Line 25

roger foord associates London and Global Insurance Systems Solutions, Marketing and PR 24 Lime Street, London EC3M 7HS Mobile: 07710-479070 e-mail: info@rogerfoord.com web: www.rogerfoord.com 27th March 2008 LINE 25– Bank holiday - Was it Easter or Christmas? Thank you for reading my newsletter.This is issue 71. Previous issues of my newsletter and articles printed can be found on my website www.rogerfoord.com ‘Latest News and Opinion’. After a wintry Easter blast in the UK there is good reason to look forward to warmer climates in London and better insurance conditions. Not too much happening at the moment to get too excited about but hopefully I have brought out some of the issues floating around at the moment. ********************************************************************* In this issue: * New members * Market technology – hubs and endorsements * No stopping Acord! * ECF brings on new ‘cv’ requirements * UK Budget does London market no favours * Lloyd’s Act – changes which need to be understood * …. and finally Eliot: it couldn’t have happened to a nicer man! *************************************************************************** Welcome to new members Keith Letchford of Sports Insurance Rama Varma of SSP Gareth Greenfield of IBM Kelli Douglas Aditya Malhotra of Flagstone Re Daniel Kapela Howard Hickey Simon Jeffrey: Dominic Miles: James Brennan: Eoin McDonagh of Highams Felicity Gill of Lan Ware Alena Kireeva of Faraday Sanjeev Vaz of Infobahn Christian Frisch of Prima Solutions Ramesch Fonseca Dean Bin-Matt of QBE Emily Howe of Bytes Technology Mark Turner Paul Petty of Bench Strength Vikram Arora of Reliance Colin Pinfield of Sterling Communications Kim Seeley of DIMA in Dublin Neil McCreadie of IPS group Laura McDonough of Willis’ Melanie Hopwood of ACE Duncan Baker of Marsh Stephen Cullum of SIPL Steve Grubbs of SSWPE ************************************************************************** Market technology – the latest big ideas A Big Hub: Interestingly the push for a strategic electronic trading platform at Lloyd’s appears to have gently disappeared. With Lloyd’s only looking to help by providing a single ‘hub’ for other’s solutions the expected ‘big bang’ is now a distant tremble. I could be wrong, and often I am, but what is proposed, apart from being a bit confusing in its message is purely a facility similar to a telephone company or water board. They supply the service and the user decides how and when to use it. I imagine that the fear factor attaching to previous efforts and their resultant ridicule has given the new...ish Lloyd’s regime time to ponder on whether to take a ‘giant step’ or not. If not why not? **************************** Electronic Endorsements: At the same time Willis’ are proposing an electronic endorsement system for London. I think that this has been previously proposed and now appears to be an emailed PDF of a formatted endorsement form. Good effort chaps but this is far from what should be happening, whereby the central bureau, XIS, need to get a handle on this issue before it is too late. This is what I said 16th August 2007 (Line 19) and nothing has changed, apart from the fact that nobody took any notice! “An area which has become apparent with Market reform is the natural thoughts of having electronic endorsements. The general principal of such a system is the same as electronic claims whereby the bureau has the information on the original slip and also the underwriter lines attaching to the slip. Currently brokers are going at this individually but what is needed is a central system managed by the central bureau XIS. If the brokers go their own ways without this central function, underwriters will find their workload increased and agreement processes confused.” Also does the market really think that email is the best way forward for its future? *************************************************************************************** ACORD get into bed with XIS The central bureau, now XIS, has had standard EDI messaging for over 20 years for its central accounting and reconciliation service to underwriters who write London ‘slip’ business. XIS who now run the central system are about to provide XML type messages also. There is a plan to provide this initially to the company underwriters, then Lloyd’s and then others. The take up will probably be over a long period of time and any compulsory use is not being discussed. If XML is to replace the current EDI messages then it will be the package suppliers who will have to make it available to their users. If it really is important to have XML then these suppliers will see it as a selling point and will fund the changes themselves. As 80% of the market in London uses a package the stimulus for change must come from them. *************************************************************************************** Insurance global conferences – carbon footprint issues, but who cares? The great and good of the insurance world were at it again last week in Dubai, griping about climate change and yet happy to travel the world stating the obvious. This year's travels for such speakers will include China, South America, South of France, and the US to name a few conference locations. At these events others travel from around the world self righteously telling the world where it is getting climate change wrong.One has to presume that most are also chauffeured to their offices in top of the range saloons, which wait parked all day until home time