Transcript Opening up the market of choice

LMG Secretariat
LMG Forum
July 2010
Christopher Croft, LMGS
Barnabas Hurst-Bannister, LMG
With
LMG Forum 2010
Agenda
• Presentation
• Modernisation this month
• A year in the Chair
LMG Forum 2010
Caption competition
LMG Forum 2010
Chairman Personality
LMG Forum 2010
FWWS - eAccounts
• Release 1B targeted for Q4
2010
• Release 2 targeted for Q3
2011
FWWS – ECF2
LMG Forum 2010
• Some issues with MAT
• These have the potential
to affect the go live date
• XIS has been asked to put
forward any proposed
changes to the ECF2
Management Group
• Full details will be
communicated to the
market as soon as
possible when they are
clear
Right first time
• Key Considerations paper
LMG Forum 2010
to be published this week
• LIIBA & LMGS to visit the
top 10 brokers by volume
• The Stage One Premium
Checks have been
reviewed by Lloyd's and
Xchanging.
• The Tracker Codes are
now live and will start
filtering down in the RFT
reports brokers receive.
• Project board reviewing
targets and will make
recommendation to LMG
LMG Forum 2010
RFT – some progress already
LMG Forum 2010
Endorsements
• Market testing complete
• Firms moving onto business
scenario testing
• Interchange agreement work
ongoing
• Discussion on further roll out
at July LMG
The Exchange
LMG Forum 2010
• The Message Exchange Ltd
to be incorporated - equal
representation from all four
constituencies
– IUA
– LIIBA
– Lloyd’s
– LMA
• Owned by the market for the
benefit of the market
• Transfer of contract with
IBM
LMG Forum 2010
Non bureau business
• Modernisation aims for a
single approach
• Non bureau could be around
10% of our market
• We should seek synergies
where possible
• Working party to be formed!
LMG Forum 2010
Upcoming events
• Insurance Day
Technology Summit –
October 6th
• Xchanging conference –
November 25th
LMG Forum 2010
Questions?
LMG Forum 2010
Ask the Audience?
LMG Forum 2010
Ask the Audience member to explain
himself
LMG Forum 2010
LMG Forum 2010
LMG Forum 2010
LMG Secretariat
A year in the Chair
Barnabas Hurst-Bannister
Chairman, London Market Group
With
LMG Forum 2010
One year ago…
LMG Forum 2010
A new Chairman set sail…
At the forum
LMG Forum 2010
• Development programme
– IMR Security model to expand scope of IMR On target for Nov 2009
– XIS systems development to accept and process structured
accounting messages On target for Nov 2009
– Non-fundamental splits service On target for May 2010
– “ECF2” package of usability improvements Release from Q1 2010
– Binders solution for ECF Prototype approved
LMG Forum 2010
At the forum
Proposal being developed for EPSG
o Governance. Clarify project aims and objectives.
Re-focus EPSG and EPIG. Increased drive through market
associations.
o Use Lloyd’s Exchange Forum to address business
implementation needs of practitioners.
o Initiate a Class of Business pilot.
o Refine and embed the EP process from a practitioner’s
perspective.
o Work with the market to develop case studies.
o Initiate a program to help the market manage the
business change by establishing and running practitioner
workshops.
At the forum
LMG Forum 2010
Strategy
• Aim – to provide detailed
description of “market of
choice” that will aid
investment decisions
• Discussions with market
leaders
• Work with Associations and
Lloyd’s
• Consultation paper - draft to
MRG in July
• Target: publish in September
LMG Forum 2010
So, how have we done…?
• We have not, yet, delivered eAccounts
• ECF2 is not scheduled to go live until September
• FWWS will stretch at least into 2011 and probably
beyond
• Why?
