Chubb Business

Capabilities
Version 2
February 2010

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Chubb Business Capabilities v2 Groups

Marketing & Sales

Product

Determine, measure and enable the

markets to be served. Support the sales
of products and services to those
markets through selected channels.

Customer Relationship Management

Risk Management
Design, develop, implement and maintain
products and services.

Policy & Contract

Create, underwrite, and administer individual
policies, contracts, and/or value added services.

Identify, manage interactions and

measure performance of the
policyholders and prospects.

Identify, enable, manage and measure

the channels by which products are to
be distributed and serviced.

Financial

Generate, invest, and administer

funds to support the enterprise.
Measure and project financial
performance.

Claim
Channel

Determine, mitigate, and manage

risks generated externally and
internally and assumed as part of
insurance operations.

Evaluate, adjudicate, investigate and settle claims

against policy terms & conditions. Manage loss reserves
and other financial aspects of individual claims.

Business & Enterprise Support

Define, manage and support business strategy and operations in areas that
are not unique to Property and Casualty companies. Functions that are
needed to operate the business.

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Chubb Business Capabilities v2

Product
Product

Marketing
Marketing &
& Sales
Sales
Sales
Strategy

Product
Strategy

Product
Innovation

Product Research
and Analysis

Product
Performance

Marketing Plan
Management

Sales Plan
Management

Product Life Cycle

Management

Product Definition
and Design

Product
Implementation

Rate, Rule &

Form Filings

Market Research &

Analysis

Promotion
Implementation

Prospecting

Campaign
Execution

Sales Enablement

Policy
Policy &
& Contract
Contract

Sales Execution

Customer
Customer Relationship
Relationship Management
Management
Customer
Relationship
Strategy

Customer
Relationship
Management

Customer Profiling
and Modeling

Customer Value
Added Services

Channel
Channel

Risk
Risk Management

Marketing
Strategy

Channel
Segmentation
Strategy

Channel Research
And Analysis
Recruitment
Channel Value
Added Services**

Policy
Administration
Strategy

Service Contract
Administration
Strategy

Policy
Administration
Mgmt

Service Contract
Administration
Mgmt

Submission
Intake

Policy Risk
Decisioning

Policy Acceptance

Policy Event
Handling

Premium Audit

Policy 3rd Party

Administration

Policy Audit

Policy Value Add

Services

Customer Interaction
Handling

Claim
Claim

Channel
Relationship
Strategy

Effectiveness
Management
Performance
Analysis
Mandated Channel
Administration

Relationship
Management

Catastrophe
Planning

Claim Mgmt
Strategy
Claim
Management

Medical
Management

Litigation & Expense

Management

Catastrophe
Management

Claim Notification

Claim Handling

Fraud/SIU

Catastrophe
Mobilization

Recovery

Claim Audit

Claim 3rd Party

Administration

Agreement
Administration *

Underwriting
Strategy/Exposure

Reinsurance
Strategy

Compliance
Strategy

Underwriting
Management

Reinsurance
Management

Regulatory and
Compliance
Management

Risk and Exposure

Assessment

Reinsurance
Administration

Regulatory
Compliance

Aggregate
Risk Decisioning

Loss Control

Regulatory &
Statutory Reporting

Actuarial Analysis
/Pricing

Financial
Financial
Capital Strategy

Treasury Strategy

Investment Strategy

Capital Management

Treasury & Cash

Management

Investment
Management

Budget Management

Tax Management

Investment
Execution

Financial Reserve
Management

Billing

Financial
Reporting & Metrics

Accounts Payable

Payments
Receivables &
Collections

Compensation

Accounting

Business
Business & Enterprise Support
Business
Management

HR

Facilities
Management

Operations
Management

Legal

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IT

Public
Relations

Definitions Marketing & Sales

Marketing Strategy

Develop the strategic marketing goals, objectives, and an approach to promote, distribute and target market
segments for specific products based on understanding of the market conditions for those products.

