14 September 2014 Insurance

Time for change

Building   upon  a  technology   base  which 
can currently  be seen within  the London Market, Netsett—a strategic partnership between   Deutsche   Bank  and   Xchanging—can  substantially  increase  both  efficiency  and accuracy  for insurers.

Providing global accounting and net settlement through   the  use  of   structured   data,   Netsett facilitates  the  transfer  of  claims  and  premium data  both  within  global  insurance  groups  and between global cedants, brokers and carriers.

“We’ve taken part of what we do in London and re-platformed it to make it work globally,” says Max Pell, managing director  of  Xchanging’s  UK Insurance Business.

“It’s   been  a   long   journey   but   we   saw increasing   opportunity   to  take   this   to  the global  market,  we  also  saw  that  there  were global groups, such as Ruschlikon, which is the collection of the world’s largest reinsurers, as a helpful community  to help us understand  and build value for this market.”

Duffy adds: “Netsett  is a  global  utility  that  offers two things  to the  insurance  industry. By  offering  the  back  end  to  e-accounting, users can  obtain  both an accounting  and  net settlement resource in one place.”

While   e-accounting,   which    enables    an insurer’s financial accounting function and broker to reconcile, is already in place for many insurers, they still have to go through a manual settlement process, which doesn’t offer netting  of  different transactions between market participants.

“Netsett plugs into the existing accounting process and provides the netting and settlement pieces in an automated function,” says Duffy.

Pell adds: “The reduction in working capital requirement is about 80 percent, and we have proven this in the London Market over the last 15 years.  As we  move  from a  period  of  low interest  rates  to  high  interest  rates  the  value of  that  netting  becomes ever greater,  because there’s either an alternative use of that cash, or the company is funding that cash by having  an arrangement with the bank.”

A completely unique offering, Netsett is state of the art and doesn’t currently exist within the industry, as Pell explains.

“By  using  Pega technology,  the system can easily be updated; it’s modern and very  easy  to  configure  which  allows  change to  be  made.  The technology   isn’t complex either. Netsett acts as a glue using ACORD standards, allowing lots of different people using different systems to find a common language,” he says.

Remaining relevant

The partnership of  both Deutsche  Bank and Xchanging has played an important  role in the development of Netsett.

“Working with a technology company such as Xchanging that sits at the heart of the London insurance market and is fully integrated with the market’s plan for modernisation; and on the other side, Deutsche Bank, which is one of the leading transaction banks in the world and the leading cash management house in Western Europe¹, has allowed us to develop this innovative solution,” says Duffy.

Bringing integrity and accuracy to the claims process, the platform operates on a global basis, and via multiple currencies, making it an ideal solution for global corporates.

“Netsett can benefit re/insurers all over the world as it’s not designed for any one country or any one region,” says Duffy.


Implementation of Netsett can take as little as two to three months, but as every company has different internal challenges and systems, times can vary between clients.

“While we will be working to a two to three month implementation process, we first have to work with the insurer to figure out the depth of the IT consideration,” says Duffy.

Pell agrees. “Making sure that  the client has a project team lined up and mobilised to take on the onboarding is the biggest challenge. We either need an ACORD  file or a  standard  data  file, which requires the client to do some IT work to produce the file that will be used by the systems.

¹ Euromoney Cash Management Survey, 2013

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