Nearly two years after Lloyd's abandoned Kinnect--the failed multimillion-dollar electronic trading platform--a new messaging system with a smaller cost to users is being studied.
With more than 70 percent of premium transactions and 75 percent of claims now being processed electronically, Lloyd's is looking to streamline its risk placement process, according to Louise Shield, head of Lloyd's Communications, Corporate Services in London.
"We've made good progress over the course of the last year in terms of business process reform," she said, explaining that the Lloyd's markets have "asked us to look into the possibility of providing a messaging hub, which would essentially be providing a service so that businesses can talk to each other and interact via this hub."
Ms. Shield said the "sophisticated messaging service" is similar to e-mail, but that messages would be communicated according to ACORD standards--meaning more detailed and complex data could be sent electronically. It also would link to existing providers.
"This would mean that anyone with Internet access could use it," she said, explaining that the process is very different from Kinnect. "Kinnect was a huge system that was built from scratch," which meant that "people had to sign up to purchase it," she said.
While the "Messaging Hub" is not yet definite, Lloyd's is looking into the process of setting it up. "It would be a small pilot; it would be using an off-the-shelf product," she said--which would mean a large savings to users.
What is the time frame? "Within the next couple of months, we'll decide if it's something we want to pursue," she said.
Lloyd's announced in January 2006 that following the Kinnect board's recommendation, the Lloyd's Franchise Board would not fund the Kinnect platform going forward. The board decided the platform was "not optimal in ensuring more efficient business processes for the Lloyd's and London market, and as a result it will close."
Lloyd's said, "There is a clear view that the Franchisor's role going forward should be primarily on standards setting, not building infrastructure."
However, Lloyd's also said in 2006 that it would provide support in "developing standards for peer-to-peer systems and hubs," and because part of the market is unable to meet the standards, the Franchisor would "consider ways to give support."
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