How to automate bordereaux
You're spending 2 days a month building BDX in Excel. Here's how to make it automatic.
If you're running an MGA, you know the drill. Every month (or every quarter, if you're lucky), someone on your team stops what they're doing and starts building bordereaux. They pull policy data from one place, premium data from another, calculate stamp duty by hand, format everything into the carrier's template, and send it off, hoping nothing's missing.
What goes into a bordereaux
A premium bordereaux typically contains:
- Policy details: policy number, insured name, inception and expiry dates, risk class
- Premium: gross premium, net premium, commission deductions
- Tax and stamp duty: calculated per jurisdiction, weighted across multi-state or multi-territory policies
- Risk location: where the risk is situated, which drives tax calculations
- Participant shares: for consortium or multi-carrier arrangements, each carrier's line percentage and their proportional premium
- Claims data: for claims bordereaux: date of loss, reserves, payments, and claim status
Why manual BDX is painful
The data for a single bordereaux typically lives in three or more places:
- Policy details in the underwriting system (or a spreadsheet)
- Premium collection status in the bank or accounting system
- Claims data in email threads or yet another spreadsheet
Your ops team has to pull data from all of these, cross-reference to determine what's been collected since the last report, calculate tax, and format the output. Every carrier has a different template: different column names, different field orders, different levels of detail required. A medium-sized MGA with five carrier relationships might spend 10 days per quarter just on bordereaux reporting.
And the report is already stale. By the time you've compiled it, more policies have been bound and more premium has been collected. The carrier is making decisions based on data that's weeks old.
Stamp duty and premium tax: the hidden complexity
Tax calculation is one of the reasons manual bordereaux is so error-prone. In Australia, stamp duty rates vary by state and territory; the UK has insurance premium tax; the US has surplus lines taxes and stamping fees that differ by state. A single policy can cover risks across multiple jurisdictions, which means the premium has to be apportioned and the tax calculated for each.
Done by hand that means looking up rates in a table, apportioning premium across jurisdictions, and discovering the errors months later when a carrier or an auditor finds them.
What to look for when you automate it
Approaches differ, and the differences matter more than the feature lists suggest. Questions worth asking any vendor, ours included:
- Is the report current, or a snapshot? Does it reflect what is true today, or what was true at period end weeks ago?
- Does it cover all three bordereaux? Risk, premium and claims, or only premium? Carriers need the risk data for exposure management.
- Multi-jurisdiction tax: are stamp duty, IPT and levies apportioned automatically across jurisdictions, or is that still a manual step?
- One source, many formats: can it produce each carrier's template from the same underlying data without a parallel process per carrier?
- Is every figure traceable? Can you get from a line on the bordereaux back to the transaction that produced it, with an audit trail?
- Written or collected: can it report both, and does it know which each binder requires?
See BBNET's approach on your own data
How we do this is the interesting part, and it is easier to show than to describe. We will run it against a sample of your own book, so you can see what your bordereaux looks like when it is generated rather than compiled.
Book a demo and we will walk you through it.