Impacts of Policy Number Changes Doubling of risk within retention management processes resulting in overstated NAR amounts reinsured/retroceded and premiums remitted. Overstatement of reserves. Potential overpayment of benefit amounts if error not detected on a timely basis. Business partner could associate the conversion or exchange with an incorrect treaty impacting profitability results, incorrect share percentages, incorrect premium and allowance structures. Compromises identification of policies eligible for recapture if the conversion or exchange is not reported as such. Best Practices Advance communication of the scenario(s) resulting in policy number changes to the business partners. Utilize System, Data, or Administration Changes to Business “RAPA-Communicating Partners” document developed by the RAPA Data Initiative to share advance policy number format changes. Include a description of the change applied and the reporting period the change will take effect, i.e. ABC prefix to each policy associated with the block of policies ‘Adding acquired from ABC Insurer, adding leading zeros to the policy number, etc. If there is no logic that can be applied to the change, provide a listing of old policy number to new policy number. Scenarios Administrative system conversion - Change to new platform as represented in the following examples: New platform may not allow for the policy number to remain the same. Internal Migration/Implementation to new platform decisions may drive formatting of policy numbers. Previous multiple system solutions into one standard solution renumber all with – consecutive numbers. Previous multiple system solutions into one standard solution add – leading/ending character(s) to preserve historical system solution. Improved product functionality in new platform. Correction of inconsistencies in prior policy number assignment (generally occurs with manual administrative solution -Excel or Access DB). Larger field size, so zero fill (beginning or end). Policy Conversions or Exchanges Reported as New Business instead of Conversion In or – Exchange:
Impacts of Policy Number Changes Doubling of risk within retention management processes resulting in overstated NAR amounts reinsured/retroceded and premiums remitted. Overstatement of reserves. Potential overpayment of benefit amounts if error not detected on a timely basis. Business partner could associate the conversion or exchange with an incorrect treaty impacting profitability results, incorrect share percentages, incorrect premium and allowance structures. Compromises identification of policies eligible for recapture if the conversion or exchange is not reported as such. Best Practices Advance communication of the scenario(s) resulting in policy number changes to the business partners. Utilize “RAPA-Communicating System, Data, or Administration Changes to Business Partners” document developed by the RAPA Data Initiative to share advance policy number format changes. Include a description of the change applied and the reporting period the change will take effect, i.e. ‘Adding ABC prefix to each policy associated with the block of policies acquired from ABC Insurer, adding leading zeros to the policy number, etc. If there is no logic that can be applied to the change, provide a listing of old policy number to new policy number. Scenarios Administrative system conversion - Change to new platform as represented in the following examples: New platform may not allow for the policy number to remain the same. Internal Migration/Implementation to new platform decisions may drive formatting of policy numbers. Previous multiple system solutions into one standard solution – renumber all with consecutive numbers. Previous multiple system solutions into one standard solution – add leading/ending character(s) to preserve historical system solution. Improved product functionality in new platform. Correction of inconsistencies in prior policy number assignment (generally occurs with manual administrative solution -Excel or Access DB). Larger field size, so zero fill (beginning or end). Policy Conversions or Exchanges – Reported as New Business instead of Conversion In or Exchange:
Reinsurance-Reporting-Guidelines-and-Best-Practices-Version-3-15-October-2015.docx