Ebix Australia MD Leon d’Apice believes IBNA brokers will continue to use his company’s software despite the broking cluster’s multimillion dollar joint venture deal with Melbourne technology company InsuranceConnect.

The joint venture with InsuranceConnect will place IBNA in control of broker management system BrokerCentral, with the joint venture to be known as BrokerCentral. 

But Mr d’Apice, whose company operates the dominant Sunrise Exchange platform and WinBEAT software told insuranceNEWS.com.au today that Ebix is confident a large number of IBNA brokers will resist the non-compulsory switchover to BrokerCentral.

IBNA will not disclose how much it is spending on the new IT infrastructure, but it is rumored to be worth several million dollars.

“We’ve been encouraged by the support that a couple of IBNA brokers have already shown,” Mr d’Apice said. “They have indicated they are not comfortable with the move.

“At the end of the day, individual brokers have to assess what technology platform is right for them. We have invested a significant amount of money to make sure our product is up to date, and I question if IBNA will gain any advantage from buying a competitive product.”

Our Instant News on Friday reported IBNA director Peter Roberts saying BrokerCentral will offer members “substantially improved functionality and workflow efficiencies which could not be found in comparable products in the marketplace”.

“We are excited by the future environment that this joint venture will create for both IBNA members and the broader insurance industry,” he said.

But Mr d’Apice questioned why IBNA “would invest in a start-up technology platform”.

On May 31 insuranceNEWS.com.au reported that InsuranceConnect was negotiating with rival broker cluster Steadfast, but the negotiations were terminated in early July.

“What we have seen over the years is the IT road in this industry is littered with corpses,” Mr d’Apice said.

“It’s a very small market. You have to have critical mass to be viable in the long term, and some of these smaller companies may not have the necessary skills or be prepared to invest the level of funds that is needed.”

InsuranceConnect CEO Andrew Bennett said last week his company had “spent considerable time and effort” analysing alternative options to take BrokerCentral to a broader market.  

He said the joint venture “has the potential to bring about a significant change in the insurance systems landscape in Australia”.