Forum

Richard Adams: As an industry, insurance has been rather slow to embrace technology compared with others. There have been false dawns and failures, which, understandably, perpetuate scepticism among brokers. Peter, if I could ask you first of all why there is a need for imarket and what is wrong with the way that brokers have worked traditionally?

Peter Knowles: If you look at the commercial insurance market, it does not trade in a hugely different way to how it traded a couple of hundred years ago. Yes, we have some technology in there but the cost of trading in that market for everybody is just too high. And we are seeing evidence in the market that small brokers trading at the smaller end in the traditional way is just becoming uneconomic. So, a product like imarket, which - when it is fully up and running - has the potential to take out 30% of brokers' costs is actually critical for our industry.

Richard Adams: One of the things brokers are keen to know is how quickly products will be put on imarket.

Peter Knowles: Currently, it is possible to get comparative quotes for nine different classes of insurance via Xform, the structured data-capture form. And that can be accessed by anyone with a computer and an Internet Explorer 5.5 browser or better. In terms of integrated products, that is where brokers are able to put the data once it is on the system, we currently have one software house out there - Acturis - and shop products available from Allianz Cornhill.

Richard Adams: Kim, Norwich Union is making a significant investment in imarket, could you indicate which products it intends to add next?

Kim Kearney: We are going to go live with Shop, with Acturis in September and Software Solutions Partners in October, and hopefully others by year end. We are also looking for a launch of commercial combined by the end of the year and are planning to launch four products per software house by the end of 2006. What we have been doing to date is getting the basic infrastructure in place, making sure that the systems can talk to each other, testing the end-to-end connectivity and planning for a really aggressive roll-out of products next year.

Richard Adams: David, I think NIG has plans to introduce an imarket first by the end of the year?

David Grant: Yes it is our intention to make sure that all our products are eventually available through imarket. But what we want to bring very quickly is a motor-trade-quote facility that will be available to brokers via imarket.

Richard Adams: Peter, can you give us any indication about other insurers' intentions?

Peter Knowles: All the insurers are working hard to deliver products. It is difficult to be precise because we have seven software houses, seven insurers and at least nine products, so it is a monster grid to carry around in your head. But I would like to reassure people that every meeting we have with insurers is about how quickly products can be provided now the infrastructure is up there and proven.

Richard Adams: Was imarket introduced too early and what mistakes were made?

Peter Knowles: With hindsight, it is probably fair to say that expectations were raised to an inappropriate level. We have learnt from that and our philosophy now is not to announce something until it is actually delivered. I think it is also appropriate to mention that consumers - and I include brokers in this - are becoming more sophisticated, more and more demanding. So when it is possible to log on to do banking over the internet and to buy books, DVDs and CDs, for example, online very quickly and efficiently, then that experience is something that they want to see when they are trading in their business. And it is not unreasonable for them to expect that, we are just not there yet.

Richard Adams: In our first member poll, 62.5% of respondents think that the introduction of more insurers is the essential thing that needs to happen and 37.5% said the introduction of more products was key. Are there other insurers in the pipeline?

Peter Knowles: We are talking to a number of other insurers and are currently in advanced stages of discussion with three or four. I am just wondering at what point it becomes a 'cannot afford not to be in' for some of the other insurers.

Richard Adams: A question submitted from Benson insurance brokers asks: what is being done to make the imarket system attractive to brokers?

David Grant: If you wanted a single quotation from a single insurer then picking up the tele-phone remains a very effective solution. However, what imarket already offers is the ability to obtain comparative quotes from two, three or, in the case of the bigger panels, five or six insurers for particular products.

Kim Kearney: And when we get to software-house integration, then you will be keying that information into a system once and you will go straight through to imarket's insurers. So it won't be easier or more efficient to pick up the telephone in future

Richard Adams: What will become of existing channels such as extranets?

David Grant: Certain brokers deal with our corporation in some ways and others differently, depending on what suits their business. So imarket as a solution will have a cost-effective product to make it more efficient for the insurer and the broker and that will be good for both sides. But there will still be the need for people to operate in some of the more traditional ways, particularly with some of the more complicated risks where local support through offices is needed. So I think it is about providing that choice.

Richard Adams: Another forum member asks why you believe imarket will work?

Kim Kearney: I think it is going to work this time because technology is much more mature. More brokers have access to broadband and are much more used to using technology. We know the technology works, it is now just a case of getting the products on the system and refining it and making it more user-friendly. And brokers have got to find ways to reduce costs as well. So those are just some of the reasons that I think it is going to work in the future. But I think we should look to what happened with electronic data interchange and not expect it to suddenly take off next year. I think it is going to be 2007 before we start seeing real critical mass coming through it.

Richard Adams: EDI has been around for 10 years or so. Peter, do you think this (imarket) is going to take a similar length of time? Or do you think that EDI has been a good initiation for brokers when using technology and, hopefully for that and the reasons that Kim gives, this will actually come on stream a lot quicker?

Peter Knowles: I hope it doesn't take as long as EDI. I agree with Kim that critical mass is certainly not going to be next year but I would hope that we will see the signs towards the end of next year that it is building fast. I do think we have learnt a lot from the experience of EDI and lots of the people involved in imarket - both within Polaris and within the insurers - have been through EDI as well. Therefore I would hope it wouldn't be 10 years, I hope it will be a lot less than that.

David Grant: I think it is also true to say in terms of whether imarket will succeed, demand is already manifestly out there and we are certainly seeing that a larger part of package business will be transacted online. I have no doubt that demand is there. What imarket will allow us to do essentially is to step up efficiency and the way it is delivered, through technology.

Peter Knowles: I would urge the broker community to be open-minded about how they can use imarket in order to better serve their customers and make appropriate offerings available to their customers via their own websites, for example. One of the frustrations I have is that I do not receive as much feedback from brokers as I would like. My phone number is there, so please e-mail me or ring me with some feedback because only then can we truly start encouraging and building the usage.

Richard Adams: A question from Chris Welsh: does the reduced question-set really extract all the information that the broker needs to obtain in order to complete a proper fact find, or are we now starting to operate with multiple-sector data capture?

Peter Knowles: The Xform is, in some people's view, quite long. And we have recently completed some research comparing the questions that we ask to those questions that exist on insurer extranets. Typically, the imarket data capture has between 20% and 50% more questions on the form. The questions on the Xforms were put together by the six insurers, working with their underwriters. So what we put up there is what the insurers have asked us to. They are kept under constant review and, if there is a concern that we are not capturing something that we should, we would look to add to it. We see the balance that we must not make them too long and unwieldy as this could be a reason not to use them.

Richard Adams: So are you hoping to refine it and is this a continual process?

Peter Knowles: Yes, this issue was raised at the last intermediary advisory forum, which is our panel of brokers who provide us with feedback. As a result of that, we have done some customer research looking at it and at the extranets of insurers. Our initial findings are that we can make some improvements but, in order to meet the needs of the comparative use of the forms, then we need to capture all the data items that each of the insurers require.

Richard Adams: Do you see the influence of the Financial Services Authority helping to streamline process and achieve more commonality between insurers?

Peter Knowles: Yes, I think so. We are a conduit between brokers and insurers. And it is up to the insurer at one end and the broker at the other to ensure they are fully compliant in everything that they do. Anywhere that we can help that process, anywhere that we can help transparency, provide audit trails, provide contacts as to documentation and trusteeship - we will do that. But we are very much driven by how the insurers and the brokers want to approach that.