market reform office market reform forum andy brookes, mro jon faulkner, xchanging helen dines,...

Market Reform Office

Market Reform Forum

Andy Brookes, MRO

Jon Faulkner, Xchanging

Helen Dines, Willis

Thursday 25 October 2007

Mark

et

Refo

rm

Market Reform Update

•Developments in the past month

•Upcoming work and plans

•Special topic – Electronic Policies

–Jon Faulkner, Xchanging

–Helen Dines, Willis

Mark

et

Refo

rm

Contract certainty - Headlines

• Performance continues to exceed 90% target – August brokers’ achievement rate – 96%

• …..in line with managing agent (93% Sept) and company data (97% Aug)

Overall Contract Certainty achievement

80%

90%

100%

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

Broker CC rate MA CC rate Company CC rate

CC MRG target

Mark

et

Refo

rm

Contract Certainty Survey - results

•Key message: “Improvement and, crucially, no deterioration in a year of less intensive regulatory scrutiny”

•Key stat – the proportion of firms which regard their systems and controls for achieving Contract Certainty to be either ‘embedded’ or ‘very well established’ in their business as usual operations up to 83% from 74%

•168 firms responded (163 last year)

Mark

et

Refo

rm

Contract Certainty: Systems and Controls% of firms: total market

3% 6%8%

39%

44%

Substantially underdevelopedUnderdevelopedWell establishedVery well establishedEmbedded

Mark

et

Refo

rm

Contract Certainty – next steps

•Play back survey results to FSA

•Propose end to central measurement from end 2007

•Down to individual firms to demonstrate performance to the regulator when asked…

Mark

et

Refo

rm

Legacy

• Lloyd’s index currently 37% September

• IUA 41% August

– Ahead of year end target; but do not stop

Legacy Index

0

20

40

60

80

100


Lloyd's Index Interpolated quarterly target

Quarterly target Company market index

Mark

et

Refo

rm

Legacy in 2008

•Need approach to deal with residue

•Cases where “current documentation prevails” is the best answer

– Insufficient counter parties still in existence

–Live claim in progress

–Little potential for a claim

•Client’s requirement rules

•New ‘Principles and Guidance’ (2 pages) with FSA

•Published shortly

Mark

et

Refo

rm

Market Reform Contract

•New “slip” standard published in June. Mandatory in Lloyd’s market from November 1

•Q&A from market sessions and from issues raised with Associations on MRPO website

•Binders and Lineslips

–Working on any required changes

–Unlikely to be mandatory before 01/01/08

Mark

et

Refo

rm

ECF•Lloyd’s ECF take up

–Behind run rate, but substantial progress

–45% of in scope Lloyd’s claims (4 week average to end Sept)

–Over 50% in October

Lloyd's ECF proportion of total in scope new claims

0%20%40%

60%80%

100%


Lloyd's ECF proportion Interpolated quarterly target

Quarterly target

Mark

et

Refo

rm

ECF

•Rollout

–All Managing Agents open for all business

–48 brokers live (80% of total volume), listed on website

–Further 45 to be added by end 2007 (98% of volume)

–© 20 IUA companies live or going live

•LMBC to distribute data to brokers on their take-up

•Managing agent data available from Lloyd’s FPD

Mark

et

Refo

rm

ECF : Live issues• Prioritising Phase 7 changes

– Aim to get all new claims in scope

• Access Control List

– Work arounds available from late November

• IUA changes

– Eg Flag in Company Market CLASS : “using IMR for this claim”

– Late November live

• Contract for IMR use

– Getting sorted, but still slow

• Best practice workshop

– will publish tips; contact [email protected]

• Operational standards being developed

Mark

et

Refo

rm

ECF – how to drive up usage in your firm…

Mark

et

Refo

rm

Accounting and Settlement

•A&S use of IMR: rising but still disappointing

•25% electronically 4 weeks to mid October

–should have been 60% in September

–Over 30% most recent week

•36% of Original Premiums

–APs more difficult if OP was in paper

•80 firms now ‘switched on’ (90+% of total volume)

•Plan for end of OP van service for A&S 1/4/08

•Phase 3 MAT in progress

–Proportional treaty, ACL work arounds

Mark

et

Refo

rm

A&S electronic submission as proportion of total

0%

20%

40%

60%

80%

100%


A&S electronic proportion Interpolated quarterly target

Quarterly target OP only electronic proportion

Mark

et

Refo

rm

A&S Delinking

• Slightly below target ( >60% by end Q3) at 56% but seasonal…

• MRG reviewing ‘end date’. Includes addressing any blockers.

• Brokers receiving individual reports on delinking performance

Delinked rate

0%

20%

40%

60%

80%

100%


Delinked rate Interpolated quarterly target Quarterly target

Mark

et

Refo

rm

Delinking – year on year comparison

0%

10%

20%

30%

40%

50%

60%

70%


2007 Delinked % 2006 Delinked % 2005 Delinked %

Mark

et

Refo

rm

Electronic Placement

• LMA Bulletin issued on 16th August (via Associations or see www.the-lma.com)

• Electronic Placing Steering Group in place

• LMA have developed a briefing pack for all interested participants

• Peter Holdstock

– 020 7327 8383

– [email protected]

• Rob Gillies

– 020 7327 8377

– [email protected]

Mark

et

Refo

rm

Other news…

•MRG chair – Stephen Matanle from Jan 2008

•MRG developing plans for 2008

– Welcome input

– Email [email protected]

• ‘Beginners’ sessions scheduled

•Want to talk…?

– General reform updates/discussions

– Specific topics – MRC, IMR etc

– Email [email protected] to arrange

market reform office market reform forum andy brookes, mro jon faulkner, xchanging helen dines,...

Documents