market reform office market reform forum andy brookes, mro jon faulkner, xchanging helen dines,...
TRANSCRIPT
Market Reform Office
Market Reform Forum
Andy Brookes, MRO
Jon Faulkner, Xchanging
Helen Dines, Willis
Thursday 25 October 2007
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Market Reform Update
•Developments in the past month
•Upcoming work and plans
•Special topic – Electronic Policies
–Jon Faulkner, Xchanging
–Helen Dines, Willis
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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
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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)
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Contract Certainty: Systems and Controls% of firms: total market
3% 6%8%
39%
44%
Substantially underdevelopedUnderdevelopedWell establishedVery well establishedEmbedded
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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…
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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
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Lloyd's Index Interpolated quarterly target
Quarterly target Company market index
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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
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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
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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%
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Lloyd's ECF proportion Interpolated quarterly target
Quarterly target
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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
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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
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ECF – how to drive up usage in your firm…
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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
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A&S electronic submission as proportion of total
0%
20%
40%
60%
80%
100%
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
A&S electronic proportion Interpolated quarterly target
Quarterly target OP only electronic proportion
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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%
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Delinked rate Interpolated quarterly target Quarterly target
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Delinking – year on year comparison
0%
10%
20%
30%
40%
50%
60%
70%
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
2007 Delinked % 2006 Delinked % 2005 Delinked %
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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
• Rob Gillies
– 020 7327 8377
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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