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SOLUTION PROVIDERS FORUM 25 October 2006 Solution Providers Forum Agenda Introduction -Paul Tuvey Reform Updates -Steve Hulm Contract Certainty-Status -Required data for monthly return -Good practice for recording data ECF and A&S Repository-Status -Adam Stafford -Implementation roll out -Preferred delivery method A&S-Status -Brian Austin -Publication of design -Measurement update ACORD -Roy Laker Future Approach to Communication -PT and RL Open Discussion 2 -All © Lloyd’s Contract Certainty Market Reform • Market performance still ahead of target • Work remaining in three areas: – Quality and robustness of data – Exception reduction – Legacy • Letter to all industry CEOs just gone • 2007 plan in development • Legacy numbers show decline in priority 2 and 3 legacy • Priority 1 still increasing, change request to UPR still to be Page 3 agreed Time line to conclusion of FSA challenge FSA decision making timeline Oct 2006 ID Nov 2006 Dec 2006 Jan 2007 Feb 2007 Mar 2007 Task Name 15/10 22/10 29/10 5/11 12/11 19/11 26/11 3/12 10/12 17/12 24/12 31/12 7/1 14/1 21/1 28/1 4/2 11/2 18/2 25/2 4/3 11/3 18/3 FSA Decision Cycle Market Reform FSA firm visits A form of public statement by John Tiner 14/11/06 CEIOPS Consideration of position Press release/press briefing Public statement Informal discussion with the FSA over template content Template development 8th Jan 07 Formal submission of template to FSA Template agreed by CCSC Heads of Association Week of 12 December HOA plus non London to discuss completed draft template with FSA 16/10 20/11 18/12 CCSC 8th Jan (prov) Formal submission of template to FSA 19/10 30/11 21/12 24/01 22/02 MRG 15/11 CCPB 13/12 Lloyd’s Meetings with FSA Public statements Page 4 CEOs 25th January CEOs meeting conclusion of FSA challenge Meeting where dates are still to be confirmed 25/3 Market Reform Contract Documentation Pilot Page 5 • Contract documentation pilot still running • Broad support for the concept • Limited volumes to date (10-20 contracts) • Slip templates an issue plus general lack of awareness • Work underway to raise awareness & resolve blockers Market Reform Programme Office Electronic Claims Insurer’s Market Repository Update Solution Provider Forum 25 October 2006 Adam Stafford Lloyd’s Business Process & Change Mgt Presentation name 00 July 2005 Agenda Electronic Claims Market Reform • ECF is Live • Why do we need an ECF? • Contractual Framework, Training and Governance • ECF not happening in Isolation • What are the Future Plans? • A&S Latest – Direct Load and Email live/ DRI in MAT • Next steps Page 7 Market Reform Electronic Claims Page 8 ECF is Live ECF is Live Electronic Claims Implementation Market Reform – ECF went live over the weekend of 9th / 10th September – 111 Partnerships operational (across Lloyds and IUA) – Volumes (over 2000 total transactions processed) – + IUA pilot started includes Global Aerospace, Liberty, Markel, Munich Re, Swiss Re, XL, Zurich, Score, Faraday (till Dec 2006) • Project Approach – Big bang hasn’t worked in the past – Partnerships decide to sign up when ready – Early implementers – lessons learnt – BEFIT and ECPG working closely with BP&CM to ensure project success Page 9 ECF Live Project Scope • Electronic Claims Partnerships – Firms decide partnerships by class of business / trading relationships Market Reform – With Lloyd’s and IUA carriers and XCS – MRPO is monitoring progress • New claims and their subsequent transactions – Existing paper based claims (legacy) to be tackled later • System Processes and Procedures (SP&P) – Some areas are currently excluded from scope – February CR’s will address some of these e.g. Binders; Direct Reporting – See SP&P for full list of areas in scope • Base camp – Remember Phase 5 was always meant to be ‘base camp’ – Further improvements will be made Page 10 Market Reform Public Commitment to 100% Target on ECF LiveClaims Electronic Brokers Managing Agents Committed to deliver new claims to Lloyd’s electronically Committed to deal electronically with new claims Aon Amlin Brit Faraday Hiscox Limit Marlborough Benfield Marsh Guy Carpenter Cooper Gay St Paul Traveler’sAdvent Active support from: Glencairn ARB JLT Gallagher Miller Claytons SVB Wellington Beazley Ascot Chaucer Heritage Beaufort Cathedral Willis Page 11 Hardy Current High Priority Issue Electronic Claims Market Reform • Contractual Framework – Needs to be signed up by all participants (ECF and A&S) who wish to use the Repository from day one (brokers and managing agents). – Framework made up of Repository Rules and Xchanging side letter to sign. It is legally binding. – Repository Rules cover important topics, such as:– – – – – License