Lloyds of London invests £20m in online platform for brokers

The Lloyds of London insurance exchange is spending £20m on an online platform that will allow brokers and underwriters to transfer and analyse risk data for policies electronically.

Lloyds has been working on the project since 2001 and is set to launch Kinnect as a commercial venture in the third quarter of this year. It will sell the service to insurance brokers in the commercial lines – corporate risk – sector in the UK and US.

Phil Bungey, chief technical officer and programme director at Kinnect, said the platform will allow brokers to replace inefficient paper-based processes.

“We are dealing with something that supports the largest insurance companies in the world. The process can be very long and there was a need for the insurance industry to pass data and carry out processes and the reason for that is to increase the efficiency of what they are doing.”

The platform is not an actual trading exchange but supports the online transfer of risk information and documents needed by brokers and underwriters in analysing and putting a policy together.

Broking companies can choose to connect their systems directly to the platform or use a web-based service. Six insurance brokers have already signed up for the service including Marsh, Willis and Amlin.

Bungey would not disclose exact return on investment targets but said Kinnect has been set up as an additional revenue stream for Lloyds of London.

“It has always been designed in mind that we will be a commercial organisation. We have got some more customers going through feasibility studies and it is based around a comprehensive five-year plan.”

Lloyds chose Hewlett Packard (HP) to build the J2EE-compliant platform, which is based on HP hardware, BEA WebLogic, Oracle 9i and Baltimore’s SecureAccess authentication technology.