Transcript Slide 1
Accounting & Settlement: Progress and Plans Mark Barwick, Project Manager, LMBC Agenda 1. What has been achieved to date? • PAPER • LONDONISMS • SPEED • ACCURACY 2. What happens next? • STANDARD PROCESSES • ACORD MESSAGES • QUALITY ASSURANCE 3. Summary 4. Questions What has been achieved? 2 years ago the key challenges facing brokers were: • PAPER – Cost of moving, storing and producing – Premiums – Policies • LONDONISMS: – Non-Fundamental Accounting Splits – Involuntary funding of deferred premiums – Delinking • SPEED – Time taken to process queries • ACCURACY – Rework and reconciliation PAPER - Premiums: What’s happened? As of 25th January 2008 115 broking firms are live on A&S Represent 95%+ of all bureau transactions Approximately 27 brokers currently implementing Four of the key broker software houses have built DRI solutions W/C 14th January - 71% of all original premiums now processed via A&S What happens next? 100% usage - see later slide PAPER – Policies: What’s happened? Initial A&S implementation returned policies as paper documents Legal issues overcome Successful pilot held with Willis 30 Brokers live and 7 more registered or testing 17% of policies now electronic What happens next? Target is to connect all brokers during Q1 2008 MRG 2008 Roadmap target 80% all policies electronic LONDONISMS - Accounting Splits: What’s Happened? Successful Pilot held by Marsh and Xchanging; 250 contracts + Broker creates splits at fundamental level only and Xchanging preprocessing team add the non-fundamental splits Xchanging sign in the normal way – BSM as today What happens next? Service proposal being discussed with Xchanging Review Boards Broker Signing Message (BSM) to be sent at fundamental level* Development of fundamental level settlement trigger system* Rollout to other brokers How will claims be attached to an OSND? LONDONISMS – Deferred Premiums: What’s happened? Premium Payment Working Party produced report Lloyd’s/IUA and LMA involved Removing mandatory funding of deferred’s a recommendation Way forward agreed – linked to mandatory delinking What happens next? Two solutions being evaluated – “Instalment APs” or “Deferred with right of cancellation” Premiums will move on due date unless broker hasn’t been paid and chooses to stop the premium LONDONISMS – Delinking: What’s happened? Delinking enhancements identified Q2 rollout target 40% – Achieved Q3 target 60% - 55% Achieved Q4 target 80% - 55% What happens next? Review scope of delinking – is it correct? Secure funding for delinking enhancements Implement delinking enhancements 100% usage during 2008 ACCURACY: What’s happened? • Stage One Accounting checks documented and published • “Right first time” project sought to reduce Stage One errors • Project IT requirements could not be met • Revisit requirements as part of Xchanging project to retire Tracker and replace with new method of query-capture What happens next? • Resubmit requirements for inclusion in Xchanging workflow system development plans for 2008 What happens next? • STANDARD PROCESSES • A&S for all transactions • ACORD Messages • ELPAN2 • EBOT • QUALITY ASSURANCE • Current A&S initiative • Right first time • ELPAN2 STANDARD PROCESSES: How do we stay ahead? • A&S Release 4&5 planned in 2008 – Usability enhancements • Mandatory usage by 1/4/08: – All Original premiums relating to open market Direct, Facultative, Excess of Loss and non-bulked declarations presented to Xchanging – All FDO signings for lineslips and Binding Authorities – Subsequent APs and RPs on Binding Authorities/ Lineslips/open market contracts where the OP or FDO was signed via A&S. STANDARD PROCESSES: • Out of scope of 1/4/2008 Mandatory usage: – DRI only – transactions which require different access control to that currently provided in the IMR as standard. E.G. Aviation Vertical placements, Mid term market change, Mid term change of handling broker, multi-section slips with different markets per section. – APs and RPs on contracts where the OP was processed on paper. – All Treaty FDO’s and Treaty Balance statements. – Any premium transaction requiring simultaneous settlement where the claim transaction is out of scope of ECF. – Lloyd’s Outward Reinsurance – This should continue to be processed via LORS. ACORD MESSAGES: How do we stay ahead? • 2 projects exist. ELPAN2 and EBOT • Both will deliver Technical Account & Financial Account (TA+FA) messages from broker to insurer • EBOT Initiative being led by Guy Carpenter on behalf of LMBC Broker Strategy group • ELPAN2 pilot broker is Aon, Marsh also building • Brokers involved – Aon, Benfield, Guy Carpenter, JLT, Marsh, Miller, Willis ACORD MESSAGES – ELPAN2 How do we stay ahead? • Covers Lloyd’s syndicates and IUA companies processing via Xchanging • Messages sent to Xchanging for central processing • Insurers receive existing signing messages (USM/CSM) • ACORD Messages at fundamental split level only • Phased delivery Phase 1 (December 2007) = TA + Delinking Phase 2 ( Q2 2008) = TA + FA Phase 3 (Subject to demand) = Proportional Treaty ACORD Messages – EBOT How do we stay ahead? • A global project, not just London • ACORD Messages from Broker to individual carriers on a P2P basis • European Carriers live - Frankona / Swiss Re, SCOR • US Carriers live – Axa Corporate Solutions, Converium, Federated, Reliance Insurance Company, SCOR Re, Shelter Re, Transatlantic Re, Trenwick America, XL Re America • Other Carriers engaged – talking to significant number of Bermuda companies QUALITY ASSURANCE Current A&S initiative • A&S has changed some working practices • A&S “SP&P” equivalent being developed Right First Time • Integration of Stage One accounting checks into Xchanging premium processing • Periodic query reporting based on Stage One checks ELPAN2 • Of 350+ Stage One checks, 200 are based on slip terms • ACORD TA and FA data can’t perform these 200 checks • Potential to develop Wordsensa checks similar to QA Tool SUMMARY • The market has changed • Market needs to adopt A&S 100% in line with the MRG Target by 01/04/08 • Market needs to adopt delinking 100% in 2008 • More change is coming – ELPAN2 – EBOT Source: LMBC