Marketing Plan
Management

Oversee and manage the activities in the preparation and execution of a marketing plan. This capability includes
reviewing and prioritizing opportunities and then aligning these opportunities with the best distribution channel and
sales message. It includes updating the opportunity pipeline with the status of where we are with a specific
opportunity at a given stage.

Market Research
and Analysis

Gather, record and analyze data about customers, channels, competitors and the markets. Market Intelligence
includes information such as: why we win or lose business; what the distribution channel specialties are; who the
incumbent carriers are for new submissions or prospects; what is our percent of market share for a specific
distribution channel.

Prospecting

Identify specific new business opportunities in the marketplace and engaging the agent in a manner that leads to a
submission.

Promotion
Implementation

Carry out & analyze the results of specific promotions aimed at increasing corporate image, brand recognition and
market demand for products.

Campaign Execution

Carry out a marketing campaign targeting particular products and services to a specific market.

Sales Strategy

Develop the strategic sales goals, objectives and an approach to be used to market products to prospects.

Sales Plan
Management

Oversee and manage the activities involved in preparing a plan that will be used to sell products to customers
through distribution channels. This capability includes creating plans that enhance our opportunities based on
recording and periodically assessing the performance of the distribution channels.

Sales Enablement

Equip an organizations sales force with tools, information, and training.

Sales Execution

Understand the financial needs of a person or organization and how those needs can be met by the products and
services of the selling organization. Prepare and deliver a quote for proposed products and services, negotiating the
terms of the agreements being proposed, and transitioning the quote into a commitment for a submission.

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Definitions Customer Relationship

Management
Customer Relationship
Strategy

Determine the strategies:

that define the kinds of relationships Chubb will have based on customer profile types,
that define what comprises the features and value-added services for the kinds of relationships identified,
that describe target customer profiles based on business need, for the management and sharing of
customer and associated relationship information

Customer Relationship
Management

Create the policies and procedures for understanding, managing and optimizing relationships and relationship
information for customers, prospects and other relevant parties. Establish measurements for the
achievement of the customer relationship strategy, including customer satisfaction and the effectiveness of
value-added services.

Customer Profiling and

Modeling

Gather, analyze and administer relationship and profile data from all available sources (electronic, manual,
internal and external). This includes defining and visualizing Chubb's relationships with customers, and
customers' relationships with others of varying roles (i.e. party to party, party to business information). Analyze
and model customer information to project behavior and characteristics for use in developing customer
relationship strategies or refining relationship management policy and procedures.

Customer Interaction
Handling

Identify and administer customer preferences for interaction, communications and other touch points. Initiate,
execute, document and track interactions from, with or about the customer.

Customer Value Added

Services

Identify and provide customer-centric services, education or training that are not necessarily part of the policy
contract, which support and/or help the customer during any prospecting, policy or claim activities, and which
enhances the Chubb-customer relationship.

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Definitions Channel
Channel
Segmentation
Strategy

Determine the strategy by which distribution channels of Chubbs products and services are identified
and establish plans to achieve the desired distribution.

Channel Research
and Analysis

Conduct research on the types of available distribution channels, and analyze their alignment with the
channel segmentation strategy and viability as distribution channels for Chubb.

Recruitment

Target and solicit identified distribution channels for the purposes of being able to use that channel for
business revenue

Channel
Relationship
Strategy

Determine the strategy for establishing and maintaining relationships with entities and individuals that
distribute Chubbs products and services, and establish plans to achieve the desired relationships.

Relationship
Management

Create policies and procedures which permit the channel relationship strategy to be achieved; establish
measurements to ensure the strategy is achieved; monitor the measurements and evaluate the choice
of measurements.

Effectiveness
Management

Create policies and procedures which ensure the effectiveness of all channels; establish measurements
to ensure the ongoing effectives of the channels; monitor the measurements and evaluate the choice of
measurements.

