The Blufftop Framework

The Blufftop Framework.  Cash flow projection models are already in wide use within insurance companies, and currently emerging regulatory and accounting requirements will turn their use into a staple of actuarial practice.  The "Blufftop Framework" refers to a component-based design for open models, and to a model-development platform based on that design.  The design is based on Strommen's 1997 NAAJ paper "An Object-Oriented Design for Dynamic Simulation Models".

Blufftop LLC has used the Blufftop Framework for research projects while steadily polishing the user interface, which we refer to as the Modeler's Workbench.  Version 1.0 was released in September 2017 and includes all the features listed in the sidebar at the right.

In its first release the Blufftop Framework provides a model shell in which the user must define the insurance product and required assumptions.   This blank-sheet-of-paper approach has some advantages:

• It can shorten the learning curve dramatically compared to competing model development platforms with their long lists of product options and features that the user must understand. 
• It can alleviate the feeling of using a black box.  
• It provides complete flexibility to model any possible product and any accounting treatment.  This framework could be adapted to model liabilities of a bank, a property/casualty insurer, a continuing care retirement facility, a pension plan, or any collection of financial liabilities that is managed in connection with a portfolio of invested assets.

A disadvantage is that it is a burden to start from a blank sheet of paper when specifying an insurance product, its data requirements, and the calculations that define policy values.   Efforts towards releases of the Blufftop Framework that include insurance product templates to start from have been abandoned.

If you want to know more about the Blufftop Framework, let us know of your interest by sending an email to support@blufftop.com.  If you wish, you may download a user manual for the Modeler's Workbench, a model development platform using the Blufftop Framework by clicking here or read more about the Workbench here.

Features of the Modeler's Workbench

• A model development environment that includes integrated and ready-made modules for scenario generation, management of tables and assumptions, investment simulation, output management and flexible report generation.
  
• A data-driven product definition facility that includes a source code generator to write much program code for a product simulation module, leaving blanks to fill in formulas for contract values.
  
• Implementation of the "one-model" concept, facilitating support of multiple actuarial functions (valuation, cash flow testing, corporate projections, etc.) using the same interface to the product simulation module for a contract form. 
  
• A facility to trace dependencies among the variables and formulas defined by the user.
  
• Direct use of the C# language and the Microsoft .NET platform.  This not only provides complete flexibility to do any kind of customization, but allows models developed using the Blufftop Framework to be packaged for support by IT staff using a tool familiar to them: Microsoft Visual Studio.
  
• A unique internal design that enables faster calculation and reduced memory requirements compared to some commercial models.