The Economical Insurance Group Selects ILOG JRules for its Next Generation Underwriting System

BRMS-based Solution Improves Speed to Market, Automates Decisioning and Reduces Costs

MOUNTAIN VIEW, Calif. and PARIS – October 11, 2005 – ILOG® (NASDAQ: ILOG; Euronext: ILO, ISIN: FR0004042364) today announced that The Economical Insurance Group (Economical), one of the largest property and casualty insurers in Canada with over $1.7 billion in premium volume and $3.3 billion in assets, has selected ILOG JRules™, for its new automated underwriting system that will handle both commercial and personal lines of business. ILOG JRules, a key offering in ILOG’s Business Rule Management System (BRMS) product line, is expected to improve decision-making by enabling faster turnaround times and reducing costs while ensuring consistency and accuracy in incoming policy requests.

The Group selected ILOG's BRMS to automate its highly complex underwriting process and to deliver greater accuracy, speed and transparency for such key functions as eligibility determination, risk assessment and regulatory compliance. In addition, ILOG’s BRMS will provide the combination of features needed to manage and grow Economical’s business. For example, ILOG’s BRMS provides a centralized business rule repository, a feature that Economical will use to centralize rule changes as insurance market conditions and policies change. With this, Economical’s business users – actuaries and business analysts – can change rules and policies pertaining to underwriting with minimal help from IT specialists. The repository also provides for greater consistency and transparency in how and when the business rules are enforced since the rules are centrally maintained in the rule repository and are easy to access and monitor.

The IT research community has underscored the need to automate processes and decisions as critical for success in the ever-changing insurance industry. In a report from Celent, titled “Business Rule Engines: Vendor Evaluations,” Senior Analyst Donald Light wrote, “Insurance is a decision business. Competitive success depends on making smarter decisions than the other guy. Traditionally insurers have relied on written procedures, training and hard-coded mainframe programs for consistency, and on actuaries, underwriters and adjusters to make the right decisions. But as change becomes more frequent and decisions more complex, insurers need a better solution.” Celent Senior Analyst Craig Weber added, “Claims and underwriting are the poster children for a BRMS.”

“Underwriting is a highly rules-driven process and by extending rule management capabilities to our actuaries and business analysts, Economical can better align its business strategies with IT objectives,” said John Martin, Chief Information Officer, The Economical Insurance Group. “We wanted to build a next-generation underwriting system that supported our goal of process efficiency, speed-to-market and higher pass-through rate whereby only exceptions or complex underwriting cases are routed to our underwriters. We built this system to achieve that goal.”

ILOG has consistently built on its history of product innovation to make ILOG JRules the industry’s leading business rule software. For the third year in a row, ILOG has been named to the leader quadrant of Gartner’s Magic Quadrant for Business Rule Engines and ILOG has twice been named the BRMS market leader by IT research firm IDC. ILOG’s BRMS customers in the Insurance industry include Metlife, St Paul Travelers, VSP, 21st Century Insurance, and Zurich along with many other leading Global 2000 companies and governments worldwide. In addition, since BRMS is becoming an essential complement to business process management (BPM) applications, ILOG has partnered with leading BPM solution providers to provide BRMS solutions to their customers. These providers include BEA, EMC Documentum, FileNet, Fujitsu, IBM, Oracle and Vitria.

About ILOG
ILOG delivers software and services that empower customers to make better decisions faster and manage change and complexity. Over 2,500 global corporations and more than 465 leading software vendors rely on ILOG's market-leading business rule management system (BRMS), optimization and visualization software components, to achieve dramatic returns on investment, create market-defining products and services, and sharpen their competitive edge. ILOG was founded in 1987 and employs more than 650 people worldwide. For more information, please visit www.ilog.com.

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