Hanover RE
nicetec insightpro - Hannover Re automates intra-group service billing
It transacts all lines of non-life and life/health reinsurance and is represented on all continents with around 3,200 employees. Founded in 1966, the Hannover Re Group today comprises more than 100 subsidiaries, branches and representative offices worldwide.
Efficient transfer pricing relieves the tax department
Natural disasters are increasing worldwide - and so is the associated damage.
According to the United Nations, the global cost of the consequences of hurricanes, fires, earthquakes, floods, etc. amounted to 2.9 trillion dollars between 1997 and 2017.
Against this backdrop, reinsurers are becoming increasingly important.
They cover the risks of primary insurers and thus ensure that companies do not run into difficulties in the event of isolated, particularly high losses.
Somehow different and successful
As one of the largest reinsurers in the world, Hannover Re is an experienced player in this business.
The company slogan reveals an important secret of Hannover Re's success: the claim "somewhat different" stands above all for the fast, flexible and undogmatic business approach.
It has enabled the financial services provider from Lower Saxony to develop into a well-diversified, globally active and highly profitable reinsurer since its foundation as a stock corporation for marine and reinsurance in 1966.
As a multinational company, the group must not only take into account German tax law, but also local foreign tax regulations and international guidelines such as the guidelines of the Organization for Economic Cooperation and Development (OECD): For OECD-compliant group accounting, it is not only performance-related expenses such as working hours and travel expenses that need to be determined and allocated.
Fixed costs such as license fees, rent or depreciation can also be included in the allocation.
Manually compiling the necessary data from the individual source systems, consolidating it and distributing it appropriately to the individual Group companies is extremely time-consuming and inefficient.
High workload due to manual processes
While billing results must be saved as an invoice anyway as part of the accounting process, this does not automatically apply to the calculation bases. If there are later internal or external queries about individual details, answering them can be time-consuming.
Against this backdrop, Hannover Re decided to modernize its service billing. The aim was to set up a central data management system with standardized and automated billing processes and to reduce manual data processing as far as reasonably possible.
The reinsurer's requirements for a corresponding software solution were high. The contract was awarded to the insighTPro solution from nicetec: this software brings together relevant data relating to intra-group service allocations in a system-supported manner and creates the basis for efficient and user-friendly cost allocation.
Efficient project phase
The go-ahead for insighTPro implementation was given at the beginning of 2018. During both the detailed technical conception and the implementation phase, it became clear that the conceptual and procedural realignment of the group-wide service billing entailed additional requirements that were not available "out of the box". nicetec was a competent partner here, flexibly adapting the standard software in the key areas.
Additional challenges arose from the automatic data supply. On the one hand, the billing information came from a large number of different source systems, and on the other hand, solutions had to be found for heterogeneous and manual data processing. Here, nicetec was able to provide a convincing interim solution for the connection of source systems at short notice. In addition to automated interfaces, it is still technically possible to import data on the basis of established data supplies via manual uploads.
Throughout the entire project phase, the expertise of internal employees and external consultants was used in a solution-oriented manner - the agile working method in particular was the basis for efficient target achievement. In addition, nicetec significantly supported the smooth go-live with its unbureaucratic support, enabling insighTPro to go live at the beginning of 2019.
Established line operation
Today, the software enables efficient and transparent cross-border service billing at Hannover Re. All relevant cost data is automatically transferred from the SAP system. While the ongoing provision of services is usually calculated via key-based distributions to the international branches, individual items can be billed easily both by manual entry and by Excel upload.
Individual invoice items are combined by the system, written to a PDF document and automatically sent to the invoice recipient by email. The generation of a posting for outgoing invoices in the SAP system is also fully automated. This not only makes group-wide service billing more transparent, but also speeds it up despite the increasing number of billing issues.
In addition to efficient intercompany billing, the reinsurer also maps its internal project cost accounting using the nicetec solution. Identical documentation and information is also provided for this settlement - with the formal difference that internal settlement documents are created and provided instead of invoices to international locations.
Maximum transparency
The international locations also benefit directly from the increased transparency. Standardized invoice documents and a centralized process increase understanding and traceability both for the invoice content in detail and for the management perspective in terms of an overall view. In addition, associated documents can be accessed independently by local contacts at any time via insighTPro's web-based self-service portal, making the need for individual file storage obsolete.
The same web-based access also enables all service providers to provide billing-relevant information simply and in a standardized form. This means that all calculation bases and postings are centralized and fully traceable. This means that internal and external queries can be answered reliably, quickly and accurately at any time.
With a premium volume of over EUR 22 billion, Hannover Re is the third-largest reinsurer in the world. It transacts all lines of non-life and life/health reinsurance and is represented on all continents with around 3,200 employees. Founded in 1966, the Hannover Re Group today comprises more than 100 subsidiaries, branches and representative offices worldwide.
