Since its formation, the London insurance market has been reliant on manual processes and hard-copy documentation for the transaction of business between broker and underwriter. The associated inefficiency; the high cost of handling paper, the lack of control, the lack of immediate availability of records and the delays in serial distribution of paper - with the associated negative impact on customer service and competitiveness - have led market organisations to implement electronic processes to support the placement and amendment of insurance business.
Put simply, electronic support for placing is the electronic exchange of data and documents between trading partners to support the transaction of insurance business, whether a new risk, a renewal or a mid-term amendment. Electronic support for placing does not replace the face-to-face negotiation of business which is a key strength of the London insurance market and an important aspect of the transaction of the large, complex and specialist risks for which London is renowned. However, electronic support for placing opens up opportunities to improve customer service and increase the efficiency of the placing process by using face-to-face negotiation more selectively - where it really adds value - and by transferring data and documents electronically rather than solely in paper form.
LMG’s Placing Support Steering Group has defined its vision as 'The use of electronic processes, compliant with ACORD international data standards, for the submission of risk details, the agreement of terms, and contract formation for all risk placements and contract amendments in the London market, enabling the selective use of negotiation outside the electronic process where required by trading partners.' This vision sets out a goal; the use of electronic processes to support all aspects of the placement of business, alongside face-to-face or other negotiation where this is seen as desirable, for all business transacted in the market.
Work is underway in three key areas: placing, endorsements, and binding authorities.