Digital transformation is critical to the continued success of the London Insurance Market

Just a few years ago, the London Insurance Market became aware that it needed to transform in order to maintain its position as the definitive global hub of commercial insurance and specialty risk. Despite its substantial £60 billion size and a 300-year-old history, the Market’s leadership position wasn’t guaranteed.

A joint study by London Market Group and Boston Consulting Group looked at the Market’s competitive standing and cited the myriad reasons for its historic competitive advantage. For instance, the Market has long had the ability to underwrite the largest and the most complex specialty risk, it has an established symbiotic relationship between London brokers and underwriters, and the high concentration of specialty insurance market participants within the City of London easily enables face-to-face interactions and personalised connections.

The London Market for specialty insurance is enormous, larger than Zurich, Singapore and Bermuda combined, and its influence has been powerful. But while the Market’s strengths were considerable, so were its challenges – and opportunities. Customers were starting to buy insurance locally so the Market was in danger of losing premiums. It had been starting to lose share in reinsurance and was losing ground in emerging markets. Expenses were mounting and regulations were increasing costs. However, the Market also had an unprecedented opportunity to meet unmet demand, reinforce and capitalise on its strength and long-standing reputation, and strengthen its competitive position.

The Market recognised that digital transformation was the key to its continued strength and influence and would grant it new capabilities that would allow it to retain its competitive revenue generation position. However, knowing that digital transformation is essential is one thing, and actually transforming is another.

The London Insurance Market had lagged behind with digital adoption for several reasons. Technology changes were difficult due to the complex and diverse risks involved in commercial and specialty reinsurance. In addition, restrictive legacy platforms held Market insurers back, preventing them from becoming digital organisations. But the Market knew it needed to address digital transformation – and soon – if it wanted to remain competitive.

Digital transformation is key to the continued strength and success of the London Market and to help it retain and grow the skills of a precious asset – its people. The Market is uniquely able to attract talent in part because of its specialty insurance products and its ability to insure complex risks. Now, however, it’s become imperative to retain talent. If the Market doesn’t meet the accelerated imperative to leverage technology capabilities, the talent will go elsewhere.

The ability for carrier and broker communities to trade electronically has become absolutely essential and digital is making it a reality. DXC is now running the Central Services Refresh Programme (CSRP), to deliver improved services and infrastructure for the Market back office, enabling carriers and brokers to adopt global messaging standards and improve the accuracy of records while making it easier to do business in the London Market. CSRP enables insurers and brokers to transact premium and claim payments more quickly, making it easier for customers to do business with them and affording considerable savings. CSRP is developing a capability to consume global ACORD messages, giving them the ability to submit premiums and claims data using EBOT and ECOT messaging standards. The primary beneficiaries of this development are the brokers.

We’ve now built and delivered the platform, so 80 percent of all transactions that brokers process through the bureau (excluding proportional treaty) can now be submitted through CSRP on the Post bind Submission (PbS) platform. There are huge benefits to utilising the messaging. It improves the processing speed, improves quality, provides a single way of working for bureau and non-bureau markets and enables brokers and carriers to process premiums and claims more effectively, all resulting in savings they can then pass back into the market. We expect more brokers will adopt the platform as they see the clear benefits.

We are already at the heart of the London Market since we provide essential central services. We have 140 different carriers using our services. With that comes a responsibility to bring to market digital innovation improvements in processing. DXC is concentrating on bringing our innovation, assets and capabilities to benefit the London Market, and we are focused on creating a true partnership. Our role is to continue to deliver the business process services we have today, and then innovate, innovate, innovate. We look forward to sharing the journey with the Market.

John Taylor headshotJohn Taylor is Account General Manager for London Insurance Market, DXC Technology. He is responsible for ensuring the successful modernisation of the London Insurance Market for DXC Technology and its joint ventures with Lloyd’s, the Lloyd’s Market Association (LMA) and the International Underwriting Association of London (IUA).

Speak Your Mind


This site uses Akismet to reduce spam. Learn how your comment data is processed.