Reinsurance trading exchange RI3K has launched an automated settlement system that aims to reduce industry payment times dramatically.

The exchange is intended to help the $140bn (£98bn) reinsurance industry make efficient use of the huge amounts of reinsurance capital that flow through the market.

It will allow brokers to manage contract placement without processing payments that flow directly between cedants and reinsurers.

The system automatically nets off between premiums and agreed claims and delivers full reports to users' accounting departments.

RI3K said the system would minimise the risk of human error and allow cedants to retain funds until the settlement date.

RI3K chief executive Alex Letts said: "We are sending a clear message to the reinsurance industry that we intend to play a lead role in accelerating cash flow to increase liquidity and make settlement as per agreed terms a reality.

"Cash flow, forecasting and credit control is now even higher up the industry's agenda."