- Where Insurance & Technology Meet

Broker Connectivity Getting Active: Will Results Follow This Time?

There’s an old insurance sales motivator axiom that says, “You can’t control results, but you can control activity, and activity produces results.” There has been some real activity in Broker Connectivity of late — including a continuing industry effort and a large acquisition by a major player. Our question to you: Will this increase in activity produce real results in the Broker Connectivity space at long last?

eDoc Gaining Traction

The winner in the Insurer category for the 2012 Technology Award (ICTA) was SGI Canada for the pioneering work implementing standards (now known ad the CSIO eDoc Standard) for downloading broker copies of policy declaration pages and broker memos as part of their daily EDI download of standard transactions.   The insurer shared the ICTA also included Josslin Insurance Brokers, Zycomp Systems, and MASTERCOM.

Since then, eDoc has gained traction in Canada: most of the major Broker System Vendors, and a growing list of insurers supporti the standard.  However, implementation has not caught up.  At the 2013 Technology Conference (ICTC2013),  ORBiT reported on survey of brokers which found that while eDoc format is preferred by brokers for delivery of personal lines dec pages, the vast majority of respondents still receive these in some other manner.

Competition in Policy Change

The Insurance Brokers Association of Canada(IBAC) has set a priority on the implementation of standards based policy change transactions and has provided a definition of the acceptable solution: “the ability to concurrently update a broker management system and an Insurer system by exchanging standard, non proprietary messages based on, and strictly adhering to, the CSIO XML language”.  Several insurers and vendors have come forward with solutions that match these criteria.

  • In February 2013, Canadian insurer SGI Canada and Brovada, a software provider and integrator, announced the launch of a solution using Brovada’s NexExchange product.
  • At ICTC2013, Canadian insurer, Unica,  took the  2013 ICTA Award in the Insurer category for the implementation of policy change developed by technology suppliers Iter8 and Keal.

Brokers and insurers agree that policy change will save time and money in transactions that are critical for policy service, and will allow independents to more effectively compete with direct writers (see CITopBroker’s article Real-Time Real Deal?).  However, the benefits only accrue when there is a critical mass of implementation within each segment – insurers, brokers, and technology providers.

And there’s the rub.  If a brokerage has implemented the technology, but most its insurers haven’t, there is no common workflow, and little benefit.  If an insurer has implemented the process, but only a handful of brokers have, it has duplicate processes. If less than a critical mass of technology providers come to the table, there is no point in the practitioners moving forward.  This could take a while.

And this is where a recent announcement becomes interesting.

Applied Systems Acquires IVANS P&C Division

One of the largest BMS vendors in Canada and the US is Applied Systems.  It has strong commitments to standards-based connectivity,  using CSIO Standards in Canada and ACORD Standards in the US. (The two standards are virtually identical for the majority of transactions.  eDoc being one exception.)

IVANS started its organizational life (early 1980s) as a Value-Added Network, dedicated to supporting standards-based agent/broker connectivity in the US.  Shortly thereafter, it determined that the standards-based traffic would be insufficient to support its operational costs, and opened its doors to any activity in the insurance community, drawn large functionally (including life and health) and geographically (including Canada, where it had  a working relationship with CSIO and marketed its services as ICEnet).  As a result, IVANS developed significant skills in integration and network support.

Applied Systems recently announced that it was purchasing the P&C division of IVANS and retaining much of its structure and personnel.  The two organizations have a long history of working together, so on the surface, there should be no dramatic changes in the short term.  However, it is clear that the two organizations will be focusing on broker connectivity.  Jim Ochiltree served as president of IVANS property/casualty division will continue in this role in separate business division of Applied Systems. He is quoted in Business Insurance saying the new relationship will “further our mission of supporting the industry through innovation in our data exchange and carrier interface technology solutions.”

Could this innovation include a specific focus on integration of disparate processes in Canada, helping standard implementations mature?  Just asking.

What Do You Think?

Is this activity going to break trough the roadblocks on the road to broker connectivity?  If so (or not) what does this mean for you?

Get active… leave your comments below!