Insurance Data Diary

No. 1, July 2022

Insurance data and technology commentary and news from Quotech Founder Guillaume Bonnissent.

Starter for 10: Acord for London

On Tuesday the London Market Group, which brings together Lloyd’s, the IUA, and the brokers, launched a consultation on revising the Market Reform Contract, which it hopes will promote a single ACORD data standard.

It goes almost without saying that the adoption of a common data standard is essential to realise the vision of a digital London market, so it’s great that the Powers That Be at Lloyd’s and in the wider London speciality insurance market – embodied in the London Market Group’s ‘Data Council’ – have agreed on something concrete to do with data.

The grandees of the Data Council made their choice swiftly, but if anything I’m surprised that London took so long to decide. Acord was the best option when I was underwriting a decade ago, and it remains the best-bet standard today, at least relative to the alternatives. The OPEN Standard, for example, is focussed almost entirely on consumer lines, and although its simplicity in covered speciality lines, including BI and cyber, make it attractive, they render it entirely impractical at the same time.

Similarly, Polaris standards – widely used applications including especially price comparison websites – are heavily consumer-cover focussed. They extend successfully to SME coverage, with a wide range of standards for common commercial insurances, but when it’s cover for an oil rig, or for complex international casualty exposures, or for any of the myriad other special risks London is so good at insuring, Polaris isn’t in the game.

So when it comes to broadly useful data standards for speciality-market risk data, Acord is the only runner. That’s probably the main reason that the Data Council, once created, chose Acord very quickly (no doubt edged along by Acord MD Chris Newman, who’s a member of the Council). The late-December decision of DXC, which runs the market’s joint settlement bureaux, to adopt Acord for its broking solutions won’t have hurt, either.

As standards for speciality insurance risk data go, Acord is the best out there by far. That’s not to say it’s perfect, but if users from all the market’s niche specialities put in their own two cells worth to make it as useful as possible, and if their input is welcomed and incorporated, it could soon get close.

Similarly, any and all Quotech installations can or already do work with Acord standards. Since the market has made its wise decision to adopt them wholesale, all our future London installations will be Acord-ready.

Swiss Lab @ Lloyd’s

I am intrigued to read that Swiss Re is to join Lloyd’s Lab, which is typically reserved for enthusiastic revolutionaries with grand ideas about insurance in one hand, and a tin of Mountain Dew in the other. The plan is to collect and assess ESG data on private companies, and compile it for delivery to insurers in an underwriting-friendly way to help them decarbonisation their books. It’s a great idea, although it’s not the only play in the game. Scores of services already offer ESG scores for investors, including some big boys like Dow Jones and S&P, and pop-ups including “Sustainalytics”. I for one don’t particularly believe in reinventing the wheel. Given a data feed from any of these myriad providers, an ESG assessment tool can be built into any Quotech platform.

Elsewhere in the news…

Some data stories that caught my eye:

Placing Platform Ltd’s ‘Next Generation’ update has been published by Bronek Masojada. Watch this space for my thoughts.

Demotech, the US insurer ratings agency declares that things like the regulatory, legislative, and judicial environments must be considered alongside financial data, since they may affect the operating environment of insurers positively or negatively. Good point.