Everyone hopes for a smooth Brexit transition, but the clock is ticking for insurers to get their data checks in order, writes Nick Mair, founder of Atticus DQPro.
The dramatic Brexit headlines just won’t let up as the shape of the final agreement remains unclear. As I recently wrote in an article for Insurance Day, there is a clear need for insurers to act swiftly to write their Brexit rule books, and ensure their data is compliant.
Insurers need oversight and confidence when it comes to business being written in Europe, either routed through the new Lloyd’s subsidiary in Brussels or through a company’s own EU domicile.
Increasingly, we are seeing demand from users of our technology for Brexit tool kits – sets of rules that can be applied to monitor incoming and outgoing data, looking through the lens of a carrier, precisely with this vision in mind.
Here’s what this means from a data perspective:
- Businesses routing business through Brussels require new processes and checks to ensure compliance, e.g. for the correct stamp for risks from within the European Economic Area.
- Mistakes – including using the wrong stamp – repeated unchecked across business classes could risk hefty fines by regulatory authorities.
- Insurers clearly need an agile, flexible tool and oversight that will help them quickly adapt to new rules and achieve contract certainty in an uncertain regulatory environment.
We’re seeing interest from carriers, MGAs and brokers, all similarly troubled by Brexit and the scale of the data challenges it presents. Because of the timescales involved, and the existing myriad of legacy systems that are often in use in insurance businesses – particularly multinational businesses – there is a need for technology that offers oversight of a firm’s existing architecture.
We’re working on a solution – DQPro’s Market Rules library already has at least 200 different rules for various jurisdictions, with its own expanding Brexit subset, something we’re not aware that has been done before.
By setting a “validation standard” that all carriers can work towards, we’re setting a new bar for market data quality.
My call to action for the London Market is this – we require a clear set of checks combined with a flexible solution to apply them easily across the vast array of carrier side legacy systems, allowing for change as we go.
When the UK quits the EU on 29th March 2019, the way London market firms do business with Europe will change forever. The volume affected is significant, about 14% of Lloyd’s premium, amounting to about £4bn of insurance business.
The London specialty market cannot afford to lose market share as a result of Brexit, and the clock is ticking to get this right.