Market Processes newsletter January and February 2012
Welcome to the first newsletter of 2012
As ever, we are always keen to hear from you with suggestions for topics to interest you. This edition carries a number of sporting themes with opportunities for both spectators and participants. Read on!
With over 130 years of business and processing experience between them, the LMA Market Processes team is the focus for the association’s support to numerous market modernisation programmes. Supporting me are Peter Holdstock, Peter Griggs and Keith Welch.
The team covers a wide range of responsibilities including facilitating process-related LMA committees and groups; co-ordinating Lloyd’s market support to LMG workstreams; project management of specific LMG workstreams; providing a market voice into the Corporation of Lloyd’s on process-related matters; maintaining and developing the relationship with Xchanging Ins-sure Services (XIS); promoting market process improvements for both business as usual and longer term models; representation at market conferences and panels; and keeping the market abreast of all of this activity.
If you wish to know more about either the general work of the team or articles in this newsletter, please contact a member of the team via the team details to the right.
Rob Gillies, Head of Market Processes
Xchanging and Solvency II
During late 2010 Xchanging and the LMA set up a working group to identify and plan for managing agency Solvency II requirements of Xchanging. The group included representation from the Claims Services Review Board (CSRB) and Xchanging Review Board (XRB), as well as Lloyd’s Solvency II team.
In addition to the activity arising from the group, Xchanging engaged KPMG to review and comment on its preparedness to support Solvency II. As anticipated, the report supported Xchanging’s readiness and suggested a number of potential changes including the implementation of a data directory to ensure data definition, ownership, lineage and quality; and a number of enhancements to Xchanging’s existing risk management framework. Xchanging have published a market communication on their activity.
Xchanging systems and services – current systems status
As a major provider of systems and services to the Lloyd’s market, Xchanging worked with the LMA Systems Group on a number of matters during 2011.
The Group is keen to raise managing agents’ awareness of the Xchanging service screen. The screen consists of two at-a-glance pages – status of the numerous Xchanging systems used by the market and, in the event of service issues, an outline commentary on status and resolution activity; and the status of premium and policy processing services. No user ID is required to access this webpage.
While the service screen gives an (effectively) real-time status of services, monthly performance reports are provided via the LMA website for premium processing, claims, and IMR performance. An LMA logon is required to access this historic data.
E-Accounts update
As previously reported Miller, Price Forbes, UIB, Guy Carpenter, AON, AON/Benfield, Ropner, Towers Watson and Lockton are live with Release 1 (Xchanging’s ability to receive and process electronic accounts messages) and are steadily building their volumes. In addition, NMB and Houlder are in their testing phase ahead of implementation. LIIBA continue to actively encourage further brokers to participate.
The analysis and design phase of Release 2 continues and is scheduled to complete in 1Q 2012, with early indications that build and Market Acceptance Testing can be completed within 2012. This will introduce the carrier accounting entries service for which the initial service specification and definition of fundamental or non-fundamental accounting entries was produced by an LMA-led working group.
E-Accounts has the potential to meet many of the “right first time” aspirations of eradicating market reconciliation issues through reuse of data, straight through processing, and both broker and Xchanging systems validations providing earlier detection and control of incorrect data fields. LMA and its various member groups are focussed on realising this benefit. We encourage you to discuss your broker-partner plans for adoption.
For further background on this work, see our Bluffer's Guide.
Olympics 2012 – the year has finally arrived
July 2005, when the International Olympic Committee announced that London would host the games, seems like a lifetime ago now. The games are upon us with less than 200 days to the opening ceremony. Across the market activity is underway at all levels to ensure the Olympics and Paralympics taking place during August and September do not impact the market’s ability to write and process insurance business.
Specifically, XRB have engaged with Xchanging to ensure that market requirements are understood and appropriate plans have been considered and implemented to mitigate potential disruptions during the games. Further communications will be provided to the market in due course.
As a warm-up to the Olympic cycling events, you may be interested in the separate newsletter article on the Xchanging South Downs to the Sea charity cycle ride.
Annual controls reports – Xchanging claims and premium processing and Lloyd’s settlement service
As part of their annual control audit activities, both Xchanging and Lloyd’s publish control reports covering their respective elements of the market claims and premium processing services provided by Xchanging, and the resulting monies settlement service administered by Lloyd’s.
Lloyd’s have distributed their report via the LMA’s Compliance Officers and Finance Directors distribution lists. The Xchanging reports are available via your Xchanging customer relationship manager (020 7780 5310).
Bluffer's Guide – the latest edition
Your feedback confirms that the Bluffers Guide continues to be useful to numerous market practitioners as a tool for keeping abreast of modernisation activity; recent feedback also indicated it is part of the induction reading for new starters in the market. Published quarterly, the latest version has now been published, providing updates on key work achievements last year as well as providing background information to ongoing work.
Cessation of Terms of Trade (TOT) codes at 31 March 2012
As you will be aware from the previous newsletter, PAG supports XRB by working continuously with Xchanging and Lloyd’s to review today’s market premium processing activities to ensure processes meet current and future market and Lloyd’s requirements in the most efficient ways possible.
