Mike Anstee's analysis of London's insurance technology initiatives (Comment, 13 January 2005: "Kinnect is the problem, not the solution") concludes: "Dis-Kinnect and allow market forces to occupy the placing space".
Uh oh. Dis-Kinnect? You'd have thought the market would have worked out by now that dissing Kinnect is not the issue. If people have a problem with the strategy and delivery of Kinnect, that clearly merits attention. But the issue is not whether to dis-Kinnect, but how best to implement the requirement.
Those eager to 'diss ' Kinnect ignore that Lloyd's has had the vision to try to build an electronic market platform for direct wholesale insurance. Lloyd's anticipated, by a clear three years, the FSA demands for contract certainty, Spitzer carnage, Sarbanes-Oxley implications and Silverstein fall-out. Visionary stuff, or just instinct? No other markets saw it coming but Lloyd's did.
Now Lloyd's understands that the legislative and regulatory clock is in the final phase of its countdown. Unless the market finds a successful implementation of an electronic infrastructure, the future looks pretty bleak. That future is only 717 days from now.
In just under two years' time, on 14 January 2007, the indications are that London will be required to shut down paper trading. Every day that the market carries on carping, the solutions required will become more expensive, and more rushed.
Those solutions, in order, will need to be:
Lloyd's has understood this, and has put its members' money behind the effort to meet the pressing deadline. 'Dissing' Kinnect then is not and never can be the strategy for success. Ensuring that the solutions are right, so that they can be validated over the next 717 days, is the only option.
There is no alternative but to hit the gas pedal and accelerate reform and modernisation. If that means that Lloyd's too is going to need to reflect on how its execution and delivery is progressing, so be it. Kinnect may require adjustment and change, or not, as the case may be, but to "dis-Kinnect" is not the point, nor can ever be. The willingness to ensure that the right solution is in place in 717 days' time must be the only agenda.
Chief executive of reinsurance exchange Ri3k