processing on a grid or compute cluster so that insurers can calculate sophisticated financial analytics in less time.

More information about the MoSes USLMS is available online at http://www.towerswatson.com/uslms.

Note to editors:

Generally Accepted Accounting Principles (GAAP) is a codification of how CPA firms and corporations prepare and present their business income and expense, assets and liabilities on their financial statements. The various rules and pronouncements come from the Financial Accounting Standards Board (FASB), which is a nonprofit organization that the accounting profession has created to promulgate the rules of GAAP reporting and to amend the rules of GAAP reporting as occasion requires.

Principle-based approaches (PBA) to calculating reserves and risk-based capital requirements are replacing long-standing formulaic approaches. The goal of PBA is to more accurately capture the underlying risks in contracts using economic analysis that reflects product designs and the risk profile of the issuer. PBA reporting is required by statutory law for calculating risk-based capital and reserve requirements for some insurance products, with additional PBA requirements for other products expected in coming years.

Nested stochastic calculations are required to project financial results with calculations that dynamically reflect the impact of evolving conditions across a variety of scenarios. Along each base scenario, the projection stops at each recalculation point to perform a set of nested calculations to assess a value before continuing on with the base projection. This methodology requires considerable computing power. MoSes USLMS applications are designed to perform such calculations efficiently and to take greater advantage of distributed processing for faster results.

About Towers Watson

Towers Watson (NYSE, NASDAQ: TW) is a leading global professional services company that helps organizations improve performance through effective people, risk and financial management. The company offers solutions in the areas of employee benefits, talent management, rewards, and risk and capital management. Towers Watson has 14,000 associates around the world and is located on the web at towerswatson.com.