The capture and recording by Xchanging of Terms of Trade (TOT) codes is a process that PAG reviewed last year and investigations concluded that the codes are effectively redundant. As part of the investigation, Lloyd’s have confirmed that they do not use TOT codes for tax and regulatory reporting. Consequently PAG plans to recommend to XRB that Xchanging be instructed to cease capturing TOT Codes at the end of this quarter year.
While PAG believe the codes are no longer used in the market, PAG recognises that it is possible some managing agents still rely on the codes. If you believe your agency does still make use of TOT codes, you are asked to let the PAG secretary, Keith Welch, (keith.welch@lmalloyds.com 020 7327 8409) know by close of business 29 February.
It’s good to talk
Communication has moved on in many shapes and forms since BT used their “It’s good to talk” tagline in the 1990s. Regardless of the medium, the phrase is just as valid today. With internal deadlines and pressures, it remains essential for us to stay in touch with our peers even when it may be difficult to find the time to attend market meetings.
Consequently, a number of managing agents and the LMA have been exploring how we might collectively continue to share and develop ideas using technology. One such vehicle, which is gaining traction in the Lloyd’s market, is the Yammer tool. Although early days, a number of managing agents are using “LMA Collaboration” network to share ideas quickly and efficiently.
Yammer allows private groups of people, both within an organisation and across multiple organisations, to set up topics and to contribute to the ongoing discussions. Topics already initiated on the LMA Collaboration area include iPads, compliance, E-Endorsements, DR and business continuity, binders, and claims management.
To access the LMA Collaboration network on Yammer you will need to be “invited” by one of the network administrators. If you want to know more, or wish to be invited into the network, please contact Peter Griggs (peter.griggs@lmaloyds.com or 020 7327 8380).
Keeping the wheels turning
With the Olympics only months away, business continuity is now on everyone’s agenda and here, in the London market, we’ve collectively added a further service to aid the market in minimising business interruption. With the E-Endorsements process now able to support all classes of business, as a market we are well placed to manage endorsement authorisation electronically in the event that we find ourselves unable to access the Lloyd’s building, or even if we’re working at home. With the Olympics likely to impact travel around London, E-Endorsements will especially assist organisations considering the case for working from home or mitigating interruptions during the Games.
Aside from minimising potential or actual business interruptions, E-Endorsements is a major asset enabling businesses to rethink their operating strategy. In addition to providing opportunities for efficiencies on a day to day basis, E-Endorsements can facilitate new ways of working, both at the Box or in the back office. Equally, for entities deploying the appropriate IT infrastructure, it is possible to completely remove the traditional geographic limitations associated with managing the endorsement process physically in the London market.
Who’s using what?
As part of the LMA’s work to support E-Endorsements and additional work undertaken by the LMA’s Systems group, managing agents were invited to contribute to an informal directory (the “landscape analysis”) which lists various categories of software and the supplier being used by managing agents. The directory is now available to managing agents and could be a useful reference tool for “comparing notes” in the event that an agent is considering changing software. Access, via the LMA website, is restricted to managing agency staff.
Introducing the Cross Market Messaging Group (CMMG)
The Cross Market Messaging Group (CMMG) operates jointly on behalf of the LMA and International Underwriting Association (IUA). Within the Lloyd’s market, the CMMG supports the LMA Systems Group. CMMG was formed in 2005 to assist with the implementation of EDI messaging – transferring structured data between market systems in order to assist one time data entry and quality.
The CMMG is chaired by Steve Wright of Liberty, with representation from carrier software houses, carrier IT technicians/project managers and Xchanging. The group meets two-monthly and focuses on the market modernisation agenda, topical IT issues and opportunities, Xchanging operational activity, and responds to requests for support on IT related issues as they relate to the various forms of messaging used in the market.
Topics the group considered in 2011 include the Future Process Vision (with a consolidated response), ECF2, E-Accounts, Xchanging operational issues/downtime, Solvency II awareness, emerging technology, ACORD gateways and message handling, improved collaboration, IMR usage, and E-endorsements.
The CMMG brings the opportunity for carriers and their software houses to work co-operatively together and the group are keen to provide additional IT support and knowledge to the other business panels of the LMA and IUA. This all helps the London insurance market make best use of the constantly emerging and changing opportunities that IT brings, at an ever increasing pace.
While the CMMG focus for 2012 remains largely unchanged, the group is keen to assist the market with community-wide activity. For more details please contact Peter Griggs (peter.griggs@lmalloyds.com 020 7327 8380).
South Downs to the Sea Cycle Ride
If the all too common corporate golf day seems bit tame, how about participating in the Xchanging London market cycle challenge? Max Pell, a keen cyclist himself, has confirmed that Xchanging will sponsor a 150k Sportive on 25 May 2012. The route will circle West Sussex and break for lunch at the excellent East Beach Cafe. A shorter 80k route will be available in the afternoon for those keen to support the event but wanting a gentler day. The course will be fully marked out and timed using electronic chip timing. There will be prizes for best teams and individuals.
As this is a charity event there will be a £100 entry fee plus the opportunity to raise funds for your own charities. Xchanging are looking for market teams of four plus individual entries with a mix of abilities. A number of people have already registered their interest in the event. If you wish to register for further information, please contact chloe.rees@xchanging.com or see the Xchanging market communication.
Return to the Market Processes newsletter archive