Transcript Electronic Market Reform Contract Endorsements Market Briefing

Market Reform
Group
Electronic Market Reform Contract Endorsements
Sponsors and Project Managers - Workshop
28th January 2009
With
Agenda
Market Reform
• Introduction & Background
Page 1
John Muir
• Bi-Lateral agreements
• Current Status & Targets
Steve Hulm
• Broker & Insurer Responses
• Workshop
• Conclusion
ALL
Reforming endorsements: a big prize
• For non-complex, non-urgent, low value to client but high
Market Reform
admin cost
– Approx ½ million endorsements p.a.
• Faster agreement process
• Frees brokers and underwriters to do something more
useful
• Agreed endorsement is basis of client documentation
– Improved contract certainty
– Saves broker rework
– Documentation to client quicker
Page 2
• Bridgehead into electronic trading
e-MRCE summary: focus is email
Market Reform
• “Keep it simple”
Page 3
– Email is sufficient – new technology is not a pre-requisite
– Use structured data messaging when you have it
– Certainly non-complex, but don’t be afraid to go further
• “Just do it”
– Email widely used for non-London Market business already
– Brokers: extend use of email to your London Market business particularly
for non-complex, non-urgent, endorsements
– Insurers: respond using email
Email Bi-Lateral Agreements
• Whereby a broking team and underwriting team agree to the email
Market Reform
submission of ALL endorsements, within a class of business
Page 4
• Negotiation and agreement can then be via email, or face to face, as
appropriate
• We are developing a “protocol” regarding how this would work
• We will then be seeking volunteers to participate
Current Status and Targets
• Data received from approx. 20 insurers and 20 brokers (including
Market Reform
Aon, Marsh and Willis) each month
• Volume has increased significantly … … but below target.
• Limiting factor = acceptance by front-line brokers and
underwriters?
Electronic endorsements - broker submissions
3000
2500
2000
1500
1000
500
0
Apr
May
Jun
Jul
Aug
Sep
Oct
Nov
Dec
Page 5
Broker electronic submissions
Monthly Interpolated target
Q3 target
Selection of Broker Responses
• e-MRCE provides us with clear benefit …
Market Reform
• … particularly where it means that technicians can communicate
directly with the market (including from outside London)
• We’ve had endorsements agreed in under 5 minutes
• It brings the process for London & Overseas markets into line
• Follow agreements and notifications can be executed in parallel
• Front-line brokers may not be keen
• Individual underwriters may not be keen
• Measurement a chore
• Some prefer to await a structured messaging solution
Page 6
Selection of Insurer Responses
• Our doors are open to brokers that want to operate in this way
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• Brings London process into line with that adopted elsewhere in the
group
• Maintains a record of the agreement
• Endorsements via email can be integrated into our workflow
systems – and hence visible on underwriters’ desktops
• Provides a stepping stone (& benefits case) towards full electronic
support for placing (& hence reduced re-keying)
• Volumes are currently low; measurement a chore
• Supports endorsement agreement by underwriting assistants
Page 7
• Non-standard submissions hinder take-up
Market Reform
Workshop Questions – by show of hands
Page 8
1.
Is e-MRCE providing benefit today?
2.
Does email act as a stepping stone to support for placing via
structured messaging?
– Addressing the cultural issues?
– Providing experience and the basis for a benefits case?
3.
Do you think that your organisation would participate in Bi-Lateral
agreements?
– For 100% of endorsements, within specific classes/teams
4.
Question(s) from the floor?
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Workshop Questions – breakout groups
Page 9
For INSURER representatives:
•
How to promote front-line underwriter acceptance?
For BROKER representatives:
•
How to ensure (broker) adherence to agreed e-MRCE standard?
Conclusion
• Thank you for coming … and for participating
Market Reform
• Watch out the announcement of bi-lateral arrangements
Page 10
• I will be meeting with as many of you as possible over the next few
months to gain your input … in the meantime
• We are very open to individual suggestions and comments
regarding the issues raised today
Email: [email protected]