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Case study report

By :
Krishna Nandan kumar
USN:2SD12CS044
Under guidance of:
Prof.Vandana Bhat

Problem definition:
ABC Auto Insurance is under immense pressure from competitors due
to reduce Auto Insurance prices and high risk underwriting. ABC
Company has huge data resources from business operation, however,
it is difficult to get required information in timely manner. ABC
Company has to make major steps for informed decision making and
important data analysis.

Objective
ABC Company has an OLTP database which keeps records on motor
vehicle insurance information. This database contains detailed
information in respect of drivers, vehicle and claim information.
Current database model has been designed for fast data entry and is
sufficient for individual clients specific information as well as fast
transaction processing. Company critically needs to make
comprehensive analysis like identification of contracts with a high loss
ratio and low overall customer value.
Appropriate actions needed to be taken with high risk customers, such as
premium adjustment, loss prevention measures and in some cases
contract cancellations and reduce gross claim expenditures.
By making evidenced based management and informed decision,
company will focus on profitable customers by lowering their premiums
and overcoming competitive pressure. It will help company make better
risk management and overall profitability for the company. ABC
Company is in urgent need to utilize the existing data resources
efficiently for better risk management and obtain competitive advantage
in Auto Insurance Industry.

Solution
ABC Company has decided to implement a Data Warehouse to leverage its data
resources. ABC Company needs to reorganize the existing process of
information delivery and to establish one single, unified and integrated data
warehouse. A data warehouse is an integrated subject oriented, time-variant,
non-volatile database that provides support for decision making.
In order to support decision making ABC Company decided to reorganize the
data into Star Schema in Data warehouse. In effect, the star schema creates near
equivalent of multidimensional database schema from the existing OLTP
relational database . It will help in advance data analysis for Risk management
and overcoming competitive pressure.

Structure of Star Schema


Star schema yield an easily implemented model for multidimensional data
analysis while still preserving the relational structure on which the operation
database is built. The basic star schema has four components: facts, dimensions,
attributes and attributes hierarchies. The STAR schema would most likely be a
read-only database due to the widespread redundancy introduced into the
model.

Fact Table
ABC Company has a factual data in Claim Information such as date, location,
type of accident, cause of accident, liability, recovery cost. Fact tables contain
the quantitative data or factual data about a business. This information is
numerical, additive measurements and can consist of many columns and
millions or billions of rows.

Dimensions
Claim Information facts can be analyzed by dimensions such as Driver,
Location, Time, and Automotive. Dimension tables are usually smaller and hold
descriptive data that reflects the dimensions.

Attributes
For example Driver name, Driver ID, gender, age group, race, and other
attributes. Some of these attributes might relate to each other hierarchically.

Attribute Hierarchies
Provide top down data Aggregation, Drill down or roll up data analysis. For
example in time dimension there are Attribute hierarchies such as day, week,
month, quarter, and year. When decision maker want to see company yearly
claim information, then they are using year hierarchy level, they can further drill
down to quarter level sales quantity, as per there needs. Same as in Location
dimension is data can be analyzed by Country, Region, Province City and town.

Benefits of Data warehouse to ABC Company


By organizing the ABC Company data around star scheme company can
analyze information like what customers are high risk and what group of
customers is profitable. What cities have more accidents ratios and what time of
the year accident happens? What habit of drivers is may be considered high
risk? What vehicles are considered low risk and so on.

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