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London Market Reforms - where are we, where are we heading Software Providers Forum

AGENDA. Overview of London Market Reform ObjectivesBenefits and Status of Insurers' Market Repository (IMR)ECF

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London Market Reforms - where are we, where are we heading Software Providers Forum

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    1. London Market Reforms - where are we, where are we heading? Software Providers Forum/IT Club

    2. AGENDA Overview of London Market Reform Objectives Benefits and Status of Insurers Market Repository (IMR) ECF Benefits and Status Questions

    3. Objectives Rationalise and streamline processes to: Remove reliance on paper Capture data once and once only, re-use data/reduce re keying Reduce reconciliation/rejection errors Introduce flexibility let business requirements determine the process, not have the process driven by constraints Speed up premium/claim agreement and payment processes Implement ACORD XML RLC standards Remove Londonisms Enable back office rationalisation Enable Global processes

    4. Market Reform Strategy The medium/long term vision Implement ACORD RLC XML Messages for all processes where appropriate Adopt standard global practices and processes Insurers choice of service provider (s) and processing approach There can be one or many service providers operating in the London market No more Londonisms Brokers account at fundamental split level only (Lloyds only) Automatic broker funding/payment of deferred premiums Delinked approach as standard

    5. Market Reform Strategy All Design and Functional Specification, Implementation Guide documents posted to Market Reform website Current status: www.marketreform.co.uk Next Steps Brokers and Carriers need to liaise with trading partners to adopt and implement P2P process initiatives as appropriate. Market Reform Strategy Group (MRSG) made up from members of LMBC/IUA/LMA currently identifying early Implementers to create a Matrix to enable joint ventures to progress. Participants and early implementers need to review documents to identify key factors to enable strategic end vision and the implementation steps required to achieve the vision.

    6. Insurers Market Repository (IMR) Electronic Premium Accounting (EPA) electronic submission of slips, PANs, policy wordings and supporting information by the broker to Xchanging Electronic Claim Files in IMR Two methods available for submission of EPA and Claim documents Direct Load/DRI All documents stored in IMR whichever submission method used IMR will include a structured (i.e. bureau) and an unstructured (i.e. non-bureau) area UMRs - unique and maintained even if broker of record changes mid term

    7. Insurers Market Repository Benefits to Brokers: Reduced paper and handling costs Faster processing times no van time Faster query resolution Reduction in rejection rates Enhanced audit trial & reconciliation DRI functionality consistent with ECF ECF reduces number of paper claim files in marketplace Utility function (non bureau), allows document exchange between trading partners for P2P processing.

    8. Insurers Market Repository Benefits to carriers: No van time - speeds up premium processing Faster query resolution speeds up premium processing Signed lines available to all parties quicker ECF enables concurrent claims agreement for all carriers Access to all broker documentation in the IMR Utility function (non bureau), allows document exchange between trading partners for P2P processing

    9. Insurers Market Repository Implementation status - A&S Currently 64 Brokers live Direct Load/DRI Continued Broker Implementations planned for 2nd half year 2007, all LMBC members scheduled for go live by end of 2007 20,000 PANs submitted to 31st December 2006 185,000 PANs (26% of daily volume) submitted to 31st August 2007 Planned transactions by year end 80+% (volume) Planned brokers live by year end 100%

    10. Repository Implementation status: A&S Phase 2 Completed - MAT June 07 Live 26th August 07 Reinstatement Premiums/simultaneous settlements (single UMRs) Enable Urgent transaction/re-submission processing (PPWs etc) Store all Metadata New XIS Gateway

    11. Repository Implementation status: A&S Phase 3 Planned MAT Sept 07 Live mid November 2007 User defined ACLs (Access Control Lists) now deferred to 1st Qtr 2008 Short-termsolution (work around) Simultaneous settlements (multiple UMRs) Edit work package Ability to store LPANs and other docs as simple non-ACORD data Proportional Treaty Statements (ie multiple UMRs) Additional DRI functionality for search and download

    12. Insurers Market Repository Electronic Claims File (ECF) Update

    13. Insurers Market Repository ECF Cont Improve service to all clients (re)assureds, cover-holders, brokers etc Enhance London market reputation speedier claim service - reduce Claim lifecycle Concurrent, 24/7 access to claim files allows all parties to focus on complex Significant cost savings paper, time, space

    14. Insurers Market Repository ECF Cont Lloyds ECF live set 2006 allows all in scope claims to be agreed electronically All Managing Agents signed and using Repository (IMR) Companies commenced Pilot June 2006 7(8) IUA Carriers; Global Aerospace, Liberty, Markel, Munich Re, Swiss Re, XL Re, Zurich (AIG) in house trial ahead of IUA Pilot

    15. Insurers Market Repository ECF Cont Company Pilot extended for 6 months in December 2006 to: Allow more volume (only) 500 new loss advices (Companies) by December 06 Allow additional participants to trial AXA, Axis, Endurance, QBE, SCOR, Transatlantic Re

    16. Insurers Market Repository ECF Cont Where are we now? 3 Companies live 10 Companies in Implementation process 12 Companies having demonstrations/in start up mode All Managing Agents Live 30 Brokers using ECF Weekly 47% of in scope claims processed via ECF within Lloyds (as @ 7th September). 4 week rolling average 43% 10,000+ new notifications processed 2007 average 500+ per week

    17. Insurers Market Repository ECF Cont Evaluation by Companies completed (by original piloteers) System performance Xchanging service & support System functionality Business efficiency impact System Process and Procedures manual (completed) Service Contract almost agreed Charges/charging mechanism agreed and communicated to the market

    18. Insurers Market Repository ECF Cont Company Evaluation results Processing requirements met Acceptable workarounds for functional shortfalls Easy to use Demonstrable efficiency gains for both lead and follow positions Issues for resolution Functionality shortfalls (change requests MAT October 2007 live November 2007) Contractual items to be agreed (inc. repository rules inadvertant disclosure)

    19. Insurers Market Repository ECF Cont System Functionality Lloyds assurance on document management Change requests being delivered Oct 2007 Contract Current Pilot contract for an interim period Mutual market recognition on inadvertent disclosure Charges (Companies) Licence Fees (350 per licence) Start up fee 7500 (15000 for 2008) Transaction (2008) charges to cover : IUA contribution to IMR development Prospective operational costs Enhancement fund (h/ware and functionality)

    20. Next Steps System Functionality Cross market user group to identify & prioritise further enhancements for Release 7 expected delivery 2nd Qtr 2008 Contract Urgent resolution of contractual issues Promote take up amongst IUA members and Brokers - essential for overall market take up Ambitious 2007 target (Lloyds - 100% all new advices by year end)

    21. Any questions?

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