and back to the London suburbs. Funnily enough Aon brokers tell me that, unlike his predecessor, the new MD is a public transport supporter.Good for him. Let’s face it no terrorist is going to kidnap an insurance person. Nobody would bother to pay the ransom! In London though, as Lord Levene said at the recent Dubai insurance forum, the market is playing its part and getting rid of the Chatham van to be replaced by electronic ‘Pans’ and slips. According to Lord Levene the Chatham van transports ‘four tonnes of paper to Chatham each and every day’ (Advisen newslink 18.03.08).Sounds a bit high to me. If I knew how to, I could probably work out the extra carbon that will be generated by copying annually 1000 tonnes of documents electronically and transmitting them between brokers and underwriters. We await the squashed Chatham van to appear in the Lloyd’s lobby, as promised by the Lloyd’s CEO, with interest. ************************************************************************** ECF and the new ‘cv’ requirements It has been brought to my attention that now that ECF is in place and claims broking is a thing of the past, the ‘cv’ requirements for a London market claims person are that they must have the ability to be able to use a scanner and take paper clips and staples out of client documents. Better client service is then guaranteed. ************************************************************************** UK budget – no help to London but why should it? There were those in the insurance market who were lobbying for the government to help the London market with its tax burden (28%) ,as compared to Bermuda ( nothing %). It is difficult to see how the man in the street, who sees insurance owners in the press having millions to share with unhappy spouses or insurance companies making millions for share holders, to want to see even more money going their way. Any government, with limited tax options, is going to give to the poor not the ‘fat cats’. It will always be a message that falls on deaf political ears in London. *************************************************************************************** The Lloyd’s Act to be reformed The current Lloyd’s Act dates back to 1982. (I think this was probably the year of the second effort for electronic trading!). The current ideas are: * Lloyd’s brokers to lose exclusivity in London. There seems to be a desire to encourage all and sundry brokers to be able to write business in London. US brokers have said that such a change would be unlikely to make much difference in terms of US broker access to London. Bruce Guthart of HUB International in New York said:'..it is hard to imagine we would be able to establish the critical mass for our clients without using someone who has regular daily relationships with underwriters.' Anthony Strianse of Decus said of London:’…it is about the relationships and the people’ in London. Historically, and for the right reasons, brokers in London, apart from the relationship issue, have been tied financially into the London market. One of the big issues is that money due from clients to underwriters is paid on time by brokers. There also has to be the certainty of payment. Brokers and underwriters in London all belong to the UK central clearing bank system for all settlement currencies. Global brokers might not be able to provide this certainty, stability and timeliness for cash flow. Presumably this will be taken into account by underwriters in London when they choose to write global business from brokers outside of the UK. * Conflicts of Interest In future the requirement for brokers and managing agents to work separately will be removed but with reasonable reporting constraints. The FSA will take on this responsibility from Lloyd’s. * Lloyd’s chairman and council The Lloyd’s chairman will be able to serve nine consecutive years and the Council will be able to elect all 18 members. This supposedly will give better long term stability and also allow the current chairman to continue in his job if re-elected. * Lloyd’s Committee Evidently this is already a useless group as it has been replaced by the franchise board and its demise will not be missed. * Disciplinary committees Minor changes evidently to provide independent legally qualified input, and to include market employees. *************************************************************************************** ……and finally Eliot Spitzer has left the building! I thought you might like my words about Eliot Spitzer from December 2004 in a published article: ‘Of course, when it comes to 2004 it is likely to be the Eliot Ness of our time, Eliot Spitzer, who has done much to put insurance into the public eye as a dubious group of brokers taking advantage of 'naïve' clients and underwriters. It might be OK for brokers such as Marsh to get a hefty kicking from some previously unknown civil servant in America, but he would be wise to realise the great involvement that the insurance community, particularly brokers in the US, made at the time of 11/9. Not just in staff lost but also in ensuring insurance policies were honoured and quickly. Ongoing the hurricane season in Mr Spitzer's country has been well served by the insurance market. Eliot, hopefully, has no skeletons in his cupboard and also doesn't have any hefty insurance claims in the near future!’ The latter turned out to be nearer to the truth than I had thought. *************************************************************************************** Thank you for reading. Please pass onto friends or colleagues and get them to register via my website www.rogerfoord.com . Kind regards, Roger www.rogerfoord.com 07710-479070

