May 3, 2018 by Jason Contant
With an estimated 45% of personal insurance written through the broker channel in Canada, tech vendors understand the importance of the channel.
“Our only business is broker,” Jeff Purdy, senior vice president of international operations with Applied Systems, told reporters at a briefing ahead of the Applied Systems Executive Symposium Tuesday. “We don’t have a Plan B. If broker or agent distribution is not the channel of choice for the consumer, that’s not good for Applied.”
Canadian brokers have a comparatively good foothold in the personal lines space, relative to broker market share elsewhere in the world. Purdy estimated that in the United Kingdom, broker market share expressed as a percentage is “somewhere in the 30s,” and in the United States “it’s probably low 30s.”
The importance of the broker channel has led vendors to work on solutions that aren’t always in their best competitive interests. For example, Applied Systems recently launched its insurer “translation services,” which allow Canadian insurers to translate and distribute policy-related data directly into broker management systems.
“We’re a little bit agnostic about who the insurers connect to, and then we will provide professional services to actually map the data into and out of their back-end system,” Purdy said. “If they use that software, [and] it connects to our competitors, we have no issue at all with that actually. It’s for the benefit of broker distribution. Our role in the value chain is to enable our broker customers to connect to their insured and enable their insureds to interact with them in the way that the insured wants to.”
Earlier this week, the Insurance Brokers Association of Ontario announced that it had garnered the support of at least 16 insurance companies and “all key broker technology vendors” to participate in a study on data connectivity. The study includes discussion about an application programming interface (API) model that would connect brokerages with carriers.
The broker association will also be hosting an “industry strategy meeting” to address data connectivity, scheduled for May 24. Purdy said that Applied will be involved in that meeting.
“A number of the [broker] associations are highly interested in enhancing broker-carrier connectivity and we would be talking to everyone who is interested,” he said. “If it’s good for broker distribution, it’s good for Applied.”
At its Executive Symposium, Applied launched IVANS Exchange, a new online tool for independent brokerages to view, track, report and manage their insurer download connections. Available to Applied Epic users, the tool “provides brokerages a simpler, more comprehensive view of their current and potential download activity with insurers,” Applied said in a statement.
Key capabilities of the tool include: