The Insurance Brokers Association of Canada (IBAC) has announced the results of a study, which reveals that there are tangible benefits to the connectivity of application programming interfaces (API) between insurance brokers and carriers.
Presently, brokers and carriers use their own separate systems to manage transactions; brokers first enter client data into their own broker management systems (BMS), and then must re-key the same data into the carriers’ portals. This redundancy, IBAC explains, causes delays and data quality issues, and ultimately impacts the client experience negatively.
API technology will allow data transmission in real-time and eliminates the need for double entry. IBAC itself has led efforts for this connectivity with its IBAC Data Exchange (DX) initiative in 2018. The association later joined forces with CSIO INNOTECH in 2021 to further enhance the exchange through the development of APIs.
“Other industries have made great headway in real-time data sharing, but the insurance industry is lagging behind,” said IBAC DX lead Tom Reid. “To ensure that the broker channel remains the preferred choice for consumers in Canada, brokers and their insurance carrier partners need to up their game in this area. That’s why IBAC and CSIO are working together to improve this through adoption of API connectivity.”
To prove its point that API connectivity has clear benefits for both brokers and carriers, IBAC commissioned a study which analyzed the effects of adopting APIs into brokerage operations, by focusing on two of CSIO’s priority transactions for 2022 – personal lines quotes and personal lines policy changes.
For personal lines quotes, the study found that connectivity dramatically increased the accuracy of insurance broker quotes. Currently, over a third of quotes provided to clients do not match the price in the carrier portal. But with connectivity, this inaccuracy becomes a non-issue. IBAC noted that improved accuracy saves more than 10% of the time taken to quote, saving time for both brokers and clients. Meanwhile, the start-to-finish duration of a quote was reduced by almost half.
Personal lines policy change transactions also saw marked improvements when API connectivity was implemented, the study said. Enabling brokers to make client changes in their own system without double entry saved as much as 40% of the work for the broker, while reducing client wait times by the same amount.
“IBAC has an important role to play in raising awareness of work that is being done on broker connectivity and encouraging brokerages to adopt API technology into their own business practices,” said IBAC CEO Peter Braid. “The more friction and duplication we take out of the insurance broker channel, the more that the insurance broker’s true value can come to the forefront – professional advice, choice and advocacy.”
Last September, IBAC unveiled its new executive and board of directors for 2022/23. Robyn Young, from Alberta, was named chair of the executive committee, with British Columbia’s Linda Dolan named president. Meanwhile, Traci Boland, of Ontario, will serve as president elect, with Mathieu Bruneau from Québec and Brett McGregor from Manitoba were named vice presidents.