Technology Support for Electronic Placing “The best way to predict the future is to invent it”

Technology Support for Electronic Placing “The best way to predict the future is to invent it” Alan Kay – President, Viewpoints Research Institute Peter Holdstock, LMA, and Adam Stafford, Lloyd’s IT Club, November 2007 Peter Holdstock

Agenda • Introduction and Background • Placing technology environment map • LMA role in technology • The Lloyd’s perspective Peter Holdstock

A Short History • Electronic Placing is not new. • Individual initiatives - Broker portals, emails. • Market initiatives - EPS, Wise, WIN,Ri3K, eReinsure, Kinnect • Group initiatives – G6 Peer-to-Peer • a tentative step into standardisation. • skinny data set • one-way messaging • varying levels of document and data integration • Post G6 • growing functionality (two-way, multi-section risks) • increasing emphasis on direct messaging for STP • other initiatives point towards direct messaging Peter Holdstock

Moderate Simple Complex Negotiation Electronic Face to Face Face to Face, Telephone, Electronic Data Exchange What is electronic placing?

Suppliers / Vendors Suppliers / Vendors Roadmap Participants Environment Map Environment Map Technology Technology Benefits Electronic Placing Components Barriers Threats Standards Legal Aspects Process Data and Documents Evidence of Cover Interchange Agreement Peter Holdstock

Electronic Placing Environment Map Core Systems Document Repository Desktop Services Workflow Portal Market Repositories Market Repositories Browser Trading Platform Hosted full trading platform Controls process and data Trading Platform Hosted full trading platform Controls process and data Notifications Notifications Email Trading Partners Submission / binding Messaging Hub Outsourced connectivity and message management Gateway P2P Message Electronic Forms Hosted data entry and message creation Portal Browser Peter Holdstock

Electronic Placing Environment Map Core Systems Document Repository Desktop Services Workflow Portal Market Repositories Browser Trading Platform Hosted full trading platform Controls process and data Notifications Notifications Email Trading Partners Submission / binding Messaging Hub Outsourced connectivity and message management Gateway P2P Message Electronic Forms Hosted data entry and message creation Browser Peter Holdstock

Trading Platform • Definition • A web-based application offering users secure access to a trading environment which provides workflow and data management functionality via the internet. • Primary Function • Secure on-line trading. • Additional Services • Structured ACORD-compliant message exchange. • Electronic links to market repositories. • Electronic links to market services. Peter Holdstock

Trading Platform • How does it work • Brokers and Underwriters undertake the placing process on-line by logging on to the platform • May provide ability for Brokers and Underwriters to trade using their own internal workflow using messaging. • Process and data managed by the Trading Platform. • May provide links to external information and services • Examples Ri3K, eReinsure Peter Holdstock

Trading Platform Core Systems Document Repository Desktop Services Workflow Messaging Hub Gateway Market Document Repositories Another Trading Platform Trading Partners Trading Platform Hosted full trading platform Controls process and data Notifications Email Notifications Browser Peter Holdstock

Gateway • Definition • A software product that acts as a front door to the organisation, allowing business messages and documents to be sent and received by the company, using ACORD Web Services. • Primary Function • Data and document exchange. • Sending and receiving ACORD standard placing messages. • Shredding incoming XML messages • Maintenance of partner connectivity, and ACORD upgrades. • Additional Services • Audit log of messages. • Simple relational database and document repository. • Error management functionality. • Business statistics. Peter Holdstock

Gateway • How does it work • Links organisation to trading partners over the internet. • Direct messaging capability consists of two elements, data (RLC) and documents (DRI). • Receives and validates incoming and outgoing messages and manages communications protocols. • Synchronises data and documents when they apply to a single business message. • Examples Atos (WritePlace), IBM (Insurer Messaging Network), Perspective Technologies (onMessage), Trace Isys (TMMS), TriSystems InfoBahn (Universal Messaging Gateway), WebConnectivity (EnabledB2B, EnabledR2R) Peter Holdstock

