New Data Standards for Commercial Insurance

By: Monica Hanna, Business Analyst, CSIO | December 2018

Commercial lines are evolving: The broker channel is moving forward with implementing commercial lines data standards. This development promises many broker benefits, including speeding up the process of quoting, underwriting, and servicing commercial policies.

CSIO data standards are well established in personal lines, and as a result, the workflow is very different from commercial lines. In personal lines, broker management system (BMS) vendors and carrier systems use the standards to exchange policy information and eDocs, meaning much of the work to analyze and underwrite policies is handled electronically behind the scenes. Policy information is downloaded directly to the BMS, and eDocs automatically attach to the appropriate client file.

Typically, workflow in commercial lines is much more manual, with little consistency in how brokers need to submit client information to different carriers when obtaining quotes. Some carriers have online portals, while others require brokers to submit a form via email. In some cases, brokers type out an email, resulting in more work for commercial underwriters. Further, there is no commercial data download, so your BMS does not automatically populate with the policy data it needs to create a client file, and commercial eDocs must be processed and attached manually.

“Although brokers use data standards and transfer in personal lines transactions, that capability just doesn’t exist in commercial lines right now,” says Andrew Janzen, president of Janzen Insurance in Surrey and chair of IBABC’s Technology Committee. “Even if a broker takes the time to load detailed underwriting and coverage information into a commercial management system, without standards it really isn’t useable in communicating with carriers.”

Industry consultation

CSIO’s XML data standards for commercial lines are up-to-date, mature and ready to be programmed. To help understand the path forward in implementing commercial lines data standards, CSIO commissioned the Conference Board of Canada to conduct extensive industry consultation through a broker focus group, phone interviews with carrier executives and vendors, and a survey of brokerages.

The research found that more than 90% of brokers said they are more likely to work with carriers who have implemented data standards. Use of the standards would enable consistent workflow, faster and more accurate information exchange, and reduced double-entry. However, the study also found that due to both the complexity of commercial risks, and the investment required to program the standards, broad industry support is needed to ensure successful adoption among carriers, vendors and brokers.

The Conference Board ultimately recommended a phased approach, beginning with an inclusive industry effort to define a common strategy for the implementation of commercial lines data standards.

Developing a minimum data set

In summer 2018, CSIO launched a working group focused on advancing the implementation of commercial lines data standards. The working group includes broker representation through the Insurance Brokers Association of Canada (IBAC) as well as participation from 12 carriers across Canada:

  • American Insurance Group (AIG)
  • Aviva Canada
  • Economical Insurance
  • Gore Mutual
  • Heartland Farm Mutual
  • Intact Insurance
  • Northbridge Insurance
  • RSA Canada
  • Saskatchewan Mutual Insurance
  • SGI Canada
  • Travelers Canada
  • Wawanesa Insurance

The working group’s objective was to define the minimum data elements that carriers have in common for underwriting commercial packages. This minimum data set is not an industry form, but rather a starting point for carriers and vendors to program commercial lines standards; over the long-term, the data set should reduce future development time, investment and effort industry-wide.

“We see the benefits of data standards in personal lines every day – reduced double-entry, less paperwork, faster quotes, and improved customer service,” says Kim Opheim, broker technology and innovation consultant at IBAC. “In arriving at a minimum data set with the participation of so many diverse carriers, we are one step closer to transforming commercial lines workflow in a similar way for the broker channel in Canada.”

“This working group is a fantastic example of what our industry can achieve when we work together and collaborate,” says Brian Warkentin, assistant vice-president at Aviva Canada. “Data standards will allow us to digitize a number of commercial insurance transactions in the future. The progress we made in a few months has the potential to benefit the entire broker channel for years to come.”

Supporting implementation of standards

CSIO is working closely with BMS vendors to provide detailed walkthroughs of the proposed minimum data set, supporting their efforts and those of carriers to move forward with implementation.

Further, CSIO is establishing a certification program for commercial lines, promoting the efficient, seamless exchange of policy data by recognizing carriers and vendors that have implemented the standards in accordance with industry best practices.

Benefits for brokers

Once carriers and BMS vendors program the minimum data set, commercial brokers should see immediate improvements in their daily operations. Like their personal-insurance counterparts, commercial brokers will be able to perform more tasks in their BMS and develop consistent workflows that apply to different carriers, reducing variation that can lead to human error. Commercial standards will also automate aspects of the underwriting and rating process, resulting in faster quotes – especially for package policies.

The minimum data set will also streamline the commercial eDocs experience by enabling download of basic policy data, creating a client file in the BMS. eDocs will eventually able to automatically attach to the correct file without manual intervention, resulting in further cost and time savings for brokers.

In turn, brokers will be able to serve their customers more quickly and efficiently than before, with policy data and eDocs at their fingertips.

“Having commercial data standards is key, so I’m very excited about the progress made this year,” adds Janzen. “Think of it – the full underwriting information and coverage requirements get loaded to the insurer’s system for review, quoting and response, with no re-keying of data. We should see significant cost savings on submissions for brokers and insurers alike. It’s a real win-win.”

CSIO will continue to collaborate with its members to implement the minimum data set, which will serve as the basis for improving the ease of doing commercial lines business within the broker channel in Canada.