Towers Watson Issued U.S. Patents for Insurance Industry ‘Smart Modeling’ Technique
March 15 2012 - 10:17AM
Business Wire
Global professional services company Towers Watson (NYSE,
NASDAQ: TW) announced today that the United States Patent and
Trademark Office (USPTO) has issued two key patents for its
innovative Replicated Stratified Sampling (RSS) financial modeling
technique for the insurance industry. Both patents (U.S. Patent No.
8,126,747, issued February 28, 2012, and U.S. Patent No. 8,131,571,
issued March 6, 2012) cover Towers Watson’s RSS smart modeling
technique that is intended to dramatically speed up run times for
complex insurance calculations and help industry executives better
understand risk.
“The insurance industry has been struggling with how to
accurately understand all risk exposures in real time while
offering products that serve consumers’ needs. A lack of robust,
real-time modeling tools has contributed to management’s struggle
to fully understand and measure risk exposure,” said Steve
Bochanski, a senior consultant in Towers Watson’s Risk and
Financial Services consulting group. “We believe our proprietary
RSS modeling technique will provide insurers and other financial
services companies with a faster and smarter approach.”
The Towers Watson RSS modeling technique uses statistical
sampling to accurately measure changes in risk metrics while
producing dramatic reductions in run time. Sampling has long been
used in other industries, in applications as familiar as television
ratings and consumer polls. But in the insurance industry, where
access to the full population of contracts is not a barrier,
sampling has not been commonly used in the past.
Bochanski notes that the RSS technique offers key benefits over
other methods that make it the best option available. “The fact
that sampling is already widely used makes this approach easy to
understand and explain to users, senior management and external
constituencies,” said Bochanski. “In addition, with RSS, the user
has full control over the balance of speed and precision, and it
works with insurers’ existing models and actuarial software.”
“The RSS technique is truly a new and innovative approach to a
classic problem,” said Dr. Jay Vadiveloo, a senior consultant at
Towers Watson and professor at the University of Connecticut, who
invented the RSS method. “I am very proud to have pioneered this
development and to have secured these patents. We believe RSS is
part of the next generation of modeling techniques, one that will
ultimately simplify the financial modeling process for users.”
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.