to use and access documents Unintentional disclosure Authentication of users Governance Law and Jurisdiction – Pack to be sent out later once all details are finalised - real drive to get all committed parties to sign up to side letter and rules……… Page 12 Other Immediate Next Steps Electronic Claims • Repository Rules to be agreed and distributed to firms Market Reform • November Release to fix faults (minor) found in Phase 5 MAT. • Continue to ramp up on and support new Live partnerships • Expected delivery of signed-off Phase 6 Business Design into MAT early Q1 2007. • Current live implementations aimed for end Feb – beginning March 2007. • Things change and we won’t have thought of everything • There will be more issues and enhancements Page 13 Claims Infrastructure Strategy Electronic Claims What will the claims infrastructure in the London Market look like in 5 years? – ECIS Group formed included representation from Brokers; LMA & IUA Market Reform – Met between March and June 2006 and drafted the ‘Green Paper’ Page 14 – Green Paper provides a high level end vision (3-5 yrs) for the claims infrastructure in the London Market – Peer to Peer ACORD messaging will be the norm • ECIS Subgroup formed to discuss the end vision in more detail (July to October) • This subgroup drafted A&S Claims Process Flows document (Peer to Peer claims messages) • Describes when the different types of ACORD claim messages will be sent /received • Highlights the implementation issues to be addressed e.g Transition/Legacy • More detailed work will be required by the early implementers of the end vision Electronic Claims Market Reform Update on A&S Repository Page 15 Context - Restatement of overall A&S ObjectivesElectronic Claims • Rationalise and streamline business processes, specifically: Market Reform – Speed up premium and claims payment – Remove reliance on paper – Reduce errors and reconciliation by capturing richer data once – Enable back office rationalisation – Introduce flexibility - process the way the business requires rather than the business being driven by constraints • Implement international standards for the communication and processing of accounting & settlement data (the ACORD XML RLC standards) • Provide a firm base for the future Page 16 Repository Electronic Claims • Broker loads slip, LPANs and supporting documentation to Market Reform repository thereby removing paper (and vans) Page 17 – Three methods: – Direct Load – Email – DRI Message • Carriers can gain access and view and download documents • DRI enabled repository that also enables direct loading and enquiries to: – deliver documents to Xchanging Ins-Sure Services for checking – deliver documents directly between brokers and carriers i.e. in support of non-bureau or P2P processes Repository Benefits and Implications Electronic Claims • Faster turnaround times for documentation since “van Market Reform time” is eliminated. • No “van time” and speedier query resolution means signed lines available quicker • Speedier resolution of queries will reduce the volume of rejections • DRI functionality consistent with ECF. Brokers have options on how to connect, DRI Push, DRI Pull or Direct load (or additionally email for delivery to Xchanging for checking) • Gives insurers access to a copy of the slip and other premium submission documentation in the repository • Carriers can be notified as a slip is loaded on the repository Page 18 thereby allowing signed lines to be communicated sooner, thus allowing speedier exposure management Market Reform Direct Load Page 19 Electronic Claims Market Reform Direct Load Page 20 Electronic Claims Repository Timescales Electronic Claims • Project documentation signed off – on target by end of April Market Reform 2006 • Build time - this is being delivered in three releases • Release 1 – Direct Load and Email Upload – NOW LIVE – Around 2,300 transactions processed since the ‘go-live’ weekend of the 9/10th September. • Release 2 – DRI Functionality – MAT Date – Ongoing at present – Go live Date – November 2006 • Release 3 – Utility Repository Page 21 – 1st Quarter 2007 Market Reform Electronic Claims Page 22 •Questions? Market Reform Programme Office A&S – Publication of Design and Measurement Update Brian Austin / 25th October 2006 Publication of A&S Strategy Design Market Reform • MRG approval to publish now received Page 24 • Business Design and supporting Technical Information with covering letter • Context is three work streams: – Measurement – Insurers’ Market Repository – End Vision Documentation Key Points • Concentrates on End Vision – full implementation of Market Reform electronic processing using ACORD messaging • Deliberately bold • Few caveats why