September 2018

LMA Action on Delegated Claims

The LMA is focusing its efforts on realising benefits to delegated claims agents (DCAs) in the Lloyd’s market. Delegated authority (DA) claims is a priority for the Lloyd’s Market Association Claims Committee (LMACC) in 2018/19, through its concentrated support of the market’s previous and current initiatives. The Committee’s DA Claims Strategy will remove burden from DCAs, improve the customer experience, and make Lloyd’s and London more efficient.

In the short term, the programme encompasses improvements to handling and overseeing delegated claims to ensure business processes are consistent (in non-commercial areas), and provide effective oversight throughout the delegated claims lifecycle. In the longer term, changes will be supported by the market’s underlying technology platforms, to ensure the operation of delegated claims is efficient with minimal touch points, while providing the right data to Lloyd’s managing agents and DCAs. 

Much of the Strategy is informed by Lloyd’s Q3, 2017 Delegated Claims Thematic Review. The Review investigated the effectiveness of managing agents’ frameworks for procuring and overseeing third-party claims services. It identified current good practice, but also revealed areas for improvement. Many of the latter will be best dealt with through market-wide initiatives, the report concluded. The LMACC is working actively to address those areas with market wide support.

This programme of work will address the challenges within delegated arrangements, to help overcome the fractured approach within the market. Refreshing the delegated claims model, for the benefit of our customers and delegated agents, will allow the Lloyd’s market to:

  • Provide an improved, common and consistent experience for TPAs and Coverholders
  • Provide an improved service for customers via delegated agents 
  • Improve indemnity accuracy 
  • Make it easier for delegated agents to transact with us, while removing as many decision and touch points in the delegated supply chain as we can
  • Streamline and accelerate the handling and oversight of delegated claims
  • Remove burdensome requirements on TPAs, coverholders and brokers that add no value to the process or the customer during the claim lifecycle 
  • Implement and adopt a risk-based approach to handling delegated business classes

The program of work will look to encompass the full end-to-end delegated claims cycle, including:

  • Co-lead claims agreement that will streamline and reduce the agreement parties in co-lead placements, in part through a model wording 
  • Consistent and common approach to claims authority levels and loss funds
  • Due diligence of delegated claims entities prior to engagement and on an ongoing basis 
  • Terms of delegation ensuring that the delegated claims entity has the right amount of authority to effectively handle claims
  • Monitoring the performance of the delegated claims entity through use of appropriate management information and data 
  • Common and consistent SLAs to manage claims service and standards
  • Ensuring an effective audit strategy focused on customer outcomes and technical claims handling 

To enable efficient and effective performance management, which in turn will drive service delivery standards, a second workstream will make third-party performance data more readily available, in a standardised form. Deliverables include implementation of straight-through processing that removes the need for bordereaux submissions, a review and enhancement of existing claims data standards and monitoring tools, and integration of the agreed SLAs within DA Submission, Access and Transformation (DA SATS) to enable automated performance-monitoring reports. 

More detail, including a comprehensive timetable of deliverables, is available in the LMA’s Delegated Claims Oversight Strategy market update, published last month and available from the LMA website. 

Written by


Lee Elliston
Claims Director