Line 25

Line 25

roger foord associates London and Global Insurance Systems Solutions, Marketing and PR 24 Lime Street, London EC3M 7HS Mobile: 07710-479070 e-mail: info@rogerfoord.com web: www.rogerfoord.com 27th March 2008 LINE 25– Bank holiday - Was it Easter or Christmas? Thank you for reading my newsletter.This is issue 71. Previous issues of my newsletter and articles printed can be found on my website www.rogerfoord.com ‘Latest News and Opinion’. After a wintry Easter blast in the UK there is good reason to look forward to warmer climates in London and better insurance conditions. Not too much happening at the moment to get too excited about but hopefully I have brought out some of the issues floating around at the moment. ********************************************************************* In this issue: * New members * Market technology – hubs and endorsements * No stopping Acord! * ECF brings on new ‘cv’ requirements * UK Budget does London market no favours * Lloyd’s Act – changes which need to be understood * …. and finally Eliot: it couldn’t have happened to a nicer man! *************************************************************************** Welcome to new members Keith Letchford of Sports Insurance Rama Varma of SSP Gareth Greenfield of IBM Kelli Douglas Aditya Malhotra of Flagstone Re Daniel Kapela Howard Hickey Simon Jeffrey: Dominic Miles: James Brennan: Eoin McDonagh of Highams Felicity Gill of Lan Ware Alena Kireeva of Faraday Sanjeev Vaz of Infobahn Christian Frisch of Prima Solutions Ramesch Fonseca Dean Bin-Matt of QBE Emily Howe of Bytes Technology Mark Turner Paul Petty of Bench Strength Vikram Arora of Reliance Colin Pinfield of Sterling Communications Kim Seeley of DIMA in Dublin Neil McCreadie of IPS group Laura McDonough of Willis’ Melanie Hopwood of ACE Duncan Baker of Marsh Stephen Cullum of SIPL Steve Grubbs of SSWPE ************************************************************************** Market technology – the latest big ideas A Big Hub: Interestingly the push for a strategic electronic trading platform at Lloyd’s appears to have gently disappeared. With Lloyd’s only looking to help by providing a single ‘hub’ for other’s solutions the expected ‘big bang’ is now a distant tremble. I could be wrong, and often I am, but what is proposed, apart from being a bit confusing in its message is purely a facility similar to a telephone company or water board. They supply the service and the user decides how and when to use it. I imagine that the fear factor attaching to previous efforts and their resultant ridicule has given the new...ish Lloyd’s regime time to ponder on whether to take a ‘giant step’ or not. If not why not? **************************** Electronic Endorsements: At the same time Willis’ are proposing an electronic endorsement system for London. I think that this has been previously proposed and now appears to be an emailed PDF of a formatted endorsement form. Good effort chaps but this is far from what should be happening, whereby the central bureau, XIS, need to get a handle on this issue before it is too late. This is what I said 16th August 2007 (Line 19) and nothing has changed, apart from the fact that nobody took any notice! “An area which has become apparent with Market reform is the natural thoughts of having electronic endorsements. The general principal of such a system is the same as electronic claims whereby the bureau has the information on the original slip and also the underwriter lines attaching to the slip. Currently brokers are going at this individually but what is needed is a central system managed by the central bureau XIS. If the brokers go their own ways without this central function, underwriters will find their workload increased and agreement processes confused.” Also does the market really think that email is the best way forward for its future? *************************************************************************************** ACORD get into bed with XIS The central bureau, now XIS, has had standard EDI messaging for over 20 years for its central accounting and reconciliation service to underwriters who write London ‘slip’ business. XIS who now run the central system are about to provide XML type messages also. There is a plan to provide this initially to the company underwriters, then Lloyd’s and then others. The take up will probably be over a long period of time and any compulsory use is not being discussed. If XML is to replace the current EDI messages then it will be the package suppliers who will have to make it available to their users. If it really is important to have XML then these suppliers will see it as a selling point and will fund the changes themselves. As 80% of the market in London uses a package the stimulus for change must come from them. *************************************************************************************** Insurance global conferences – carbon footprint issues, but who cares? The great and good of the insurance world were at it again last week in Dubai, griping about climate change and yet happy to travel the world stating the obvious. This year's travels for such speakers will include China, South America, South of France, and the US to name a few conference locations. At these events others travel from around the world self righteously telling the world where it