FWWS 2009 - 10
LMG Forum 2010
• We have made some mistakes
– Underestimated the complexity of eAccounts
– FWWS governance was inappropriate
– Market was not an effective customer to XIS
• But we have learnt
– Resolved governance problems
LMG Forum 2010
FWWS 2009 - 10
LMG Forum 2010
• We have made some mistakes
– Underestimated the complexity of eAccounts
– FWWS governance was inappropriate
– Market was not an effective customer to XIS
• But we have learnt
– Resolved governance problems
– Moorhouse Consulting
– Clarity of responsibility on XIS side
– Market procurement experts
– Robust specifications, fully tested quotations, solid contractual
footing
FWWS 2010
LMG Forum 2010
• Finish What We’ve Started
– Fully costed
– Fully justified – eg eAccounts CBA
– Appropriately contracted for – fixed price
– Effective governance
• Sounds simple but…
– Standard approach in a single firm
– But we are 250 separate firms
– And we don’t like paying for stuff…
Progress elsewhere…
LMG Forum 2010
• Class of business pilot a glint in the eye in July 2009
• Now
– 100% of Managing Agents
– 26 Companies
– 80% by premium volume of Brokers
• Commitment to deliver
• Learnt our lessons
– Governance & Planning
– Realism
• Marine eEndorsements from 1st September for the Vanguard
and 1st October for the…
Again, we have started so we’ll finish…
LMG Forum 2010
• Discussions beginning on next classes of business once we
have learnt the pilot lessons
• Wider roll out to all endorsements by the end of 2011
– Phased by classes
• Wider placing road map also up for debate
– Likely to include a similar class of business approach
– Binder declarations
– More coherent links to premium settlement and claims
And also…
LMG Forum 2010
• Preliminary strategy discussions have become Future
Processing Model
– Looking at what we do not just how we do it
– Do all of the elements of our transaction join up?
– What central services do we continue to require?
• Strong governance & project management
• Early thoughts at LMG in September and here in October
Where are we…?
LMG Forum 2010
• In decent shape
• Strong consensus behind the current agenda
• FFWS lessons absorbed and strengthened our approach
• Bite sized chunks remains the way to go
• Endorsements pilot will face many hurdles but we have
everything in our armoury needed for it to be a success
• Future Processing model will provide as much vision as this
market can take and will provide a roadmap that will help
firms plan their investment
LMG Forum 2010
Award winning
Some truths remain self evident
LMG Forum 2010
• Consensus is key
• Manageable stages
• Pilot, prove, adjust, roll out
• Learn in the crucible of live business
• Technology supports business - it does not
trade…
Straight Through Processing (STP) in
the London Market
LMG Forum 2010
What STP is not…
• The removal of manual intervention from the London process
– Business is too complex to automate fully
– Auto rating and other techniques have a place but cannot replace the
underwriter for many of our risks
What STP is…
• The removal of manual effort where it does not add anything
– Capture data once, use it many times throughout the transaction
– Capture data as close to source as possible
– Join up the transaction such that data that should be captured at placing
is not rediscovered when it comes to accounting or claims
• Increased auditability and, potentially, quality of data
– Know where it came from and what you have done with it since
– Bedrock of Solvency II compliance
LMG Forum 2010
What next…?
• Governance is now strong but overly complex?
– Rationalise?
– Close committees down???
Current governance
LMG Forum 2010
LMG
Future Processing
model steering
group
Placing Working
party
MIG
Binders and
Facilities Working
party
eAccounts
Management
Group
eAccounts
Steering Group
A&S working party
Claims Working
party
Right First Time
project board
AAC
Claims process
sub group
ECF2
Management
Group
Placing Support
Steering Group
Endorsements
Management
Group
Placing Support
Implementation
Group
ECF User Group
LMG Forum 2010
Future processing…
LMG Forum 2010
What next…?
• Continue to ensure modernisation is inclusive
– Not just G6 & big three
– Something there for everyone
– Proceed at a pace that strikes the right balance
• Constant realism…
LMG Forum 2010
Sensitive to possible overload
• FWWS vs Future Process
Model
• Solvency II vs
Modernisation
• Always the same people
involved
LMG Forum 2010
Measurement must be king
• We have done the “bleeding
obvious”
• Must get better at CBA
• Relies on firms to store and
share relevant data
• LMGS & LIIBA working on it
LMG Forum 2010
We’ve come a long way, but there is some way yet
to go…
LMG Secretariat
A year in the Chair
With