18 January, 2005 – Lloyd�s Head of Business Process Reform Iain Saville today announced two initiatives which give brokers and underwriters timely new information on the checks carried out by XIS.
The new initiatives will reduce the risk of agreements and policies being rejected, and help to achieve contract certainty in the Lloyd�s market.
For the first time, the market has been given data on binding authority agreements rejected by XIS checking in 2004, and the main reasons for those rejections, in a new market report published today.
In addition, brokers and underwriters can download from the Lloyd�s website the standard checks for each subclass of binding authorities which XIS carry out on instruction from Lloyd�s. Available from the start of this year, this will enable them to engineer compliance with the checks into their placing processes.
Both of the current deliveries apply to binding authority agreements only in this first phase. Lloyd�s plans to expand the information to cover all types of business by July 2005.
Mr Saville said:
�This is a significant step towards achieving contract certainty. We want the Lloyd�s market to be secure and efficient, and providing this important information to our brokers and underwriters helps them achieve that goal in an economical way. We will review the checks for relevance and value, and welcome market feedback during that process.
�The website will make it easier for the market to understand what Lloyd�s requires in agreements, so there are fewer erroneous submissions. �Right first time� cuts costs for everyone.�
�The market reports, modelled on the existing LMP slip reports, will help brokers and underwriters see the key areas they need to focus on so they can manage standards higher. We will extend this approach to other classes of business over the next six months, working with the market to achieve efficient processes which improve client service and advance contract certainty.�
The market report also provides an anonymised league table showing the percentage of submissions rejected by XIS for the 20 Lloyd�s brokers that had the most rejections in 2004. The worst broker had a rejection rate of 72%, and even the best of the group had a rejection rate of 35%. Some submissions were rejected as many as eight times.
Mr Saville said:
�The market�s adoption of LMP slips will go some way to reducing rejection rates, but clearly this will not be enough. The market needs both to improve quality, and to work with XIS to streamline error detection and correction, in order to reduce contract risk and improve client service.�
Brokers and underwriters can see the list of checks XIS carry out when checking binding authority submissions on the Lloyd�s website � www.lloyds.com/qachecking. The tool is intended to allow market users to interactively create a check list applicable to a given type of business within binding authority agreements.
The market report is available at www.lmp-reforms.com
Please note: Lloyd’s accepts no responsibility for the content of external sites.
The 20 brokers highlighted in the market report are those that had the most rejections from XIS in 2004.