The Data Black Hole

By Paul Buckle

Following our highly successful Data Black Hole webinar in February, in association with the MGAA, Morning Data conducted a brief survey to gather some viewpoints from attendees. Since the webinar, Lloyd’s recently announced the first iteration of the Core Data Record (CDR), which is a starting point for setting data standards across the London Market. It is this process of agreeing and setting of data standards that will unlock the benefits of a digital market for the whole market and enable the ability for all participants to seamlessly exchange data with each other.  

In the Morning Data survey we found that 82% of respondents felt that the [London] Market, as a whole, was a blocker to data innovation, followed closely by Clients (77%) being a blocker. Of course, in our market, the Client is typically local agents/brokers rather than the end policyholder. This shows that the Market still has a long way to go to remove the blockers to data innovation. The CDR is a start but has a long way to go before really unlocking the value of data and a true digital market.

We can take the Class of Business lists used within the Market as an example of where there is no coherent standard, despite lists being available. In our survey, respondents indicated that there is a mix of different data standards lists being used, including Lloyd’s, ACORD, other third-party lists and some organisations creating their own bespoke lists. Over 76% use multiple lists and/or proprietary lists. This should be one data item that could be set to an agreed standard by now but isn’t.  This use of multiple lists at the present time leads to mapping challenges, if different organisations are classifying their classes of business using different reference lists. To highlight this, let us visualise the Lloyd’s High Level Class of Business list with the ACORD High Level Class of Business List:

The differences are clear, with some items not matching directly and the ACORD list containing more items. This is multiplied with the mix of third party and proprietary lists also being used across the market.  

This challenge is present across all data items, including the use of country codes, with only 59% of our respondents confirming that they use a globally recognised ISO list. Whilst this is more than half, 41% are not using a data standard, which is still a big hole in the integrity of the Market’s data.

Data standards is only one part of the solution but is essential to enable integration effectively. Technologically speaking, integration is achievable now, but there is little point if the Market hasn’t agreed data standards.  

The market needs integration, right? In our survey we discovered that 79% of respondents have to log in to multiple systems to process a bordereau. This alone shows the dire need for data standards and subsequent data integration. Over 50% of respondents manually log on to DDM or other web portals to process a bordereau data. Alarmingly, over 41% are still dependent on email in their bordereaux processes. In most cases, this will not be secure end-to-end encrypted email, but open email to transfer sensitive data between participants.  

We then looked at whether the Market is collecting enough data for delegated authority. 56% of those responding to this question thought it was the right amount. There was an even split on whether the market asks for too much or too little, with 22% voting for each.

However, the issue of the amount of data should begin to become less of a challenge with integration and data enrichment technologies. In our survey, we asked who respondents thought was responsible for providing the complete set of data. Over 55% agreed that there was a shared responsibility across all participants, with 37% agreeing multiple participants were still responsible, and only 7% stating only one of the participants is responsible. 

With a fully digital process in the market, it should make it much easier for participants to enrich data as it flows through the market. Integration with external data sources is one example. Morning Data’s solutions integrate with a number of data sources to make the user experience far easier during the data input process. This includes things like enriching vessel data from the user inputting just the IMO number. Once enriched, this data can pass on to the next participant in the process flow. Other technologies are also available to improve this process, including Artificial Intelligence and Machine Learning, to enrich data.

The Market still has a very long way to go to digitise itself. Data standards have to be at the core of this, so momentum to achieve this must increase. The technology and the data sources are here, so data standards are needed to unlock the real value and for the market to avoid that Data Black Hole.