Kinnect Handles Open Risk

Kinnect, a Lloyd's of London-sponsored international venture to electronically connect brokers and underwriters, reached a milestone by handling its first complex open market risk. A U.S. commercial property risk was transferred on Feb. 4 across the Kinnect platform by London-based brokerage Willis into insurer Amlin's (London) ROOM Solutions (London) underwriting system. Last December, Kinnect handled its first live risk, also placed by Willis, under an existing facility agreement with Lloyd's underwriter, Wellington.

By handling the less-standardized open market risk, the Kinnect platform has demonstrated its ability, according to Iain Saville, Lloyd's head of business process and Kinnect's executive chairman. "Handling extremely complex risks is a major strength of Lloyd's. We must now move rapidly to writing such business in a secure electronic environment, thereby creating a greater degree of contractual certainty and supporting fast and accurate business processing," he said.

Kinnect's latest accomplishment is encouraging, says Craig Weber, a Boston-based analyst with Celent Communications. "Each step up in complexity is a good test of the system."

The true test, according to Weber, will occur when participants put business into the system in real production volume. Handling both structured and unstructured data is a difficult task, he points out. "But Lloyd's has spent two years devoting resources to it, so if [an effective exchange] is ever going to happen, this could be the one."

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