Groupama Personal Insurances has said it plans to move to a fully automated EDI system for all new private car insurance from January 1, 2001.

The insurer stressed that only a minority of its 6,000 agents are likely to be affected because 80% of its new private car business is already conducted using full-cycle EDI.

Groupama Personal Insurances' sales and marketing manager, Lloyd Hanks, said only eight brokers had written to express disapproval. He said, however, that Groupama had given those remaining brokers eight months' notice of its plans and was willing to work with them to purchase EDI software.

The news follows Allianz Cornhill's decision last week to slash commission rates on some motor products to 10% for brokers who are still using paper-based systems to process product information.

Groupama said its decision to only transact new private car business on a full-cycle EDI basis was prompted by increasing competition.

It describes the shift as the first in a series of steps to fully exploit ecommerce that will improve efficiency and reduce costs.

Hanks said: "The move to full-cycle EDI means a faster and more efficient service for our customers, with quotes and policies being kept accurate and up to date."

Yet, he emphasised that the initiative should be seen as a clear commitment to Groupama's traditional intermediary channel.

Some brokers will be unaffected by the switch to full-cycle EDI, although these will be intermediaries who already have existing ecommerce arrangements with Groupama.

Hanks warned: "Rapid technological changes mean that the industry cannot stand still and must continually push back the barriers."

The insurer, he said, is actively exploring other ecommerce solutions with its broker partners.