If the politics and petty-mindedness within the franchise are allowed, they will strangle the correct strategy formulation
Kinnect appears to be in transformation under new management in the form of the mercurial Iain Saville as chairman, and Toby Davies as chief executive.
What Kinnect is, and what the new team wants it to become are, I think, quite different things. Currently Kinnect seems to be a series of screens that allows a broker to trigger the passing of direct property insurance data files from a broker's back-office to the back-office of an underwriting agency. This would save time on re-keying and eradicate a good percentage of errors.
However, one hopes that in the re-planning of the Kinnect strategy and from the published comments of Iain Saville, the ambition is now somewhat more dramatic. With the need for contract certainty, auditability and better processes, the picture for Kinnect should expand. With any luck it may re-emerge as being much more about capturing the placement process electronically, with a longer-term move towards electronic policies-on-inception for commodity-style business.
All of this is entirely feasible and, in our own labs at ri3k, we have looked at working prototypes of such stuff. Most importantly though, the vision must embrace a far more sophisticated data exchange with systems messaging each other back and forth through the process. At ri3k, we have implemented the same thing on the reinsurance side. It works and it is a necessity.
Does Kinnect's new strategy therefore compete with ri3k? While ri3k is a working system for reinsurance, Kinnect targets insurance. And ri3k is some way ahead of Kinnect in terms of maturity and acceptance. Already over half a billion dollars of premium business has passed over ri3k and only a couple of risks have been said to have passed through the Kinnect system. Equally, ri3k handles the accounting and financial message, which is not the case with Kinnect. But in terms of perception, there is always confusion in the industry about who does what, so the noise around Kinnect and ri3k impacts negatively on both.
So can Kinnect succeed? It has never had a better chance than under the new management, but that management is only as good as its shareholders will allow it to be. Frankly, Lloyd's is drinking at the Last Chance Saloon. If the politics and petty-mindedness of the numerous voices within the franchise are allowed, they will strangle the correct strategy formulation.
This will end Lloyd's participation in the electronic arena, probably for good, as the money burnt will hurt for years to come and will impact on Lloyd's long-term prospects. If they let the Kinnect team get to work, success can be found, but it will require some inspired thinking, clever marketing and above all else, brilliant, stable, scalable technology.
