LMG Forum May 2011

1. LMG ForumMay 2011 Christopher Croft, LMG Secretariat Rob Gillies, LMA

2. Agenda • Modernisation update • Endorsements initiative

3. ECF2 Current Status Current slide 23rd May

4. eAccounts eAccounts Release 1B (R1B) Miller continue their controlled submissions of live business Upgraded testing and training environment has been established for full rollout – Aon will commence their testing on 13th June. UIB, Guy Carpenter & Price Forbes requested an extension of their testing into May which is now concluding. Plans for further Broker roll out are being established with LIIBA eAccounts Release 2 (R2) Change Requests following the detailed functional review are being evaluated. Options for progressing are being reviewed for presentation to the EAMG 25th May The build phase has commenced.

5. The Message Exchange Limited (TMEL) • Ownership transferred on 18th May • New Terms and Conditions in effect • If you have not signed…

6. Capita • Catlin • Chartis • Decus • Faraday • Flagstone • Generali • Groupama • HCC • Hiscox • Jubilee • Lancashire • Liberty • MAP • Markel • Miller • Navigators • Novae • Odyssey • Omega • QBE • Randall & Quliter • RenRe • RKH • Ropner • RSA • Scor • Sirius • Sportscover • Swiss Re • Talbot • Torus • TransRe • Travelers • UIB • Whittington • Willis • XL • Zurich • Aegis • Alterra • Amlin • Arch • Argenta • Argo • Ark • Ascot • Aspen • Atrium • Barbican • Beaufort • Brit • Canopius

7. Future process • Next steps • Future process narrative • Addressing issues raised in the consultation process • Highlighting differences between current and future process • Fleshing out the proposals in more detail, via process narrative documents. •  And then: •  Infrastructure, service provision and systems implications of the future process •  Cost benefit analysis and client service impact assessment

8. Non bureau progress • Pilot work continues • Firms involved: • XL Re • XL Insurance • Chartis • Chubb • RSA • Aon • Willis • More welcome

9. Questions?

10. Agenda Endorsement Initiative Update Electronic Support for Endorsements LMG Forum 25 May 2011

11. Agenda Agenda Endorsement Initiative Update • Marine pilot update and benefits • ‘Smart firms’ • 2011 sponsored classes of business • Rollout timeline • What next? • Questions

12. Agenda Achievements Endorsement Initiative Update • Exchange connections – technical capability of the market to exchange electronic data messages • June 2010 May 2011 • 3 102

13. Agenda Achievements Endorsement Initiative Update • Message volumes – use of messaging to support business transactions • June 2010 May 2011 • 1,220 52,000 (March) • 12,000 325,000 to date • to date

14. Agenda Achievements Endorsement Initiative Update • Understanding the messaging process – support for broker-underwriter negotiation • June 2010 May 2011

15. Agenda Achievements Endorsement Initiative Update • Consensus about the future – messaging is a key part of our market’s future • June 2010 May 2011

16. Agenda Achievements Endorsement Initiative Update • Benefits – understanding and realisation of benefits • June 2010 February 2011 • Benefit now • 0 (?) 35% • Benefit in future • 0 (?) 89%

17. Agenda Achievements Endorsement Initiative Update

18. Agenda Marine pilot update Endorsement Initiative Update • Live trading began 1 October; 3 month pilot assessment period • Pilot review now complete and results have been communicated • 3 surveys to gauge the experience of marine pilot practitioners • Post pilot review • Independent benefits review by E&Y • Degree of success established and lessons learnt: process proved to be stable • Pilot issues are being addressed, currently 13 key process issues for which a delivery plan has been confirmed • Confirmed roadmap for roll out to further classes through 2011 and 2012

19. Agenda Process use Endorsement Initiative Update ‘Silent’ endorsements P R O C E S S Negotiation Scratch Transmission of data and documents

