ACORD Subcommittees Approve Adoption of XML Insurance Transactions

Through the ACORD standards-setting process, both Property/Casualty and Life subcommittees have voted to adopt the first insurance industry standard XML transactions.

Called ACORD XML for P&C Insurance and ACORD XML for Life Insurance, the transaction standards adopted have been developed through a cooperative process involving hundreds of organizations from the insurance and related financial services industries. ACORD XML is based on existing ACORD standards, thereby easing migration to XML, a cross-industry e-commerce standard for business-to-business and business-to-consumer transactions.

ACORD says its XML initiatives focus on defining a set of standards detailing interfaces, data, and error processing relevant to insurance business functions. These standards enable real-time exchange of information and integration of systems used in day-to-day operations for processing insurance. They enable insurance carriers to face the challenge of providing a single set of views or interfaces into their supporting back-end systems.

The P&C adoption includes several XML business messages that enable the real-time exchange of quote and application transactions for personal and commercial lines of insurance over the Internet. Included in the adoption is the Interactive Financial Exchange (IFX) specification, which provides a standard framework architecture to ensure interoperability among multiple trading partners using IFX.

"Our goal has been to bring together two very important segments of the financial services industry. This type of advance thinking in standard specifications will lead financial services into the long-promised era of integrated e-commerce," said Brad Rhodes, insurance industry architect, Microsoft, and member of the ACORD Transaction Review Board. "Microsoft supports the ACORD XML process and continues to work with ACORD and IFX Forum to facilitate integration of these important XML standards in the financial services industry. It is our hope that the leadership demonstrated by ACORD and IFX Forum will encourage other financial services segments to pursue a common set of XML standards."

ACORD notes that, although the strength of the standard is embodied in the robust specification and framework, the success lies with the people and organizations involved. The ACORD P&C Transaction Review Board has provided business leadership and technical expertise from organizations such as PMSC, The Hartford, AMS, Travelers, Microsoft, SAFECO, IVANS, National Grange Mutual, Applied Systems, Ontos, and Symmetry Technology Labs.

"The speed of the ACORD XML standards process can be attributed in large measure to the institutional knowledge already imbedded in existing ACORD standards and to ACORD's strategy to leverage that knowledge in developing the new XML standards," said David Price, director, IT Architecture at The Hartford and co-chair of the ACORD TRB. "Speed is important to The Hartford, since we're aggressively pursuing an e-business strategy that incorporates the new generation of ACORD standards. Our new e-business capabilities will help make our independent agents more competitive as a distribution channel and enable them to provide important value to our customers."

Currently several other working groups are developing additional transactions for use in the insurance industry and in dealing with trading partners.