25 April 2001
I dropped into the City of London to meet with Theo Duchen, joint managing director of a new ASP initiative aimed at the retail commercial broking market. Acturis was due to be press launched the following day where chairman, Sir Brian Pitman, would outline the company's positioning.
Duchen and his co-managing director, David McDonald, are both ex McKinsey and there are a number of ex-Andersen consultants in the team.
I was impressed by the company's approach which was first of all to identify the key reasons why the commercial retail sector was in dire need of restructuring - Duchen outlined the fact that 34% of premiums are being consumed in "frictional cost" and that the industry was relatively inefficient, unprofitable, and did not provide clients with good service.
Acturis has carried out detailed process mapping looking at digital versus manual and some statistics were extremely revealing. 50% of documents going to brokers from insurers were incorrect, and this was still at 30% the second time round. Amazingly, 35% of client documents take over 100 days to be processed. With only 50% of brokers on the internet and only 8% of quotes being transacted by e- mail, the opportunity for streamlining and helping both brokers and insurers to make the segment profitable is certainly there to be grasped.
Duchen sees the service replacing existing systems and he is aiming very clearly at 28 entities of mid-size regional brokers who are looking to expand. He feels that consolidation in the market will escalate once the new GISC compliance and accreditation regime starts to bite. The system itself has taken 100 man years and £1m to develop and Acturis intend to redouble their investment in it assisted by venture partner Nedcor.
The winning formula, according to Duchen, is the right technology, appropriate partnerships (Bland Bankart and Smart and Cook are supporting brokers and Independent and Norwich Union are two of the supporting insurers), innovation (assisting brokers in product development), and talent.
The system will be Polaris compatible when launched next year - Acturis are exhibiting at the BIBA Conference in Belfast this week.
The project has been kept under wraps for some time being known as "RiskLine". The well qualified team have taken a top down view of the market and present with a lack of hype. Newslink wishes them well in their quest to change mind sets and challenge the way things are done.
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