The Association of British Insurers represents around 450 insurance companies, which between them account for over 96 per cent of the business of UK insurance companies. The Association represents insurance companies to the Government and to regulatory and other agencies and it provides a wide range of services to its members. EDI has become the normal mode of transmission of new policy information in the motor insurance market, and the only way that claims and settlements are handled in the London Market. Databases of information, with appropriately restricted access, are used to share information regarding risks, client information etc.
Insurance is the ideal service to be marketed electronically.
Other products for example books and CD's, still have to resort to traditional methods to actually deliver the product. With insurance there is nothing material to be delivered and the deal can be finalised in a totally electronic transaction. Insurers are becoming increasingly aware of the enormous potential of the Internet as a sales medium. Insurance is increasingly becoming a world-wide market, and in particular the EC Third Insurance Directive has opened up insurance sales across the whole of the European Economic Area. Reasons for this vary.