20. Agenda Process use Endorsement Initiative Update Simple negotiation P R O C E S S Negotiation Scratch Transmission of data and documents

21. Agenda Process use Endorsement Initiative Update Complex negotiation P R O C E S S Negotiation Scratch Transmission of data and documents Transmission of data and documents

22. Exchange Volumes Message volumes • Volumes have been encouraging

23. Main benefits identified by the endorsement pilot • Reduction in man hours • Improved error rates • Reduced turnaround time for simple endorsements • Improved customer service through gains in turnaround times • Real time tracking available = increased transparency • Improved credit control, capital allocation and management information

24. Agenda ‘Smart firms’ Endorsement Initiative Update Process - Greatest benefits are experienced where responsibilities and resources have been clearly allocated to e-Endorsements. Senior sponsorship -The CEO is visible within the firm promoting the initiative Address the impact of cultural change -This is not a technology project. Organisations need to consider the impact on people and processes and monitor and adapt to these. Integration – Greater benefits and acceptance of the process are achieved where firms have a level of integration

25. Agenda Case studies Endorsement Initiative Update Broker Insurer

26. 2011 Sponsored classes of business • Roll out to further classes of business sponsored by three major brokers and insurers: • Property (Aon) - Catlin • Professional Indemnity (Marsh) - Beazley • Specie (Willis)- Ace • Other brokers will come on board for these classes on a rolling basis • Marine is business as usual – volumes are building • All other classes of business ‘open for business’ on a bilateral agreement basis • Roll out to all classes in 2012

27. Agenda LMG Roll out timeline (awaiting PSSG approval) Endorsement Initiative Update

28. Measurement and monitoring Agenda Endorsement Initiative Update • Other projects show that measurement and peer-comparison drive adoption • Need to be careful we measure the right things • Data from the Exchange is valuable but limited • Data from market firms is necessary but that has its challenges • Measurement of benefits realisation • PSSG guidance to be sought

29. What next Agenda Endorsement Initiative Update • Carriers: Work with sponsoring brokers to identify underwriting and broking teams affected by scope definitions • Carriers: Provide underwriter or generic mailbox addresses for each class1 • Brokers: Decide on participation in 1 July classes and discuss engagement with project team (trevor.maddison@lloyds.com) • New Exchange connections: participate in Exchange testing2 • All: Identify and progress bilateral messaging partnerships • All: Undertake business familiarisation with practitioners and draw on central resources - example business scenarios; limited test messages (dummy carrier or broker); workshops; PM surgeries • (1 Details using standard contacts template to the Exchange Team by 20 June james.bobbitt@lloyds.com) • (2 Contact the Exchange Team james.bobbitt@lloyds.com)

30. Agenda Endorsement Initiative Update Phase Two: 1 July 2011

31. Agenda Endorsement Initiative Update Questions?

32. CONTACTS Lloyd’s Contacts • James Bobbitt (Technical) Telephone: 020 7327 5248 Email: james.bobbitt@lloyds.com • Paul Willoughby (Project Management) Telephone: 020 7327 6634 Email: paul.willoughby@lloyds.com • Trevor Maddison (Relationships) Telephone: 020 7327 5231 Email: trevor.maddison@lloyds.com • Abby Mullen (Project Support) Telephone: 020 7327 5631 Email: abigail.mullen@lloyds.com LIIBA Contact • Chris Buer Telephone: 020 7280 0154 Email: chris.buer@liiba.co.uk LMA and Endorsements Pilot Contacts • Rob Gillies Telephone: 020 7327 8377 Email: robert.gillies@lmalloyds.com • Peter Holdstock Telephone: 020 7327 8383 Email: peter.holdstock@lmalloyds.com LMG Secretariat contact • Steve Hulm Telephone: 020 7327 5249 Email: steve.hulm@londonmarketgroup.co.uk IUA Contact • John Hobbs Telephone: 020 7617 4445 Email: john.hobbs@iua.co.uk