is getting climate change wrong.One has to presume that most are also chauffeured to their offices in top of the range saloons, which wait parked all day until home time and back to the London suburbs. Funnily enough Aon brokers tell me that, unlike his predecessor, the new MD is a public transport supporter.Good for him. Let’s face it no terrorist is going to kidnap an insurance person. Nobody would bother to pay the ransom! In London though, as Lord Levene said at the recent Dubai insurance forum, the market is playing its part and getting rid of the Chatham van to be replaced by electronic ‘Pans’ and slips. According to Lord Levene the Chatham van transports ‘four tonnes of paper to Chatham each and every day’ (Advisen newslink 18.03.08).Sounds a bit high to me. If I knew how to, I could probably work out the extra carbon that will be generated by copying annually 1000 tonnes of documents electronically and transmitting them between brokers and underwriters. We await the squashed Chatham van to appear in the Lloyd’s lobby, as promised by the Lloyd’s CEO, with interest. ************************************************************************** ECF and the new ‘cv’ requirements It has been brought to my attention that now that ECF is in place and claims broking is a thing of the past, the ‘cv’ requirements for a London market claims person are that they must have the ability to be able to use a scanner and take paper clips and staples out of client documents. Better client service is then guaranteed. ************************************************************************** UK budget – no help to London but why should it? There were those in the insurance market who were lobbying for the government to help the London market with its tax burden (28%) ,as compared to Bermuda ( nothing %). It is difficult to see how the man in the street, who sees insurance owners in the press having millions to share with unhappy spouses or insurance companies making millions for share holders, to want to see even more money going their way. Any government, with limited tax options, is going to give to the poor not the ‘fat cats’. It will always be a message that falls on deaf political ears in London. *************************************************************************************** The Lloyd’s Act to be reformed The current Lloyd’s Act dates back to 1982. (I think this was probably the year of the second effort for electronic trading!). The current ideas are: * Lloyd’s brokers to lose exclusivity in London. There seems to be a desire to encourage all and sundry brokers to be able to write business in London. US brokers have said that such a change would be unlikely to make much difference in terms of US broker access to London. Bruce Guthart of HUB International in New York said:'..it is hard to imagine we would be able to establish the critical mass for our clients without using someone who has regular daily relationships with underwriters.' Anthony Strianse of Decus said of London:’…it is about the relationships and the people’ in London. Historically, and for the right reasons, brokers in London, apart from the relationship issue, have been tied financially into the London market. One of the big issues is that money due from clients to underwriters is paid on time by brokers. There also has to be the certainty of payment. Brokers and underwriters in London all belong to the UK central clearing bank system for all settlement currencies. Global brokers might not be able to provide this certainty, stability and timeliness for cash flow. Presumably this will be taken into account by underwriters in London when they choose to write global business from brokers outside of the UK. * Conflicts of Interest In future the requirement for brokers and managing agents to work separately will be removed but with reasonable reporting constraints. The FSA will take on this responsibility from Lloyd’s. * Lloyd’s chairman and council The Lloyd’s chairman will be able to serve nine consecutive years and the Council will be able to elect all 18 members. This supposedly will give better long term stability and also allow the current chairman to continue in his job if re-elected. * Lloyd’s Committee Evidently this is already a useless group as it has been replaced by the franchise board and its demise will not be missed. * Disciplinary committees Minor changes evidently to provide independent legally qualified input, and to include market employees. *************************************************************************************** ……and finally Eliot Spitzer has left the building! I thought you might like my words about Eliot Spitzer from December 2004 in a published article: ‘Of course, when it comes to 2004 it is likely to be the Eliot Ness of our time, Eliot Spitzer, who has done much to put insurance into the public eye as a dubious group of brokers taking advantage of 'naïve' clients and underwriters. It might be OK for brokers such as Marsh to get a hefty kicking from some previously unknown civil servant in America, but he would be wise to realise the great involvement that the insurance community, particularly brokers in the US, made at the time of 11/9. Not just in staff lost but also in ensuring insurance policies were honoured and quickly. Ongoing the hurricane season in Mr Spitzer's country has been well served by the insurance market. Eliot, hopefully, has no skeletons in his cupboard and also doesn't have any hefty insurance claims in the near future!’ The latter turned out to be nearer to the truth than I had thought. *************************************************************************************** Thank you for reading. Please pass onto friends or colleagues and get them to register via my website www.rogerfoord.com . Kind regards, Roger www.rogerfoord.com 07710-479070

