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Electronic Market Reform Contract Endorsements Sponsors and Project Managers - Workshop

Electronic Market Reform Contract Endorsements Sponsors and Project Managers - Workshop. 28 th January 2009. Introduction & Background Bi-Lateral agreements Current Status & Targets Broker & Insurer Responses Workshop Conclusion. John Muir Steve Hulm ALL. Agenda.

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Electronic Market Reform Contract Endorsements Sponsors and Project Managers - Workshop

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  1. Electronic Market Reform Contract EndorsementsSponsors and Project Managers - Workshop 28th January 2009

  2. Introduction & Background Bi-Lateral agreements Current Status & Targets Broker & Insurer Responses Workshop Conclusion John Muir Steve Hulm ALL Agenda Page 1

  3. Reforming endorsements: a big prize • For non-complex, non-urgent, low value to client but high admin cost • Approx ½ million endorsements p.a. • Faster agreement process • Frees brokers and underwriters to do something more useful • Agreed endorsement is basis of client documentation • Improved contract certainty • Saves broker rework • Documentation to client quicker • Bridgehead into electronic trading Page 2

  4. e-MRCE summary: focus is email • “Keep it simple” • Email is sufficient – new technology is not a pre-requisite • Use structured data messaging when you have it • Certainly non-complex, but don’t be afraid to go further • “Just do it” • Email widely used for non-London Market business already • Brokers: extend use of email to your London Market business particularly for non-complex, non-urgent, endorsements • Insurers: respond using email Page 3

  5. Email Bi-Lateral Agreements • Whereby a broking team and underwriting team agree to the email submission of ALL endorsements, within a class of business • Negotiation and agreement can then be via email, or face to face, as appropriate • We are developing a “protocol” regarding how this would work • We will then be seeking volunteers to participate Page 4

  6. Electronic endorsements - broker submissions 3000 2500 2000 1500 1000 500 0 Apr May Jun Jul Aug Sep Oct Nov Dec Broker electronic submissions Monthly Interpolated target Q3 target Current Status and Targets • Data received from approx. 20 insurers and 20 brokers (including Aon, Marsh and Willis) each month • Volume has increased significantly … … but below target. • Limiting factor = acceptance by front-line brokers and underwriters? Page 5

  7. Selection of Broker Responses • e-MRCE provides us with clear benefit … • … particularly where it means that technicians can communicate directly with the market (including from outside London) • We’ve had endorsements agreed in under 5 minutes • It brings the process for London & Overseas markets into line • Follow agreements and notifications can be executed in parallel • Front-line brokers may not be keen • Individual underwriters may not be keen • Measurement a chore • Some prefer to await a structured messaging solution Page 6

  8. Selection of Insurer Responses • Our doors are open to brokers that want to operate in this way • Brings London process into line with that adopted elsewhere in the group • Maintains a record of the agreement • Endorsements via email can be integrated into our workflow systems – and hence visible on underwriters’ desktops • Provides a stepping stone (& benefits case) towards full electronic support for placing (& hence reduced re-keying) • Volumes are currently low; measurement a chore • Supports endorsement agreement by underwriting assistants • Non-standard submissions hinder take-up Page 7

  9. Workshop Questions – by show of hands • Is e-MRCE providing benefit today? • Does email act as a stepping stone to support for placing via structured messaging? • Addressing the cultural issues? • Providing experience and the basis for a benefits case? • Do you think that your organisation would participate in Bi-Lateral agreements? • For 100% of endorsements, within specific classes/teams • Question(s) from the floor? Page 8

  10. Workshop Questions – breakout groups For INSURER representatives: • How to promote front-line underwriter acceptance? For BROKER representatives: • How to ensure (broker) adherence to agreed e-MRCE standard? Page 9

  11. Conclusion • Thank you for coming … and for participating • Watch out the announcement of bi-lateral arrangements • I will be meeting with as many of you as possible over the next few months to gain your input … in the meantime • We are very open to individual suggestions and comments regarding the issues raised today Email: steve.hulm@marketreform.co.uk Page 10

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