We often have waved the banner for standards in this magazine and in this column. Weve applauded the efforts of organizations such as ACORD, the W3C, and even software vendors for their endeavors in providing standards that will enable us to create efficient, interactive software systems. Weve lauded the goals of SEMCI and universal XML standards for the insurance industry. Before XML, we praised EDI and fledgling data standards like OLifE. We always have come down on the side of standards. An early incarnation of this column was called Standards Bearer. Maybe we went too far. Maybe we have been asking for too much of a good thing. This month, I am going to look at standards and see whether maybe we havent been trying a little too hard to standardize everything.

SEMCIWho Cares?Look at this: SEMCI [single-entry, multiple-company interface] or what is evolving into STP [straight-through processing] means using one system, such as your agency management system, to enter data and communicate with multiple carriers and vendors for quoting, policy issue, and inquiry. That is straight from the horses mouth. Now this might, in fact, be the holy of holies for an agency, but it does not bode well for the carrier. Do you really want to further enhance the perception that certain types of insurance coverage really are commodities by providing the same interface as every other carrier? Homeowners and personal auto coverage increasingly are being thought of as commodities. And what is a commodity?

It generally is assumed to be physical substances, such as foods, grains, and metals, which are interchangeable with another product of the same type. The price of commodities is solely dependent on the laws of supply and demand. Is this where you want to be? I dont think so. If we only care enough about the services we offer to differentiate them from the competition by price, we probably wouldnt bother with advertising. We also have no interest in offering a product that is wholly and easily interchangeable with a similar product offered by another carrier.