No. 7, December 2023

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

Speakers Call for More on London Market Data Systems

Calling for a common language: Isachsen (centre) with Kitchen and Insider Editor Fiona Robertson

Good news from Chris Halbard, the recently installed CEO of Velonetic, the organisation formerly known as Xchanging. The newly renamed processing bureaux (now labelled with a mashed-up word which we’re told combines ‘velocity’ and ‘kinetic’, and warms me to the old ‘Joint Venture’ moniker) – is to be delivered on schedule, Halbard told a packed audience at The Insider’s recent London Market conference. Never mind that it should have happened ten years ago.

The market’s upgraded London Processing Centre (remember that name?) will move from a creaking mainframe system (which has more stalls than the Royal Albert Hall) to a completely remade, cloud-native platform. Full market testing is set for 1 July, following more limited testing in April.

Hurdles remain, however. “We need feedback from the market on messaging pretty quickly,” Halbard said, although he estimates that 80% of existing business needs no format changes.

Nor does the long-overdue overhaul of Xchanging take Lloyd’s and the London market into full digital territory. “Everywhere I go in the market,” said Matt Unsworth, Lloyd’s ‘Transformation Director’ and a member of the same conference panel, “people have ideas that are more ambitious than what Chris is doing.”

He noted that underwriting businesses need to put in place streamlined digital services which prepare the data packets to be sent into market systems. “That has to be done to realise maximum benefits,” he said. He noted too his opinion that the market’s forthcoming ‘Core Data Record’ is “too narrow… we can evolve and build on it,” he said.

A later panel echoed the need to keep up the momentum. “Blueprint 2 delivers the table stakes for moving forward all things we should have done years ago, [like the CDR,] that we need in place before we can do all the exciting things we see in the future,” said Christian Kitchen, CIO at Travelers Europe.

Citing data translation as the market’s “most expensive process from a technical perspective,” he called for the market to develop a “native language” of risk, which would eliminate that cost, and remove errors in translation, as well as the validation processes necessary to spot them.   

Bent Isachsen, the Hamilton COO with nearly 30 years’ market experience, narrowed down the call. “Surely we can agree the ten fields we need at minimum for a submission,” he plead. “Having data in a common language will not give away the secret sauce of underwriting. Instead it will allow underwriters to enrich their data with third-party data to differentiate from their competitors.”

How would one accomplish all that? Call Quotech, for a start.

The Beautiful Data Game

West Ham v. Arsenal, April 2023. Photo: Thomas Dahlstrøm Nielsen, CC BY-SA 4.0

Was the Qatar World Cup good for player fitness? The answer from the global insurance and risk advisor Howden is a resounding NO.

Its Men’s European Football Injury Index 2022/23 reveals new insights derived from data which show that FIFA Men’s World Cup players from the top five European leagues spent, on average, eight days more sidelined due to injury following the tournament.

Worse, Howden found that the tournament preceded an overall increase in injury severity. In October 2022, pre-tournament, 88 recorded injuries put players on the bench for 11.35 days on average. After the Winter World Cup, the numbers were 64 and 19.41 days. The most lengthened damage types were extended were injuries to hamstrings (stretched by 130%), to ankles (170%), and calves and shins (200%).

More player time out of action of course has a hard financial impact on clubs and their insurers. Injury costs rose by almost 30% in 2022/23 relative to the earlier, pre-Covid period, soaring up from €553.62 million to €704.89 million across the top five men’s European leagues.

Howden identified these trends by collecting, understanding, and effectively using data. The critical analysis is accomplished by deploying an intelligent underwriting and data management platform, like Risque from Quotech.

The same techniques that help us to understand the incidence and impact of football injuries will work equally effectively for cargo losses, shareholder law suits, kidnaps, airline delays, etc. To underwrite without such knowledge is akin to striking at an open goal without knowing which direction you’re running.

Elsewhere in the news…

Some data stories that caught my eye:

ACORD, the non-profit, insurance-industry-owned, digital standards-setter which sets the standards for the London market, has published a new version of its Next-Generation Digital Standards, v. 1-18-0, which contain “an inventory of entities and data elements used to generate a suite of JSON and YAML data-interchange formats based on a microservices architecture and RESTful API Specifications.” We’re delighted too that ACORD recently declared: “The underwriting workbench is driving significant efficiencies for underwriters across the industry by making data more available, more abundant, and more timely.” Quotech’s ACORD-compliant, underwriter-designed underwriting workbench certainly does all that, and more.

We are enthused to see more data-driven, algorithmic follow underwriting in the London market, with the news that the Lloyd’s carrier Apollo has underwritten its first “smart follow” lines through its venture for the purpose, Apollo Smart Follow. We see a big future in smart follow underwriting, and admire the independent exchange model championed by the likes of InsurX.

An interesting approach to the use of big data was reported in the Global Risk & Resilience Fellowship Summary Report 2023, a recent report from Howden published with the Resilient Cities Network and the Sustainable Markets Initiative. They’ve looked at big-data methodology to measure cities’ progress towards the UN’s Sustainable Development Goals. The result is a fascinating and tangible set of resilience-building activities involving the insurance sector.

Client focus: Samphire Risk

Quotech and Samphire Risk have worked together since the launch of the specialist MGA. Samphire underwrites across the spectrum of malicious and hostile risks, including coverage for malicious attacks and extortive crime; hostage-taking and kidnap; terrorism in all its guises; travel into, and within, insecure countries and locations; and business integrity and general security risk.

Behind the Samphire team’s unparalleled specialist knowledge, the MGA deploys Quotech’s Risque pricing platform, alongside other modules that form our comprehensive underwriting workbench..

CEO Charlie Hanbury says: “Quotech allows us to operate from the front end of the business to the back end in a highly efficient manner. From document issuance, through to aggregation monitoring, underwriting controls and automated bordereau production, Quotech really is a ‘cradle to grave’ underwriting platform. It therefore allows us to focus the majority of our time on product development, good underwriting and great service – all things that Samphire has a growing reputation for.”

News From Quotech

The Quotech Blog: You must choose, but choose wisely
Part 1: Binder capacity

Make the right choices, and your decisions will drive you inexorably towards your goals. The only challenge is to know which options will have what impacts.

It may not be obvious that your choice of underwriting platform could tip the balance when it comes to recruiting and retaining underwriting capacity for your MGA… but it might. Read how in the latest Quotech blog.

Welcome Aboard!

Quotech welcomes Dmitry “Dima” Droban as Commercial Director. Dima spent most of his 20+ year career as a marine underwriter. A globetrotting Londoner from Ukraine, he joins Quotech after leaving his underwriter’s desk for three years to establish an insurTech in Vietnam. Dima identifies first as a problem-solver, informed by his invaluable multinational perspective to foster success built on effort, concentration, and powerful teams. Tech is now essential, he adds. “Using new solutions in our old, traditional industry fuelled my interest in technology,” he says. “I find introducing disruptive solutions into old corporate structures challenging, but also thrilling and inspiring.”

We are happy also to report that Daniel Loader has joined the Quotech team as Lead Platform Engineer. Daniel has spent nearly a decade honing his craft in diverse sectors stretching from groceries to cyber security, working for household names like Iceland and Nominet. Now he’s made the crossing to insurance. From his home office in Manchester he works his magic for Quotech clients, with limited support from his cat Piggy and his tortoise González. His goal: to enable software engineers and ultimate users to work faster, with greater reliability, in part by deploying adjacent technology disciplines that provide the platform and services they need to succeed.