Mandated Channel
Administration

Administer all aspects of distribution channels which are required based on the business of Chubb.
Includes channels such as mandated pools and syndicates.

Compensation

Administer all facets of the compensation policy for all relevant distribution channels. Includes the
producer and the non-producer channels.

Channel Value
Added Services

Provide additional supporting services directed at the various distribution channels. Includes services
such as Education Enablement, Loss Runs and producer visits.

Performance
Analysis

Analyze performance results for all distribution channels, such as profitability, retention, net volume, and
growth.

Agreement
Administration

Administer all aspects of distribution channel agreements and contracts. Includes Producer Contracts
and Compensation Agreements, Licensing and Appointments. Also includes contracts for non-producer
distribution channels (i.e. alliances) as they may apply.

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Definitions Product
Product Strategy

Establish the strategic direction for the overall portfolio mix of Chubb products and services that address
market needs, support risk management objectives, achieve corporate growth and financial targets, and
position Chubb as a leader in the industry.

Product Innovation

Determine and anticipate market needs for new, innovative, and profitable products, coverages, and services.
Identify opportunties and propose new products, coverages, and services that deliver unique benefit to the
customer, provide potential for profitable growth, and contribute to competitive position in the market place.

Product Research and

Analysis

Conduct research and analyze various characteristics of an insurance product, coverage, or service offering.
Determine its viability to meet customer needs, to be effectively underwritten, and to produce a superior
return.

Product Life Cycle

Management

Develop policies and procedures governing how we develop, design, implement, and maintain products,
coverages, and services.

Product Performance

Analyze and measure profitability of products, coverages, and services against established targets including:
growth, revenue generation, loss projections, etc. Recommend enhancement options.

Product Definition and

Design

Create plans and manage/execute activities to define and design new products in accordance with standard
product development methodology. Create and maintain product specifications including coverages, limits,
deductibles, rates, premium calculations, forms, statistical codes, selling/underwriting rules, etc.

Product Implementation

Create plans and manage/execute activities to implement and release new products & services. Define and
execute activities addressing the process, human, and technology aspects of product implementation and
deployment.

Rate, Rule, and Form

Filing

Execute & manage filing and approval activities for products, rates, rules and forms.

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Definitions Policy & Contract

PolicyAdministration
Policy
Administration
Strategy
Strategy
Service Contract
Administration Strategy
Service Contract Administration
Strategy
Policy Administration
Management
Policy Administration
Management
Service Contract
Administration Mgmt
Service Contract Administration
Management

Develop the organization's goals, objectives, and approach to Policy Administration in order to fully process and administer all
transactions associated with capturing, quoting, issuing and managing an insurance policy from inception through the entire life-cycle of
the
policy.
Making
distinction for contracts that are not policies, the sub capability to administer.
Develop the organization's goals, objectives, and approach to managing the administration of offered services.
Create guidelines and procedures which permit the policy administration strategy to be achieved; establish measurements to ensure the
strategy is achieved; monitor the measurements and evaluate the choice of measurements.

Making distinction for contracts that are not policies, the sub capability to administer. 09/25/2009: Examples are Wildfire
Services, Appraisal/Inspections, Surety, Loss Control.

Create guidelines and procedures which permit the service contract administration strategy to be achieved; establish measurements to
ensure the strategy is achieved; monitor the measurements and evaluate the choice of measurements.

Submission
Intake
Submission Intake

The
initiation
of what
could become
in the form
of a new
Collect
and process
information
suppliedatopolicy
the insurance
company
by thebusiness
applicantsubmission.
in consideration for an insurance offering or quote

Policy Servicing
Policy Risk Decisioning

All functions associated with changing or renewing an existing policy. 09/25/2009: Endorsement, Cancel, Renewal
activity
intoprice
this capability.
Process falls
the rate,
and quote functionality required of a policy term:

Value Added Services??

