US Property and Casualty Insurance Exchanges: Promises and Perils

Date: January 1, 2011
Pages: 18
Price:
US$ 1,895.00
Publisher: Ovum
Report type: Brief Review
Delivery: E-mail Delivery (PDF)
ID: U06D40408BAEN
Leaflet:

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US Property and Casualty Insurance Exchanges: Promises and Perils
Introduction

Insurance exchanges are not a novel concept to the US property and casualty (P&C) insurance industry. However, the industry is littered with failure after failure of P&C insurance exchanges, specifically commercial P&C exchanges. This report delves into the challenges commercial P&C exchanges have to overcome to succeed in the US.

Features and benefits
  • Discussion of exchanges from a general perspective.
  • Discussion of the five major participants and two critical flows of a commercial P&C insurance exchange.
  • The one critical attribute a commercial P&C insurance exchange must have to succeed in the US.
  • Discussion of what attracts brokers to commercial P&C insurance exchanges.
  • Discussion of the perils which commercial P&C insurers are concerned about and need to be resolved.
Highlights

This report discusses the high-level structure of commercial P&C insurance exchanges, briefly compares three P&C insurance exchanges, and provides recommendations for insurers, brokers, technology vendors, and the management of insurance exchanges.

Your key questions answered
  • What do commercial P&C insurance exchanges have to do to succeed in the US?
  • What are the similarities and differences between three P&C insurance exchanges -the emerging CIAB/L-N exchange, the SeaPass Hub, and InsuranceNoodle?
  • What important lesson does the e-book/e-reader phenomena have for insurance exchanges, brokers and insurers?
SUMMARY

Catalyst
Ovum view
Key messages

EXCHANGES ENABLE EFFICIENT COMMERCE

Exchanges, including insurance exchanges, have existed for centuries
A CPC INEX has five major participants and two critical flows
A CPC INEX must be a risk matchmaker
A CPC INEX can bring true demand and supply into sharp relief
A snapshot of three CPC INEXs

CPC BROKERS ARE ATTRACTED TO A CPC INEX'S PROMISES

CPC Brokers' success is entirely dependent on the health of the CPC insurance market
CPC brokers are looking for financial advantages
CPC brokers do not want to lose control of their clients

CPC INSURERS SEE AN INEX AS A GLASS HALF-FULL AT BEST

CPC insurers are concerned about an INEXs perils

RECOMMENDATIONS

Recommendations for CPC insurance companies
Recommendations for CPC insurance brokers
Recommendations for technology vendors
Recommendations for CPC INEXs
  Encouraging the participation of CPC brokers and insurers
  There are two major sources of revenue a CPC INEX should pursue
  CPC INEXs can not forget the basics
Alternative views

APPENDIX

Further reading
Definitions
Methodology
Author
Ovum Consulting
Disclaimer

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US Property and Casualty Insurance Exchanges: Promises and Perils
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