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Prudential Insurance Creates Reserve Calculation Warehouse with DB2 Universal Database

  Product Review published in DM Review Magazine
July 1999 Issue
  By Donald Canning
IBM Corporation
Review of: DB2 Universal Database from IBM Corporation

BACKGROUND: The Prudential Insurance Company of America is the largest life insurance company in the United States and one of the largest diversified financial institutions in the world. It is a leader in the global financial services industry, providing insurance, investments, real estate, relocation, securities, banking and other protection and investment services in more than 20 different countries to approximately 40 million customers. The company currently employs 78,000 people with approximately $279 billion in assets.

PLATFORMS: Prudential runs DB2 Universal Database Enterprise-Extended Edition (EEE) on RS/6000 SP (AIX) platform.

PROBLEM SOLVED: Prudential calculates and reports reserves for over 18 million life insurance policies as part of its financial statements. In the past, this reporting was done on a quarterly basis. But when the company wanted to move to monthly reporting, it was difficult to meet deadlines due to the amount of time and resources it took to perform these reserve calculations. To speed calculations, Prudential needed to bring the actuaries closer to the information they needed. It consolidated the information into a data warehouse based on DB2 Universal Database Enterprise- Extended Edition. The warehouse reduced calculation time from 30 days to just five. The warehouse allows Prudential's actuaries to look at histories and analyze the calculations and assumptions to make sure they are doing the best for customers and the corporation.

PRODUCT FUNCTIONALITY: The reserve calculation application is not the first data warehouse implemented at Prudential, but it is the first on DB2 Universal Database (UDB), a precedent that will serve as a yardstick for future data warehousing projects. Prudential is using DB2 UDB to set a standard for massively parallel processing within the company and will eventually begin normalizing data from other databases, determine where there are overlaps and build a large warehouse for enterprise- wide data that provides multiple views of the information.

STRENGTHS: Scalability - IBM's ability to grow a data warehouse to meet future massive storage needs without compromising performance gives Prudential the flexibility to leverage the existing infrastructure for potential, large-scale data requirements. One vendor - integrating the many components of a data warehouse is made easier when they all originate from the same vendor.

WEAKNESSES: IBM's strategy for DB2 UDB is to maintain one code line on all supported platforms (e.g., MVS, UNIX and Windows NT). Today we have DB2 UDB for Windows NT and UNIX, but not for MVS. Until IBM establishes its single code-line, Prudential is unable to migrate any of its DB2 UDB databases to an MVS region without first having to "downgrade" the code.

SELECTION CRITERIA: Prudential selected IBM after evaluating several vendors. The company needed to build a very large data warehouse on a massively parallel processing platform. IBM DB2 Universal Database's open architecture, massively parallel processing capability and scalability were the driving forces behind the decision. The reserve calculation database is currently three terabytes, and Prudential plans for up to 17 terabytes of storage space on its data warehouse server.

DELIVERABLES: Prudential called upon IBM to help identify a scalable, cost-effective solution that was competitively priced. The DB2 Universal Database Enterprise-Extended Edition (EEE) running on the RS/6000 SP (AIX) platform provides the ideal solution to meet Prudential's performance and capacity requirements. In addition, building a data warehouse has reduced the number of people involved in gathering the information for the reserve calculations. The data warehouse has been in production for only seven months. With the cost and productivity benefits it is accruing, Prudential projects the solution will easily pay for itself in less than two years.

VENDOR SUPPORT: IBM Global Services was invaluable in getting the system installed and running. Migration to Prudential's new system was smooth, mostly due to the excellent technical support the company received from IBM.

DOCUMENTATION: We did not use the documentation due to technical, on-site support.


For more information on related topics visit the following related portals...
DW Engines, Exploration Warehouse.

Donald Canning, vice president of the Prudential Insurance Company of America.

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