Messaging Hub • Definition • A web-based application offering users the ability to route messages between trading partners. • Primary Function • Outsourced connectivity configuration. • Secure delivery of ACORD RLC and DRI messages. • Maintenance of partner connectivity, and ACORD upgrades. • Additional Services • Message validation. • Control features to manage partners gateway downtime. • Electronic links to market repositories. Peter Holdstock

Messaging Hub • How does it work • Used to route XML messages and supporting documents between trading parties. Message validation may or may not be provided. • Examples Atos (WritePlace), Catex, IBM (Insurer Messaging Network), Kewill, SSP (Nexus), The Insurance Workplace. Peter Holdstock

Electronic Forms • Definition • An easy-to-use, dynamic front-end to business process. • Primary Function • Used to help organisations quickly participate in electronic placing without incurring major IT development expense. • Provides a structured input form for a specific process. • Converts to either an email or structure data message. • Additional Services • Data validation. • Document production. Peter Holdstock

Electronic Forms • How does it work • Generally used in combination with a hosted gateway. • Examples Atos (WritePlace), Exari, IBM (eForm), The Insurance Workplace, TriSystems InfoBahn (Universal Messaging Gateway), WebConnectivity (Easy Placement, Starter Kit) Peter Holdstock

Vendors Landscape Analysis Examples of the technology choices Internal infrastructure Shared infrastructure Placing data and documents ACORD standard RLC/DRI messages Peter Holdstock Resource: Electronic Placing Landscape v1.3

Component Combinations • Vendors sell products that combine components. E.g. Gateway and Electronic Forms. • Brokers and Carriers choose combinations to suit organisation uniqueness. • The market will not settle on a one-size-fits-all solution in the short term. Peter Holdstock

Fully-integrated message-enabled organisation Core Systems Document Repository Desktop Services Workflow Market Repositories Trading Platform Hosted full trading platform Controls process and data Notifications Trading Partners Messaging Hub Outsourced connectivity and message management Gateway P2P Message Data and Documents fully integrated The ideal architecture for maximum benefit realisation. Allows single desktop for all trading activity. Full electronic exchange of data and documents. Peter Holdstock

Platform/hub-enabled organisation Core Systems Document Repository Desktop Services Workflow Market Repositories Browser Trading Platform Hosted full trading platform Controls process and data Notifications Notifications Email Trading Partners Submission / binding Messaging Hub Outsourced connectivity and message management Notifications Electronic Forms Hosted data entry and message creation Browser Electronic trading using electronic forms and trading platforms. No integration with core systems.Cheaper and faster to implement but does not allow full benefit realisation. Peter Holdstock

Traditional organisation Core Systems Document Repository Desktop Services Workflow Market Repositories Browser Submission / binding Email Trading Partners "Tradition is what you resort to when you don't have the time or the money to do it right." Kurt Herbert Alder Peter Holdstock

LMA Role in Technology Project Objectives • To create clarity in the market about the benefits and implications of, and options for, the adoption of EP. • To extend significantly the use of EP amongst market. Project Activities Electronic Placing Competitive Landscape. Electronic Placing Development & Adoption Roadmap. Further development of EP Implementation Guide. • Governance • Electronic Placing Steering Group. • Electronic Placing Implementation Group. • Electronic Placement Data Standards Group. Peter Holdstock

Evolving Standards Adoption Cycle Broker & Carrier Implementations LMA Implementation Group LMA Data Standards Group Vendors / Products ACORD Peter Holdstock

Some final thoughts… • Products • New products will emerge. E.g. Business Intelligence. • Seamless interaction between products. • Frictional costs will be removed. • Standards • Translation between standards (ACORD/GDV) • Standards for ancillary processes. E.g. schedules. • Take-up and Adoption • More work during transition period. Requires vision. • Goal is Single Electronic desktop Peter Holdstock

"Those who say it cannot be done should get out of the way ofthose that are doing it." Joel Barker Peter Holdstock

Technology Support for Electronic Placing “The best way to predict the future is to invent it”