difficult or slow to be realised • Not prescriptive on implementation paths • Optional implementation paths for trading partners to select • Will influence Reform agenda for 2007, including e:placing and e:claims Page 25 Key Issues Market Reform • Use or otherwise of “post placement” message – use of Page 26 such a message will be optional for implementers of P2P framework • Claims processing – documentation illustrates how approach to A&S and claims processing can be consistent with hubs and existing claims schemes • Statistical and regulatory data – Lloyd’s is working with managing agents in this area Use of the Documentation Market Reform • Highlights process flows and message types • Not a formal technical design – it is for each firm to produce their own • Set against the context of the other Reforms, eg IMR LPAN, firms should: – Assess impact on current process and evolve new ones – Investigate message transport mechanisms – Consider document repository interoperability and its implications – Familiarise with referenced ACORD documentation – Develop a clear strategy for business units and systems to improve A&S processes Page 27 A&S Measurement Regime • Sponsored by A&S Project Board Market Reform • Aim to create transparency of today’s paper process • Publish XIS checks as applied today • Capture data from XIS and analyse Market performance eg – de-linking take up, – quality of broker submission, – timeliness, eg unwelcome trends (eg submit close to SDD) • Identify quick wins and educate to improve performance as a prelude to: – A&S implementation proper – Use of ACORD messages Page 28 – Validation at source in broker systems Checks/Procedures Publication Status • All Lloyd’s checks published except for detailed overseas Market Reform checks • Lloyd’s Tax rules published • IUA checks readied and awaiting sign off • IUA Tax “mat” ready for publication • LPAN completion guide published • Work on education material for accounting splits being prepared Page 29 Reports Status • First graphs and tabular data received from XIS and Market Reform to be published on MRPO web site Page 30 • Regular monthly updates will be added • Dialogue between IUA and XIS for company market reports begun • Graphs will include: – XIS query and rejection percentages – source of files eg Repository, E:LPAN2 etc – Common areas of failure ACORD Presentation to Solutions Providers October 2006 ACORD View of London Roadmap ACORD View of London Roadmap GOALS Introduce greater efficiency to London market processes Straight-through-processing Improved data quality Increased data quantity / availability Improve the service experience for clients Increased certainty and transparency Faster turnaround of assets and payments Grow local and international business opportunities Develop a scalable infrastructure capable of supporting next tier of business benefit “Start small and grow” rather than a “Big Bang” change ACORD View of London Roadmap TRENDS Increased regulatory pressures nationally (FSA, Lloyd’s franchise standards) and internationally (SarbanesOxley, Spitzer) Downwards pressure on costs, leading to outsourcing, off-shoring and consolidation An acceptance that technology can support the business process(es) Emergence of e-business initiatives – Placing, Accounting & Settlement and Claims London-based firms establishing a presence in Bermuda Increased overview and measurement of market participants’ performance in key areas of client care and efficiency ACORD View of London Roadmap ENABLERS A consistent international business process Reduce “Londonisms” International data standards for common business messages A robust, standards-based, messaging infrastructure (AMS, DRI), scalable for future needs (AWSP, Web Services, SOA etc.) Continuous assessment of market performance measurements ACORD View of London Roadmap ISSUES Achieving standardisation of processes Achieving market consensus Managing transition from pure bureaux-based processing to a mixture of bureaux and direct processing Nervousness in capital investment for centralised technology Legacy systems / lack of systems Alignment of implementation priorities ACORD View of London Roadmap SUMMARY Improve client service Make London easy to do business with – seamless, simple, fast & compliant Make London more cost-effective Ensure infrastructure is scalable Automate processes Ensure regulatory compliance and best-practice are designed in from the outset Highly standardised processes and technologies Flexible to allow for “bespoke” nature of business ACORD View of London Roadmap Key flows Pre-placement Placement Quotation, Binding, Wordings Administration Checking, accounting And settlement Post-placement