By turning to Windows Azure, Milliman helped one client tackle a significant IT and regulatory challenge—and in the process, created a solution that can help insurance companies transform the way they handle mission-critical actuarial work. The cloud-based version of MG-ALFA is massively scalable, providing enormous flexibility for companies that must deal with the ebb and flow of their actuarial computing needs. It is cost effective, helping companies save money over traditional IT infrastructure solutions. It also provides the kind of reliability and enhanced security needed for critical business operations involving confidential data.
“Windows Azure offered the platform to create a powerful cloud-based solution that not only meets the needs of one insurance company,” says Renzi, “but also could transform the way that the entire industry performs compute-intensive, mission-critical work.”
Provides Massive Scalability on Demand
MG-ALFA is a complex, powerful software solution that can distribute calculations across thousands of processors. By porting the solution to Windows Azure, Milliman eases computational workloads for its business clients by taking advantage of Windows Azure Compute capabilities, which can be scaled up or down as needed.
Van Beach, Product Manager for MG-ALFA at Milliman, notes that a typical Solvency II reporting cycle can involve over 2 million simulations involving a complex range of variables.
“The Solvency II process involves incredibly complex calculations requiring intense computing capabilities to meet the prescribed reporting deadlines. That further intensifies the computing capacity crunch,” he explains. “For Phoenix and other companies complying with Solvency II, that means every three months there will be a massive spike in demand. With Windows Azure, our clients can quickly scale up for the massive computations involved in running scenarios, and then just as quickly scale down when the processing is not needed.”
Cuts IT Costs by 30 Percent or More
With the MG-ALFA cloud-based solution, Milliman clients pay only for the processing and storage capabilities they need, without having to deploy, manage, and upgrade hardware.
“We estimate that if a grid is used 60 percent of the year, running MG-ALFA operations on Windows Azure can cut the traditional $3 million cost for a traditional on-premises system by at least one-third,” says Reid. “With Windows Azure, companies avoid large capital expenses, because the MG-ALFA solution can access high-performance computing resources on demand at a small fraction of what it would cost to own and operate those resources.”
Delivers Reliability and Enhanced Security
Security and reliability are major concerns for financial services companies. That is why Windows Azure, which is run in Microsoft data centers, is a good choice for an industry solution, says Renzi.
“Windows Azure is an enterprise-grade platform with attendant security and reliability,” she says. “And, because Microsoft has data centers worldwide, information can be hosted in jurisdictions appropriate to the client.”
Milliman employs numerous measures to maintain high availability of its computing resources. Milliman staff provides 24x7 monitoring of services using proprietary diagnostics, event management, and other service management techniques. With the built-in replication functionality in Windows Azure, Milliman can quickly recover from any individual data-center service interruptions in the rare event of an outage.
Renzi says the solution delivered an impressive performance running on Windows Azure. During a six-month period beginning in late 2011, Phoenix had several periods during which it operated 10,000 compute engines on Windows Azure for multiple days and ran smaller jobs in between.
“The jobs had a 99.98 percent completion rate,” says Renzi. “Windows Azure delivers great reliability while freeing companies like Phoenix from the processing bottlenecks that occur in single hosted services. Windows Azure was instrumental in helping us deliver a robust, dynamic risk management solution that stretches the boundaries of what is possible in enterprise computing.”