Reinsurance Data Hub Rides Standard

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Reinsurance Editor

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London

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A life reinsurance data hub has been set up to provide a linkbetween direct insurers and reinsurers in the U.S. market,facilitated by the American Council of Life Insurers in Washingtonand “ri3k,” the London-based technology provider.

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The data hub will allow electronic interchange of data betweendirect writers and reinsurers without requiring manual re-keying,the companies announced.

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By the end of this September, the system is due to be up andrunning on a limited basis in the U.S. market, and fullyoperational by September 2003, said the ACLI and ri3k in a jointannouncement.

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The vendor ri3k also is a technology provider for the non-lifeindustry.

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It is intended that the platform will be operated by aU.S.-based company to be formed by the ACLI and ri3k.

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The data hub will reduce the costs of the administration ofassuming reinsurance, according to Alex Letts, ri3ks chiefexecutive, explaining that one of the main costs of the process isthe requirement to re-key data and the potential inaccuracies thatresult.

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“It will streamline the data from insurance through toreinsurance and retrocession,” he said, using a single standard,ACORD-based format. “It allows data on in-force lives to flowthrough electronically from one back office to the other backoffice.”

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Currently, direct writers use their own formats when they passdata to reinsurers, who must then translate and re-key that datainto their own systems, Mr. Letts told NationalUnderwriter.

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He noted that this data interchange also will help theretrocessionaires gain an accurate assessment of the lives theyhave on their treaties, which currently is difficult for them toascertain accurately.

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In a statement, David Atkinson, chief executive officer of RGAReinsurance Company in St. Louis, Mo., commented that this effortis likely to succeed since the data hub is the result of a jointeffort between direct writers and reinsurers, facilitated by theACLI, which “is structured to benefit all participants, not justthe reinsurers.”

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ACLI and ri3k announced that the hub has been developed with thesupport of a cross-section of American direct writers, reinsurersand retrocessionaires, which served as a technical advisory groupto help with development. Bankers Fidelity, Clarica Reinsurance,ING Reinsurance, Manulife Reinsurance, MetLife/New EnglandFinancial, Nationwide, New York Life, Northwestern Mutual Life, RGAReinsurance, and Swiss Reinsurance are members of the advisorygroup.

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Mr. Letts said the hub is the result of nine months of work.

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“The utility will allow broader access to the life reinsuranceprocess and provide greatly improved efficiency in itsadministration,” said Jack Bailey, senior actuary of Milwaukee,Wis.-based Northwestern Mutual, in a statement. “By automating theinterchange of data, ACLI and ri3k will be helping the industrystay competitive and better serve its millions ofpolicyholders.”

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In an interview, Mr. Letts said the data hub will help drivestandards for the industry. “What we should have, by the end ofSeptember next year, is a platform that is sending out all datarelated to in-force life policies in one standard ACORD-basedformat,” he said. “That would be an absolute first for theindustry.”

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He noted that there currently is no standardization forreinsurance transactions. “ACORD sets standards, but then peopledont drive them. This will drive the ACORD standards.”


Reproduced from National Underwriter Property &Casualty/Risk & Benefits Management Edition, August 5, 2002.Copyright 2002 by The National Underwriter Company in the serialpublication. All rights reserved.Copyright in this article as anindependent work may be held by the author.


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