A crucial distinction arises when a company outsources critical development tasks to third-party vendors, writes Peter Smyth, vice president, Ebix Europe.

Peter Smyth

To be a technology company, or not to be a technology company, that is the question: whether ’tis wiser for a company to endure the slings and arrows of lacking in-house expertise, or to take arms against a sea of challenges, and develop their own solutions…

OK I’ll stop. But the point I’m making is that the prevalent practice of outsourcing product development in the technology sector is a matter of global debate, above and beyond our London market sphere.

Can a company that does not employ in-house technology developers, and has no commercial technology expertise at board level, really call itself a tech firm? When does a company claiming to be a technology-focused entity diverge from the essence of technological innovation?

Recent developments in the London market electronic placement sphere have prompted a critical examination of the nexus between technology companies and their operational methodologies.

Following the newly revealed infusion of £30m ($37.8m) by Lloyd’s into one of the London market’s placement platforms, amidst preparations for yet another round of corporate restructuring, questions are being asked about the fundamental ethos of technological advancement and execution within the industry.

To my mind, the heart of the matter lies in distinguishing between companies that genuinely embody technological prowess and those that merely pay lip service to it. A crucial distinction arises when a company outsources critical development tasks to third-party vendors, perpetuating a cycle of reliance on external partners, and hindering the cultivation of focused, expert internal insurance-specific technical skillsets.

Persistent criticisms of the London market’s slow adoption of true electronic trading echo sentiments prevalent in industries that embraced digitisation long ago. However, the complexities of commercial and specialty insurance risks defy easy categorisation into standardised data elements. Nevertheless, the growing demand for real-time data underscores a shift toward a “data-first” approach, prioritising digitisation and standardisation.

As the market continues on this transformative journey, collaboration is of course crucial for success. The symbiotic relationship between Blueprint Two and software vendors is paramount, requiring detailed engagement at the operational level. Effective collaboration promises to unlock efficiencies and drive innovation, while failure risks squandering the momentum gained from past modernisation efforts.

What, then, constitutes excellence in this evolving landscape? The features that the market is demanding from electronic placement platforms are simple to summarise: a seamless user interface delivering functionality the user needs, lightning-fast response times, guaranteed uptime, cost-effectiveness, and responsive support staff well-versed in specialty insurance.

So why are these essential benchmarks so difficult for some vendors to achieve? Achieving these goals necessitates the expertise of a genuine technology provider committed to delivering sustainable and reliable solutions to its customers.

Authentic technological innovation will deliver the above, seamlessly. For me, servicing the London market with a platform it needs and deserves involves a steadfast commitment to evolution rather than revolutionising core competencies time and time again, and working with genuine technology companies that prioritise reliability, user-friendliness, and fair value, drawing on extensive experience in the insurance sector.

This discussion surrounding the identity of technology companies transcends mere semantics. It underscores the importance of nurturing internal technical expertise and fostering a culture of innovation in our market, and you can’t outsource that.

In essence, what sets apart a truly innovative market system is not just the technology itself, but the deep understanding, experience and integration of technological solutions into the fabric of operations.

It’s about embodying a culture of innovation and technical expertise, fostering collaboration, and delivering solutions that meet and exceed market expectations. Only by embracing these principles can the London market truly thrive in the era of electronic placement and digital transformation.

By Peter Smyth (pictured), vice president, Ebix Europe.