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Archive Stories
Archived stories from 2009

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"Yes we can," network provider promises

A group of leading London reinsurance companies and brokers are planning to revolutionise the industry by introducing a complex network of baked bean cans joined by string. Gnome Re, Mocha Re and Mega Brokers have signed an agreement with the Antwerp based string network provider SPieKUP to cooperate in building the paper-less messaging system.

A simple tin can
messaging system (TCMS)

By April 2053, the project partners want to have a string hub in place that will allow the paperless exchange of information, in a standardized format, between reinsurers, brokers and cedants.

Currently, interaction between players in the reinsurance market is predominantly lunch based. Some players use notes written on the back of menus and old betting slips. As a result, data relating to offering, placing and accounting can be typed many times along the chain by long suffering secretaries before being put in the bin.

The ultimate aim of the SPiekUP reinsurance project, which started out as the String Initiative in late 1907, is to tie up insurer back-offices in business processes that they are too dim to understand. [Are you sure about this? Ed]. Compared to the banking industry the reinsurance business is widely acknowledged to be bogged down by paperwork, incompatible proprietary systems and people just shouting at one another all the time.

Dieter Tekmann, who is in charge of the project for SPiekUP, says the reinsurers involved are determined to improve the operational efficiency of the industry. "It is not simply a question of cutting costs. String is expensive. It is about increasing complexity, slowing down cash flow and reducing claims payment risk, ie the risk of them paying any claims," he says. "We believe that building an incredibly complex web of string around the market will keep string consultants in business for years and at the same time make it look like the market has finally got its act together. It'll never work, but that's the point."

The first step will be to initiate a simple tin can messaging system (TCMS) called Cat's Cradle that allows brokers and underwriters to arrange venues for lunch or drinks in a widely ignored standardized messaging format such as DISCORD.

Tekmann is at pains to explain that there are no plans to put online placing on the system: "You kidding me? What would brokers do in the morning if that happened," he laughed.

Previous attempts at establishing onstring platforms have ended in failure. Lloyd's Kan-Knot-Konnect system was abandoned after companies invested ?400 trillion in it. Similarly, the companies' market StringREon project was wound up (geddit?) after investors got bored.


Other news from Apr 2009
 
Travelating the Wave of Insurability
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