IBIPs Designer

The solution enables: 

• Facilitating the design of new products by allowing multiple simulations in terms of variations in the product’s technical characteristics and underlying investment options. 

• Automating and recording the product construction process, capturing the transition from concept to fully defined product. 

• Automating the monitoring of products, both on and off the market, by periodically recalculating all necessary indicators. 

Yes. The solution has been designed to meet the product testing requirements set out in the IDD (Insurance Distribution Directive 2016/97/EU), IVASS Regulation No. 45/2020, and the IVASS Market Letter of 27 March 2024. 

In particular, IBIPs Designer supports the Product Test required by Article 8 of IVASS Regulation No. 45/2020, allowing a structured assessment of the product’s expected costs and returns under both expected market scenarios and adverse conditions. In integration with Fairmat for KIDs, the solution enables periodic monitoring of the entire product portfolio, in line with Article 9 of the same Regulation, going beyond control limited to newly issued products. 

With regard to the expectations set out by IVASS in the market letter of 27 March 2024, IBIPs Designer: 

• Allows the testing and recording the results of analyses performed by the company at product launch and during periodic monitoring (Expectation No. 9). 

• Supports companies in verifying the Target Market (Expectation No. 5), simplifying its definition and ensuring alignment between the intended Target Market and the positive Target Market. 

• Enables profitability analyses, evaluating costs and returns from the investor’s perspective, allowing verification across different customer segment (Expectation No. 10). 

• Supports analyses both on individual investment options and on their combinations, representing the possibilities offered to the Target Market (Expectations No. 7 and No. 10). The indicators calculated by IBIPs Designer include the following: 

1. Expected policyholder return, net of costs, under both expected and adverse market scenarios (Expectation No. 11.1.a). 

1. Ratio of surrender value to total premiums paid (Expectation No. 11.1.b). 

1. Expected reduction of the annual return due to all costs charged to the contract (Expectation No. 11.1.c). 

1. Ratio between the total costs incurred and premiums paid, and between total costs incurred and the benefit paid to the policyholder (Expectation No. 11.1.d). 

1. Ratio of entry costs to total costs incurred (Expectation No. 11.1.e). 

1. The point in time when the surrender value equals the premiums paid by the policyholder (break-even point) (Expectation No. 11.1.f). 

1. Minimum return of the underlying asset required to reach the break-even point at the RHP (Expectation No. 11.1.g). 

1. Ratio of the benefit paid if the insured event occurs to the total premiums paid (Expectation No. 11.1.h). 

Among the indicators in Expectation 11, IBIPs Designer does not calculate the indicator listed under Expectation No. 11.1.i, as it depends on specific company assumptions. 

• All the indicators listed above, as well as all analyses available in the solution, can be applied consistently to both newly launched products and products under periodic monitoring (Expectation No. 14). 

Additionally, the reports generated by IBIPs Designer facilitate the involvement of Key Functions and Governance Bodies in the Product Oversight and Governance (POG) process, ensuring traceability, proper documentation, and structured decision-making support. 

Yes. IBIPs Designer is integrated with the Fairmat solutions Fairmat for KIDs and OpenKID Vita, ensuring operational continuity and methodological consistency across the different stages of the product lifecycle while streamlining user activities. 

• IBIPs Designer is available within the Fairmat Platform, fully integrated with Fairmat for KID. Tested product prototypes can be easily transferred to official products by recording the “Approval” operation in the system. It is also possible to copy an official product into the Testing environment to perform modifications, stress tests, and variations without affecting the original product. All analyses available in IBIPs Designer can also be performed on products already available in Fairmat for KIDs, enabling periodic monitoring of relevant KPIs. 

• In combination with OpenKID Vita, IBIPs Designer allows comparing indicators of the product under testing with those of life insurance products available on the market. The benchmarking analysis can also include custom indicators such as “Value for Money,” using the Scoring Profiles defined by the company in OpenKID Vita. 

The first step is to define the prototype the company wishes to test. IBIPs Designer, integrated within Fairmat Platform, allows the company to build a new product from scratch or inherit information from an existing product without affecting the original product. 

Once the prototype is defined, all analyses available in the solution can be performed, enabling the calculation of: 

• All KPIs required for KID preparation, along with additional indicators on product costs and performance, under both surrender scenarios and insured events, for all years from subscription to the recommended holding period. 

• Profitability from the customer’s perspective, measuring the expected product return for the Target Market, taking into account major events affecting customer (death, full or partial surrender) from subscription until the recommended holding period. Calculations incorporate company assumptions regarding surrender and death probabilities. 

• Break-even time, the period required for the product to fully recover premiums paid in case of surrender, according to a percentile selectable by the company. 

• The product’s ability to meet the needs of a specific Target Market. The model evaluates key drivers based on the quality of key drivers: Liquidity, Protection from biometric risk, Cost-effectiveness, Protection from financial risk, Flexibility, Potential Return, and Sustainability. Each driver is evaluated through configurable policies and then synthesized into an overall indicator reflecting alignment with Target Market. 

• Ability to define custom policies that align analysis results with ESMA categories, to systematically assess which needs are effectively met by the various investment options. 

IBIPs Designer is fully integrated within Fairmat Platform and allows monitoring the value of launched products directly from those already available in the system. 

All analyses used during ex-ante testing can also be applied to products on the market, ensuring methodological consistency across the entire lifecycle. Reports are generated consistently and in a structured manner, facilitating comparison over time. 

Analyses can be repeated annually or according to the frequency defined by the company, storing results and producing documented evidence to support the Product Oversight and Governance (POG) process. 

Yes. IBIPs Designer allows including historical returns in the evaluations, analyzing product generations over time. See also the question: “Is it possible to evaluate products for policyholders other than those represented in the KID?” 

Yes. IBIPs Designer allows storing all tests performed over time within the same prototype, ensuring full traceability of analyses and their evolution. Results, for both products under testing and those being monitored, can be exported in Excel/CSV format, enabling the creation of internal reports to support the company’s POG process. 

IBIPs Designer allows the calculation of all relevant KPIs using various financial modeling methodologies, adaptable to both regulatory requirements and the company’s strategic analyses. 

Specifically, it is possible to: 

• Apply the methodology provided by Delegated Regulation (EU) 2021/2268 (PRIIPs Regulation) used for KID preparation, enabling verification of the metrics to be reported in the mandatory pre-contractual documentation for the client. 

• Performe market stress tests. It is possible to vary the depth of the historical series used as input, apply financial shocks to trends and/or historical volatility of the underlying assets, and adjust technical assumptions that define the portfolio disaggregation logic. This approach allows assessing the product’s robustness under adverse or alternative scenarios relative to historical data. 

• Define the predefined return or growth target for different underlying assets. For testing purposes, this allows incorporating the company’s forward-looking views, anticipating market trend changes not reflected in historical performance. 

Yes. IBIPs Designer allows analyzing the same product considering policyholder cohorts different from the standard used for KID documentation. It is possible to: 

• Assess the product by specifying the premiums paid, even if different from the standard amounts required in the KID, highlighting the cost impact and detailing policyholder ageswith differing benefits. 

• Monitor the product’s value by specifying the policy year for different typical policyholders, including historical returns for the years since subscription up to the testing date. 

This approach provides a representation that is better aligned with the commercial reality and the actual composition of the client portfolio.