Dutch trading history paves the way for digital revolution


The Netherlands, one of the oldest established commercial and industrial insurance markets, is taking the lead in the digital transformation of the industry.

The recent completion of the Electronic Insurance Exchange System for the co-insurance market provides insurers, brokers and loss adjusters with an integrated online platform with full placement, claims and clearing functionality. The use of this system is compulsory for members of the Netherlands Insurance Exchange Association or VNAB.

No doubt some Dutch co-insurance veterans regret the disappearance of the illustrious exchanges in Rotterdam and Amsterdam. Yet digitalisation is the way forward, according to the VNAB. The online exchange system, as the association says on its website, is designed to anticipate the changing wishes of the market in terms of speed and effectiveness. It aims to raise efficiency and reduce costs, increase transparency and facilitate information management.

Golden age
It all seems a far cry from the physical exchanges, which were linked to Holland's commercial expansion during the Dutch Golden Age (1602-1670). In those days, Amsterdam merchants would settle the insurance of ships and cargoes to the Far East and the Americas on a wide open space, surrounded by Italian style arcades. Maritime risk continued to be the core business of the Dutch insurance exchanges until well into the 19th century. These exchanges closed down with the first phase of E-IES in 2004.

E-IES has been introduced in three phases over the last seven years. Starting with the claims module in 2004 and then six years later the placement module - data interchange from submission to the electronically signed policy. In March this year, the clearing module for financial processing completed the online platform. Integration with the existing systems of both brokers and insurers is facilitated by means of web services.

"The online exchange system is designed to anticipate the changing wishes of the market."

The virtual marketplace

Digitalisation creates a ‘virtual' market place. This will have two important consequences for the industry and the people who work in it. The first is that there is less need to be physically present in the historical markets. The fact that one large broker recently announced its intention to concentrate its specialists in one location, illustrates the point. It also raises the question if, in the long run, brokers and insurers need to have a local presence in the Netherlands at all.

Another major, and unavoidable, consequence is that it reduces face-to-face contact and the sharing of information. The VNAB acknowledges this effect but emphasises that even in the digital age, ‘doing business continues to be peoples business'. The association also encourages other forms of contact, for instance, by organising seminars for its members on relevant topics.

No doubt, the introduction of E-IES will have a major impact on the Dutch co-insurance market and the way in which insurers and brokers operate. Lower transaction costs and increased efficiency reinforces the position of the Dutch co-insurance market and allows it to compete more successfully with markets such as London. It is to be expected that the Dutch example will soon be followed elsewhere.

Ron Verhulsdonck is country manager for Benelux for Ace Europe

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