The notorious inefficiency of insurer-reinsurer transactions is starting to be addressed now with online platforms driven by the buyers of facultative reinsurance. In fact, some industry observers believe it will be the needs of reinsurance buyers that will drive the models for e-commerce in the insurance and reinsurance arena. Buyers want to be able to send their business through one channel, sources say, rather than being forced to access different proprietary platforms run by different reinsurers, which requires multiple data re-entry.

The reason that buyer-driven platforms may dominate, according to some sources, is the buyers desire to develop a management information system. Buyers create their own platforms to gain control of their portfolios, says Jrgen Petzold, senior underwriter for Hanover Re and head of the companys Center of Competence Facultative E-Business.

He points out online platforms being developed by Royal & SunAlliance (RSA) and Axa Group, for example, were initiated as management information systems. They realize markets are changing, and theyd like to get control of their book of business, he says. As a result, these insurers and others are aiming to steer their facultative portfolios via such online platforms, which is also attractive for the sellers of reinsurance.