Monday, November 16th
11:30 a.m. - 12:15 p.m.

The Search for Standards:
New Developments in Insurance/Reinsurance Links
-- Robert Gilligan, Brokers & Reinsurance Market Assn.
-- Bill Tedrick, Production Management VP, BWC Systems

"Internet Helping Insurers Catch Up to Technology"

Insurers are at least a decade behind other industries in the use of electronic data interchange to conduct business, but the Internet could be the equalizer that will help them make up for lost time.

To speed that process insurers need to build bridges between their legacy systems and their new electronic commerce initiatives, Bill Tedrick said Monday during the A.M. Best Co. Insurance Information Management conference in Boston.

Tedrick, who is president of BWC Systems Inc., a division of IVANS, urged insurers to think ahead as they develop e-commerce initiatives so that current endeavors can grow into future initiatives.

"If you are developing an intranet, make it strong enough to take out to the Internet some day," he said.

Tedrick also suggested that insurers build a graphic interface to the front end of their systems and give everyone browser access to that portion. "That can extend the life of a legacy system," he said.

And, they can buy software that will create an e-commerce framework for a company in 90 days, Tedrick said, noting that not too long ago it took up to four years to create a similar product.

Insurers, reinsurers and brokers have been working for several years to develop standards for electronic data transmission. And while the Internet may render other modes of data transfer obsolete, the reason for setting the standards remains valid.

"The purpose of setting EDI standards was to have structured data so systems that started out in disparate situations can talk," said Robert Gilligan II, president and chief executive officer, The Brokers & Reinsurance Markets Association.

Internet protocols such as html and xtml are being adopted as standards, Gilligan said.

"A major turning point was AIG's commitment to go electronic using EDI Joint Venture standards," said Gilligan, who was one of the original architects of the EDI Joint Venture between several trade groups including the London Insurance Market Network and the World Insurance Market.

Major obstacles that must be cleared for the use of electronic business to grow include:

• Commitment. "It is difficult to get people assigned to work on EDI for the necessary period of time," Gilligan said.
• Pervasiveness. The value of EDI will be determined by the number of people using it.

There are more than 80,000 pairs of companies transmitting business electronically through a variety of links that range from e-mail to the fully automated computer-to-computer exchange, Tedrick said.