Policy 3rd Party Administration
Rate
Policy Acceptance
Quote
Book
Policy Event Handling
Policy Risk Decisioning
Premium Audit
Policy
3rd Party
Administration
Bind and
Issuance
Policy Audit
Policy Audit
Premium Audit
Policy Value-Add Services

based on factors such as type of insurance, subjects of insurance, and coverage requested.

- Calculate the amount of money to be paid by the policy owner, based on product specifications, to the insurance company for the
benefits provided under an insurance policy.
- Assess the risk involved in issuing or modifying a policy, including determining the appropriate terms, conditions and price for
any
third the
parties
in the
of TPA.
assuming
risk, are
and included
potential need
fordefinition
reinsurance.
- Prepare and deliver (potentially through many iterations) the cost and value of proposed products and services, including negotiating
Calculate
based on product
specification.
Applicable to new business, renewals, and endorsements and changes
the terms ofprice
the agreements
being proposed
.

where the distinct function of rating is performed.

Process the bind, book and issue functionality required of an accepted policy:
Package
communicate
in the
form ofofaaquote
along with
any before
necessary
additional
or information.
- Establishand
binder
agreement torate
put the
provisions
policy/contract
in-force
it hasor
been
written ormaterials
the premium
has been paid.
Applicable
to new business, renewals, and endorsements and changes where the distinct function of rating is performed.
- Record premium transactions from the policy administration system to the corporate financial system(s).
- Create and distribute the final policy document(s).

Book in included as part of the Policy and Contract Capability Grouping as opposed to Financial, because it is the
process that is a part of policy administration that flows to financial.

Process policy changes and transactions during the in-force policy term and creation of subsequent terms. It includes changes to terms
and conditions, changes to insured or policy information, and changes in risk or exposure. Examples include, but are not limited by,
Underwriter
evaluation in making a decision to accept risk associated with a policy and if so at what price.
events such as endorsements, cancels, and extensions.

Two activities identified for this capability are a) Pricing (accept risk and if so, at what price?) and b) Contract
Modification
Perform methodical examinations of an insured's operations, records and books of account. The audit is performed to determine the
actual
insurance
exposures
the coverage
provided
with a report and premium adjustments if required.
Includes
Faculatative
andforTreaty
Reinsuance
as and
partconcluded
of decisioning.

Manage
theseparated,
integration could
requirements
a Third Party
to administer
support09/25/2009:
of Policy andTwo
Contract
processing.
Thisfor
canthis
be
Could be
be left of
together,
should
revisit at activities
definitioninstage.
Activities
identified
viewed
as "outsourcing"
the administration
of Step
aspects of the policy processing, since the TPA is performing a task traditionally handled
capability
are a) Bind Step
and b) Issue
by the company providing the insurance. A Third Party Policy Administrator may be used for their expertise, for group programs or when
it
is more costreview
effective
doing the
sameassurance.
processing in
house. to Premium Audit, below. May merge? If so, ned to make
Operational
ofthan
process,
quality
Unrelated

consistent with Claim Audit in Claim.

Monitor the processing of individual policies to assure adherence to rules and guidelines and identify opportunities for improving policy
handling skills.

We took Premium Audit out of Risk, and put it in Policy and Contract. This sub-capability reflects when we audit
individual
policiesservices
in order
more premiums
to a other
change
exposure.
Provide
value-add
to to
ourget
customers;
these are due
services
thaninindemnity
in response to a covered loss. Examples include
appraisal or inspection services.

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Definitions Claim
Claim Management Strategy

Developing the claim organization's goals, objectives, and approach to handling claims.

Claim Management

Oversight and control of claim reserves, claim outcomes, alignment of staff, claim metrics and reporting.

Medical Management

Oversight and control of medical cost containment, medical provider networks, bill review, case management and
medical related regulatory compliance.

Litigation and Expense

Management

Oversight and control of litigation inventory and expense, house counsel and the panel attorney network, defense
counsel referrals and trial protocols and other allocated/unallocated adjustment expenses.

