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.
Vote for your IT greats
Who have been the most influential people in IT in the past 40 years? The greatest organisations? The best hardware and software technologies? As part of Computer Weekly’s 40th anniversary celebrations, we are asking our readers who and what has really made a difference?
Vote now at: www.computerweekly.com/ITgreats