Our US market-leading financial modelling solution and actuarial projection system is now available in the UK. Already in use by a number of European clients, MG-ALFA®—Asset Liability Financial Analysis— has proven itself uniquely suitable for Solvency II and other local modelling requirements, including ALM, EEV/MCEV, pricing, and capital management.

MG-ALFA was developed as an asset-liability management (ALM) system specifically for the life insurance industry. It delivers exceptional calculation capabilities, blending ease of use with the advanced analytics, audit, and control functionality required to achieve Solvency II internal and standard model approval.

MG-ALFA is optimised from both a memory utilisation and processing speed perspective for large-scale modelling. More than 200,000 model points in 2GB RAM for period-by-period ALM projections are possible. Processing can be spread across cores within a machine as well as distributed across machines on a internal grid or dynamically provisioned cloud computing resources.

Other key features include:

• Built-in income statement and balance sheet structure facilitating model integrity through client added customisation automatically feeding into cash, income statement, and balance sheet reports
• Simple formula syntax which is consistent with actuarial specifications, is simple to learn and eliminates the need for specialist programming skills
• Inheritance structure which separates vendor supplied standard business logic and client customised logic facilitates code consistency across products and avoids duplication of business logic
• Flexible data model which allows for a single model to be used for (as examples) multiple plans, lines of business, legal entities, countries, or distribution channels using the hierarchy of the formula database and the varies-by input structure
• Built-in nested stochastic capabilities

MG-ALFA forms part of an integrated Milliman software and consulting offering. As Milliman’s internal consulting tool, it is constantly upgraded to be regulatory compliant, embedding Milliman's combined experience in actuarial systems and insurance.

Advanced cluster modelling

With actuarial models growing in complexity and with increased use of stochastic and nested stochastic approaches, running large models is time-consuming and unwieldy. Milliman has developed a new type of automated model compression process called 'cluster modelling'. Cluster modelling enables users to efficiently model millions of policies into significantly fewer—hundreds or thousands—model points. The process can accurately reproduce the results of the original seriatim model across a range of economic or experience scenarios and only requires a small number of calibration runs.

Expert design, expert support

Like all Milliman tools, MG-ALFA has been created and is continually refined and supported by our own in-house team of industry experts. Our experts provide thorough training to clients licensing the software and offer ongoing support throughout the licence period so that actuaries using the tool will get the most from each feature MG-ALFA offers.