Insurance Age - Working with the web

Insurance Age - Working with the web: "Working with the web"

The internet is increasingly becoming the medium to use when promoting new schemes, and the abundance of offerings from software houses are allowing brokers to push ahead of their competitors. Sarah Hills explains the significance of being online
While the market has come to grips with the importance of technology, it is the schemes sector that appears to have recognised the true significance of being online. As such, the change in dynamic within the schemes sector has seen a shift from manual process to a rise in bespoke electronic packages.
For software house CDL, the mechanised nature of a web-based scheme works in the same way as the personal lines sector; the level of automation is similar to the risks involved with car insurance, and the online process is nearly identical.
Rick Slater, general manager at CDL, explains: "Apart from giving a broker the edge over its competition, the principal benefit of schemes is that the intermediary has control of distribution. If schemes are provided on an in-house system, it makes things far quicker and slicker for the broker. Streamlining the process saves time and money, because the broker can quote upfront and issue policy documentation efficiently."
In terms of efficiency, the use of back-office systems has become more common. Simon Ronaldson, sales and marketing manager at Acturis, comments: "As long as a broker is prepared to invest in marketing its schemes, then it can set up the possibility of competing with the directs. The nature of the schemes works well on the web - for example, web-relationships with the affinities."
He adds that this attitude should extend away from the schemes sector, and into brokers' other interests. "Web-based products are important for schemes but also for brokers dealing with small to medium-sized enterprise business. Brokers know about all the possibilities, and are trying them out to see which area suits their business."
While brokers can compete against super brokers and direct insurers, as well as tap into niche markets, there is also the issue of functionality. Web-based schemes offer another way to secure business and expand distribution channels in a quick and efficient manner.
To build an electronic scheme, a broker generally needs to define the data capture, rating, workflow and documentation. This can be done in collaboration with a software house - each with their own solutions. Typically, the software house will undertake the initial scheme build and transfer the skills to the broker, which allows it to make subsequent changes or build further schemes on its own.
Simon Hughes, sales and marketing director at Open GI, says the number of brokers using its technology has doubled during the past 12 months. "We are continuing to see a shift towards the electrical trading of schemes business. It's an area where brokers can compete through specialisation, and play to their unique strengths," he explains.
Mr Hughes adds that schemes are profitable if traded efficiently and effectively by using technology, and can be made more accessible via channels such as the internet. "Brokers can now benefit from the same processing efficiencies that exist for open market products. They also have more control over the sale of scheme business than they do for open market business because of the deals they have in place with insurers. Therefore, there are less limitations."
K Drewe Insurance Brokers specialises in leisure insurance schemes and, according to MD Ian Drewe, web-based schemes have enhanced the firm's offering to the market. "It provides another way for brokers to trade with us. We try to 'plug holes' in distribution channels, and online trading has opened up many opportunities for us."
Mr Drewe adds that the internet is impossible to ignore, as it has become an integral part of people's lives. "The internet is now in working use for brokers and the 'silver surfers' - the over-50s with home computers - have emerged, which taps into our traditional market. We can sell caravan insurance on the internet - it makes for more flexibility with the whole of our operation," he explains.
The choice of software solutions means that brokers can select the package that best suits them, such as running their own scheme on their website or a bolt-on scheme on a wholesaler's website, such as K Drewe. The growth in the number of brokers using scheme technology is a testament to the fact that this is an area where brokers can compete through specialisation. In addition, with the tools to enable brokers to be self-sufficient and cut down operational costs, the web can help brokers reach their ultimate goal - profitability.
EXAMPLES OF OFFERINGS FROM SOFTWARE HOUSES
Acturis
- Acturis Broker System - A front and back-office broking solution for personal and commercial business, as well as accounting and reporting process management.
- Acturis Product Builder - allows brokers to trade bespoke scheme products, with full auto-rating, automated documents and bespoke bordereau production.
- Acturis Quote and Buy - allows brokers to web-enable either their own bespoke scheme products built via the Acturis Product Builder, or auto-rate open market products. Customers can access the products direct from brokers' websites, generate instant auto-rated quotations, make payments to bind cover and receive policy documentation online.
CDL
- CDL Strata - a multi-tier application that supports a variety of hardware platforms and operating systems. The tool enables commercial and personal lines intermediaries to support branches or divisions in one common database. CDL Strata contains generic risk sets based on imarket industry standards for small to medium-sized enterprise products, and also includes a Product Designer for larger intermediaries that allows them to create bespoke risk sets for open market business.
Insurecom
- Agency Plus - a business package built for schemes and commercial products. AgencyPlus is a smart-client, SQL-based broker application, designed for growing brokers. It includes features such as Financial Services Authority management tools, imarket integration, schemes and UK e-business requirements. Brokers can use a navigating interface based on a single screen, with a multi-client and multi-activity functionality.
Software Solution Partners (SSP)
- SSP insight - a broking system that comes with a product set of more than 100 different classes of business. The integrated product builder allows brokers to create new products or schemes.
- SSP electraM3 - designed for panel-based personal and commercial lines brokers, it includes point-of-sale documentation through to back-office client administration, reporting and accounting.
- SSP sector - an insurance package system designed to support a wide range of commercial broking operations across retail and wholesale insurance, including small commercial packages, scheme and affinity specialists and the London Market.
Sirius
- Nexus - a trading platform for existing Sirius 21 users, this product allows members to market scheme products to three trading streams: personal consumers, other brokers and other Sirius 21 brokers - all within the Nexus community. Sirius will build, host and maintain any e-commerce website it designs, requiring around £5,000 to £15,000 investment for start-up costs, and then 3% of the gross written premium generated by the scheme.
Open GI
- X-Stream solution - allows policy administration, underwriting rules, rates and documentation to be held in a back-office, while being controlled in a web trading environment by the broker's clients. Scheme Toolkit enables brokers to design and maintain their own unique data capture screens with configurable workflow and rating.