Claim Notification

Handling the initial notice of a claim as reported by the insured, their agent, or a claimant including the capture of claim
and claimant information, initial claim validation, and a trigger to follow-on process activities.

Claim Handling

Investigation, documentation, evaluation and resolution of individual claims, which includes the posting of claim reserves
to record loss and expense exposure on financial records, litigation and alternative dispute resolution, and the delivery of
benefits or settlement agreements in order to close claims.

Fraud/Special Investigation
Unit (SIU)

Identification and resolution of claim requests for losses that did not occur or were caused with an intent to collect
insurance benefits, or are for claimed amounts that deliberately exceed actual loss amounts

Recovery

Procurement of funds that offset the cost of benefits provided for a claim from external parties that may have shared
liability for the loss or that may purchase assets that become the property of the insurer as a result of the settlement.

Claim Audit

Monitor the handling of individual claims to assure adherence to rules and guidelines, identify opportunities for increased
claim handling skills and reduction of leakage.

Claim 3rd Party Administration

Third party claim handling arrangements in order to meet an insureds specific claim servicing requirements pursuant to
agreements negotiated between the insured, underwriting and claim departments.

Catastrophe Planning

Ensuring that the appropriate capabilities have been identified and planned for in the event of a natural or man-made
catastrophic event.

Catastrophe Management

Oversight and control of catastrophe preparation and workflows, the assignment of claim resources and their
mobilization in response to natural or man-made catastrophes.

Catastrophe Mobilization

Mobilization of onsite resources, triage and appraisal of losses incurred by natural or man-made catastrophic events.

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Definitions Risk Management

Underwriting Strategy

Determine, document, and communicate the overall approach, policies, and guidelines by product and
customer segment to maximize profitability while retaining strong business and enabling opportunities for
growth.

Underwriting Management

Monitor and assess underwriting activity to determine where underwriting staff are following the strategy and
where they are not. Communicate expectation and provide specific expectation of performance. Add
guidelines. creation and communication.

Risk and Exposure

Assessment

Monitor and assess the changing areas of risk and exposure over time that may drive changes to underwriting
strategy and management.

Aggregate Risk Decisioning

Manage a book of business. Understand and rationalize situations where deviations from the strategy are
acceptable (tough accounts), and ensuring they are balanced with strong accounts so that the overall book is
profitable. Assess total liability of book to determine actions to take, including reinsurance.

Actuarial Analysis/Pricing

Collection and assessment of actual premium and loss trends to identify and recommend pricing adjustments
in the Underwriting strategy by product and customer segment.

Reinsurance Strategy

Define and document the procedures for determining reinsurance to be purchased, the net risk to be retained,
how reinsurers will be selected and how the reinsurance program will be monitored.

Reinsurance Management

Develop Corporate guidelines and approaches for placement of reinsurance (both treaty and facultative, as
well as amount and type) to mitigate company's exposure to loss. Determine the amount to automatically
cede through treaty and the guidelines regarding facultative placement. Includes monitoring compliance to
treaty and/or reinsurance guidelines (e.g. criteria for determining acceptable reinsurers and criteria for
handling reinsurance) as well as managing approach and exceptions to guidelines and/or treaty.

Reinsurance Administration

Execute reinsurance agreements (including negotiating terms and conditions) with reinsurer(s), establish
processes and procedures to bind policy and cede risk. Monitor reinsurance program.

Loss Control

Identify, minimize, or mitigate loss potential of a risk or exposure through the use of active monitoring and
managing the loss event. Includes use of consultative risk reduction techniques and overall risk analysis.

Compliance Strategy

Define a strategy and plan to comply with regulations established by regulatory bodies.

Regulatory and
Compliance Management

Evaluate and manage regulatory and compliance activities and initiatives to ensure Corporate alignment.
This includes approach to addressing any exceptions in a timely manner.

