Even the simplest of undertakings to establish standards within the insurance industry is a big job. Since ACORD (Pearl River, NY) is an association of industry representatives rather than a regulatory body, ACORD membersinsurers and technology vendors, both with unique interestsmust sit down together and come to agreement. And as the standards body tackles ambitious objectives, perceptions about its priorities and the pace of progress tend to show a divide between carriers' and vendors' perceptions.
The contribution of ACORD to date gives every reason to expect indispensable work in the future, suggests Rick Williams, director of technology for Web-based financial services provider Financial Keyosk (Carpentersville, IL). Under the leadership of president and CEO Greg Maciag, the organization has "successfully taken the bull by the horns and tackled the two-decade-old problem of interface with insurance carriers and actually delivered a standard just a few years after the Big I ACT mandate," which challenged the industry to develop an XML-based interface standard, he says. "ACORD's challenge now is to keep focused on the narrower problem until more than a handful of P&C carriers have working interface technology."
Maintaining focus on manageable objectives is likely to be disrupted by ACORD's involvement in eMerge, a project designed to establish a global insurance data standard, Williams fears. While its goals are "ultimately very desirable," according to Williams, "the perceived risk is that ACORD will be spread too thin by tackling all lines of business across the globe," he says. "I'd prefer a persistent effort to really make electronic interface work in the domestic P&C business that is the bread and butter of tens of thousands of agents and their carriers, and where a real, achievable payoff to interface is virtually within reach," he adds.
Josh Lee, global technical strategist, insurance enterprise and partner group, Microsoft (Redmond, WA), who has participated in ACORD convergence advisory committee meetings, says the organization's initiative to converge data specifications for life insurance and P&C was a good idea that was unnecessarily complicated by pursuing a data model to standardize business processes. As a result of such ambitions, ACORD's progress "has been completely slowed down," Lee says. There is greater value in more modest objectives, and by pursuing "grand schemes," instead, he adds, "ACORD can't get out of its own way, and it hasn't delivered."
A different view prevails at The Hartford (Hartford, $167 billion in assets), according to Hugh Anderson, assistant director, e-business in The Hartford's P&C area. "You're just not going to get instant gratification," he says. "Anybody who perceives that progress is slow is probably not as involved as they need to be both from a technology-based architectural view and across the whole spectrum."
A cause of slowdown acknowledged by Barbara Koster, senior vice president and CIO, individual life insurance and retail distribution, Prudential Financial (Newark, NJ, $371 billion in assets) and a member of ACORD's board of directors, is a failure to get insurance company membership attendance. "That's where it's important to have a network to reach out to the CIOs in the different companies," she says. "We've got processes in place now that are moving things along nicely."
Koster emphasizes the commitment of her firm to the process. "Over the last year or so there's been a lot of delivery because we the ACORD board of directors are participating because we need this for our companies; we need there to be one customer view of things, one standard set of definitions and forms," she says.
Collaboration Is Key
In any organization that works through the collaborative efforts of volunteers, it's going to be hard to please all of the people all of the time, according to Rick Gilman, vice president, corporate communications, ACORD. "We do on occasion miss deadlines and people will question priorities," he says. "Could we do more and faster? Sure, if we had more resources and greater commitment from the companies and the solution providers." He adds that ACORD is always looking for ways to engage those working at a different pace than the industry as a whole.
ACORD's challenges have only increased as it has taken on reinsurance and large commercial standards in Europe, Gilman acknowledges. "As we undertake to bring all these things under a single data model through eMerge, the management of all those aspects is challenging. Butthat's what we do."
Anthony O'Donnell has covered technology in the insurance industry since 2000, when he joined the editorial staff of Insurance & Technology. As an editor and reporter for I&T and the InformationWeek Financial Services of TechWeb he has written on all areas of information ... View Full Bio