Let’s Talk Data Exchange

Last month, Canadian Underwriter associate editor Vanessa Mariga wrote our cover story, which was supposed to be a basic overview of the state of technology in the Canadian insurance industry.

However, what she discovered is that the attitudes about, politics around and objectives for technology in Canada’s insurance industry are anything but “basic.”

Vanessa’s piece exposed an evident lack of communication between independent brokers, insurance carriers and third-party technology vendors around the issue of what independent brokers want or (can) expect from technology in the future.

Associations representing independent brokers say their members would benefit from a single-entry, multiple-company interface (SEMCI) tech solution. Such a solution, typically associated with Web portals, would allow broker management systems the capability to access policy data from multiple companies without having to re-key data for each and every carrier. This, in turn, would allow independent brokers to access carriers more quickly and efficiently, giving them an edge against their direct or multi-channel competitors.

Technology vendors say they have all kinds of toys available for independent brokers, featuring real-time quote capabilities and other projects that promise to make the electronic interface between brokers and individual carriers easier, faster and more efficient. All the brokers have to do is ask for this technology, they say.

Insurance companies echo some vendors in saying that standards, as opposed to all-industry-encompassing SEMCI Web portals, are the best means for simplifying data exchange between brokers and insurance companies. According to this argument, as long as everyone in the industry is following the same standards for inputting and uploading data from the broker management system to the carrier’s policy systems, then better communications between the brokers and the insurers will be the inevitable byproduct.

The push-pull in all of these solutions is between two fundamentally different ways of doing business. For example, the independent brokers appear to be advocating a “universal” tech solution, which, in theory, would link all brokers to all carriers with a minimum of re-keying or re-coding data to be exchanged.

On the other hand, there is a case to be made — and both the vendors and insurers seem to be making it — for using heterogeneous technological solutions to support disparate business objectives. This approach, insurers and vendors argue, better recognizes the reality and value of competitive advantages and differences between carriers (and between tech vendors).

This whole discussion seems to be based around the wants and needs of the independent brokers, because all parties are touting new technology as a means to facilitate the brokers’ business. So then, we come to the key question underlying the industry’s discussion around tech issues: What do brokers want and/or expect from technology in the future?

The only way to know the answer to this question is to ask the brokers. This could be done by conducting a broad national survey, focus groups, etc. Once the answers are collated, brokers will have information available to anchor what should be a future industry-wide discussion on the topic. We’re asserting here the need for some kind of future technology summit involving all stakeholders in this issue — insurers, brokers and technology vendors.

The focus of the summit would be very specific. It would be a forum for communicating the results of the putative national brokers’ survey — indicating precisely what brokers seem to want and need from technology in the next few years going forward.

Such a summit would provide an opportunity for all parties to discuss practical ways to meet the brokers’ future objectives, as identified in the survey. If nothing else, the forum would provide an opportunity for the players in this issue to understand what each other wants, needs and is able to deliver.

Clearly, that discussion is not happening in any formal form right now; instead, all of the stakeholders appear to be in the same boat, each rowing in different directions. It’s time to promote a little understanding between the parties, which can only come from a clear identification of what brokers, insurers and tech vendors all want to achieve looking forward five or 10 years from now.

That future is indeed now: If the industry doesn’t start planning right now for how it wants to operate in the future, it won’t be any further ahead than where it is now.