Regulatory Compliance

Active monitoring for compliance with existing and planned regulations e.g. OFAC, TRIA

Regulatory and Statutory

Reporting

Create reports showing activities and initiatives that demonstrate regulatory compliance by the Corporation
and satisfy all mandates

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Definitions Financial
Capital Strategy

Develop the strategies to maximize an organizations book value and return on equity, effectively allocate
capital resources, and ensure business solvency.

Capital Management

Evaluate corporate capital requirements, balance assets and liabilities, and manage the flow of capital.

Budget Management

Define operating units for budget management, develop budgeting processes, guidelines and tools, develop
and validate budgets, match budgets to actual results, and reconcile to financial plan.

Financial Reserve
Management

Assess and measure funds earmarked from retained earnings for future liabilities, including reserves for
unearned premiums, losses that have been incurred but not reported (IBNR), investment liabilities, and all
other expenses that are unrelated to claims.

Financial Reporting and

Metrics

Define financial information needs; develop financial reporting methods, metrics, tools, and standards; create,
validate and distribute timely and accurate financial information to internal and external stakeholders.
Reported information includes results of corporate financial activities, resulting profitability and financial
condition, for a specified period of time and projected future results.

Treasury Strategy

Develop the strategic approach to the collection, maintenance, management and disbursement of funds.
Define the cash flow and budget strategies.

Treasury & Cash

Management

Effectively manage cash to maintain adequate cash that flows in from financing, operations and investing, and
flows out from claims, expenses and investments.

Tax Management

Maintain an awareness of local and international tax regulations and develop tax policies that satisfy tax
obligations and minimize worldwide tax expenditures.

Billing

Prepare statements, including notification to relevant parties with amounts due.

Accounts Payable

Manage obligations to vendors and other parties for products, services and regulatory liabilities.

Payments

Transfer funds to another in exchange for products, services or as a reimbursement for money owed.

Receivables and
Collections

Manage receivables (money owed to a company by a customer or other party) and collect (the conversion of
any receivable into cash).

Accounting

Validate, reconcile, structure, generate, document and maintain the records of all of the financial statement
accounts for the business, resulting in comprehensive information contained within the books of record.

Investment Strategy

Develop a strategy to maximize the investment portfolio with sets of rules, behaviors, goals and procedures.

Investment Management

Assess, oversee and manage various securities and assets to meet specified investment goals.

Investment Execution

Purchase, sell and account for various securities and assets.

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11

Definitions Business and Enterprise

Service
Business Management

This capability provides the ability to define and manage the vision and direction that drive and define the
company. Key activities include development and communication of enterprise strategic plans, development
and refinement of enterprise organizational and capital structures, definition of strategy and planning
guidelines / targets / inter-relationships for individual business units, and coordination of planning across the
enterprise.

Human Resources

This capability provides the ability to manage the company's relationship with its employees given the context
of the company's mission and goals. Key activities include talent management, organizational development,
employee relations, recruiting, benefit administration, and payroll management.

Facility Management

This capability provides the ability to manage all aspects of acquiring, maintaining, and divesting property,
plant, and equipment.

Operations Management

This capability involves support for the ability to define and manage the operations of the enterprise. Key
activities include establishing performance targets, communicating performance expectations, establishing
change imperatives, resolving barriers to improvement, and measuring performance against said targets.

Legal

This capability involves support for the ability to provide legal direction and counsel to the organization in all
matters external to underwriting and claims concerns. It involves such activities as providing legal direction
and counsel to the organization's executives, resolving legal issues, managing outside attorneys, and
ensuring legal compliance with government regulations regarding specific activities or procedures.

IT

This capability provides the oversight and control of the use of automated systems in support of the
organization.

Public Relations

The capability provides the ability to manage the organizations relationship with the external environment.
Key activities include developing positive influence and goodwill in the local community, and coordinating all
press releases and media communications.

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