Endorsements, Renewals, Wordings, Cancellations... Claims Client/Cedant Broker Re/Insurer Bureaux Services Straight through process - simpler, faster, compliant Availability of data Key challenges Regulatory challenges, Contract certainty Multiple distribution channels Proliferation of propietary placing solution Multiple distribution channels Quality of service Reaching agreement on a single claims process Paper-based Consistency of standards and re-use of data Change agents/ Focal point of change Measurement Better client management Measurement Faster cash settlement Improved service for client Measurement Improved efficiency/ simpler claim mgmt Client demand Franchisor claims standards Phased, pragmatic approach – start small and grow Market tested and approved Leveraging existing assets Building a robust, scalable framework for the future Approach Technology - Today Measurement Regulatory pressure Business drivers: Improved efficiency CRM systems Risk modelling tools CRM systems Risk modelling tools, Proprietary placing systems, Hub solutions, Document Management Systems, Wordings database London EDI CLASS / London EDI Document Management Systems Document Repositories, AMS, DRI, Web Services, SOAP, XML Technology - Planned ACORD Placing message & GPD Enhanced Wordings Database Technology - Desired Future State Easy access to risk and claims data for better analysis Comprehensive ACORD Placing message ACORD Technical Acct & Financial Acct messages ACORD XML Technical Account & Financial Account messages CLASS update ACORD XML Claims Movement message Technical Account & Financial Account messages ACORD’s Key Projects for London Document Repository Interoperability Placing Implementation Guide Global Placing Document Key Challenges Key challenges Preplacement Availability of data Placement Postplacement Regulatory challenges, Contract certainty, Multiple distribution channels, Proliferation of propietary placing solutions. Consistency of standards and re-use of data Admin Regulatory challenges: SarbanesOxley/ Financial Reporting Claims Change Agents / Focal points of Change Preplacement Measurement, Better client management Placement Postplacement Measurement Regulatory pressure Business drivers: Improved efficiency Admin Measurement, Faster cash settlement, Improved service for client. Claims Measurement, Improved efficiency/ simpler claim mgmt, Client demand, Franchisor claims standards. Approach Preplacement Placement Postplacement Admin Phased, pragmatic approach – start small and grow Market tested and approved Leveraging existing assets Building a robust, scalable framework for the future Claims Technology CRM systems Risk modelling tools DESIRED FUTURE STATE Placement Postplacement CRM systems Risk modelling tools, Proprietary placing systems, Hub solutions, Document Management Systems, Wordings database Admin London EDI Claims CLASS / London EDI Document Management Systems Document Repositories, AMS, DRI, Web Services, SOAP, XML PLANNED TODAY Preplacement ACORD Placing message & GPD Enhanced Wordings Database Easy access to risk and claims data for better analysis Comprehensive ACORD Placing message ACORD XML Tech Acct & Fin Acct messages ACORD XML Tech Acct & Fin Acct messages CLASS update ACORD XML Claims Movement, Tech Acct & Fin Acct messages Projects Phasing: Placing Placing Phase 1 Phase 2 Simple ACORD Placing message 1-way messaging More detailed ACORD Placing message 2-way messaging Phase 3 Phase 4 Endorsements, renewals, and cancellations. Comprehensive ACORD Placing message and all related business flows (endorsements) Common End Vision - All parties involved - All processes fully automated - ACORD RLC messages - Enables remote working but does not impose it Projects Phasing: Accounting & Settlement Phase 1 Accounting & Settlement Repository functionality London EDI Phase 2 ELPAN 2 Phase 3 2-way messaging, ACORD Technical Acct ACORD Financial Acct Phase 4 “Strategic” A&S Common End Vision - All parties involved - All processes fully automated - ACORD RLC messages - Enables remote working but does not impose it Projects Phasing: Claims Claims Phase 1 Phase 2 CLASS in Companies’ Market Lloyd’s Claims Agreement London EDI ECF Repository CLASS in Lloyd’s and Companies’ Market London EDI Phase 3 Repository + ACORD Claims Movement message ACORD Technical Acct Phase 4 Common End Vision - All parties involved - All processes fully automated - ACORD RLC messages - Enables remote working but does not impose it World Headquarters: Two Blue Hill Plaza 3rd Floor Pearl River, NY 10965 USA +1 845 620 1700 London office: LUC - Suite 1/3 3 Minster Court Mincing Lane London EC3R 7DD UK +44 207 617 6400 FUTURE APPROACH TO COMMUNICATION Presentation name 00 July 2005 48