Lloyd's of London has no plans to reverse its recent
arm's-length approach to market technology, five months after
walking away from an ill-fated £70m investment in electronic
trading, the insurance market's IT chief has told Computer
Weekly.
Chris Rawson, chief information officer at Lloyd's, said the IT
department's commitment to the market now centred around standards
rather than infrastructure, and the recent arrival of new chief
executive Richard Ward was not likely to change that position.
"We will act as a facilitator of market standards but not go
beyond that. We want to assist the market wherever possible, but
this is a very different model from that which was in place before,
and nothing will be mandatory," he said.
In one of its first moves since the closure of the market's
Kinnect electronic trading hub, Lloyd's last month began offering a
library of files to market participants to enable consistent data
validation and support the use of electronic business.
The XML-based Schematron initiative, developed for Lloyd's by IT
services company Trisystems InfoBahn, should save market companies
or their suppliers the cost of developing their own validation code
and make it easier for firms to exchange data between systems.
Michael Knight of Lloyd's IT group said the commoditised
validation offered by Schematron should also simplify version
management for developers, since it uses Acord XML data standards
and is due to be adopted as an ISO standard under the title
Document Schema Definition Language.
"We took the plan to the market and the response was very
enthusiastic," said Knight. "Wherever firms are implementing
electronic messages this could be attractive."
Lloyd's has covered the funding for the project, which Rawson
said cost only tens of thousands of pounds, without seeking any
contribution from market participants.
"Relatively inexpensive but valuable propositions like these
will be the main target for the market's IT for the foreseeable
future," he said.
Collaboration from ashes of Kinnect
The closure of the Kinnect electronic trading platform in
January has enabled new developments in the relationship between
Lloyd's of London's back-office and RI3K, a commercial electronic
trading hub serving the market.
Xchanging, which processes policy documents at Lloyd's and is
part-owned by the market, recently joined forces with RI3K to agree
a framework to chart and meet the businesses process, messages and
other technology requirements needed to provide an end-to-end
electronic insurance exchange to market participants.
Known as Felix (Framework for the Electronic London Insurance
Exchange), the roadmap would have been unlikely to be agreed prior
to Kinnect's closure.
"Until Kinnect closed we could not collaborate with Xchanging,
as we were perceived as a threat," said RI3K chief executive Alex
Letts. "Its closure has been a catalyst for a huge frenzy of
activity across Lloyd's, and we suddenly have the makings of an
electronic market."
The collaboration should lead to the first integrated front- and
back-office by September, and a fully joined up electronic market
at Lloyd's by the middle of next year, according to Letts.
Key players in the insurance market, including the Group of Six
- a collection of insurers pushing for modernisation at Lloyd's -
have welcomed the initiative, which has been further boosted by the
pick-up in electronic trading activity on RI3K's Marketplace. This
has led the service provider to cut its charges by 80% as volumes
increase and brokers sign up.
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