roger foord associates London and Global Insurance Systems Solutions, Marketing and PR 24 Lime Street, London EC3M 7HS Mobile: 07710-479070 e-mail: info@rogerfoord.com web: www.rogerfoord.com 27th March 2008 LINE 25– Bank holiday - Was it Easter or Christmas? Thank you for reading my newsletter.This is issue 71. Previous issues of my newsletter and articles printed can be found on my website www.rogerfoord.com ‘Latest News and Opinion’. After a wintry Easter blast in the UK there is good reason to look forward to warmer climates in London and better insurance conditions. Not too much happening at the moment to get too excited about but hopefully I have brought out some of the issues floating around at the moment. ********************************************************************* In this issue: * New members * Market technology – hubs and endorsements * No stopping Acord! * ECF brings on new ‘cv’ requirements * UK Budget does London market no favours * Lloyd’s Act – changes which need to be understood * …. and finally Eliot: it couldn’t have happened to a nicer man! *************************************************************************** Welcome to new members Keith Letchford of Sports Insurance Rama Varma of SSP Gareth Greenfield of IBM Kelli Douglas Aditya Malhotra of Flagstone Re Daniel Kapela Howard Hickey Simon Jeffrey: Dominic Miles: James Brennan: Eoin McDonagh of Highams Felicity Gill of Lan Ware Alena Kireeva of Faraday Sanjeev Vaz of Infobahn Christian Frisch of Prima Solutions Ramesch Fonseca Dean Bin-Matt of QBE Emily Howe of Bytes Technology Mark Turner Paul Petty of Bench Strength Vikram Arora of Reliance Colin Pinfield of Sterling Communications Kim Seeley of DIMA in Dublin Neil McCreadie of IPS group Laura McDonough of Willis’ Melanie Hopwood of ACE Duncan Baker of Marsh Stephen Cullum of SIPL Steve Grubbs of SSWPE ************************************************************************** Market technology – the latest big ideas A Big Hub: Interestingly the push for a strategic electronic trading platform at Lloyd’s appears to have gently disappeared. With Lloyd’s only looking to help by providing a single ‘hub’ for other’s solutions the expected ‘big bang’ is now a distant tremble. I could be wrong, and often I am, but what is proposed, apart from being a bit confusing in its message is purely a facility similar to a telephone company or water board. They supply the service and the user decides how and when to use it. I imagine that the fear factor attaching to previous efforts and their resultant ridicule has given the new...ish Lloyd’s regime time to ponder on whether to take a ‘giant step’ or not. If not why not? **************************** Electronic Endorsements: At the same time Willis’ are proposing an electronic endorsement system for London. I think that this has been previously proposed and now appears to be an emailed PDF of a formatted endorsement form. Good effort chaps but this is far from what should be happening, whereby the central bureau, XIS, need to get a handle on this issue before it is too late. This is what I said 16th August 2007 (Line 19) and nothing has changed, apart from the fact that nobody took any notice! “An area which has become apparent with Market reform is the natural thoughts of having electronic endorsements. The general principal of such a system is the same as electronic claims whereby the bureau has the information on the original slip and also the underwriter lines attaching to the slip. Currently brokers are going at this individually but what is needed is a central system managed by the central bureau XIS. If the brokers go their own ways without this central function, underwriters will find their workload increased and agreement processes confused.” Also does the market really think that email is the best way forward for its future? *************************************************************************************** ACORD get into bed with XIS The central bureau, now XIS, has had standard EDI messaging for over 20 years for its central accounting and reconciliation service to underwriters who write London ‘slip’ business. XIS who now run the central system are about to provide XML type messages also. There is a plan to provide this initially to the company underwriters, then Lloyd’s and then others. The take up will probably be over a long period of time and any compulsory use is not being discussed. If XML is to replace the current EDI messages then it will be the package suppliers who will have to make it available to their users. If it really is important to have XML then these suppliers will see it as a selling point and will fund the changes themselves. As 80% of the market in London uses a package the stimulus for change must come from them. *************************************************************************************** Insurance global conferences – carbon footprint issues, but who cares? The great and good of the insurance world were at it again last week in Dubai, griping about climate change and yet happy to travel the world stating the obvious. This year's travels for such speakers will include China, South America, South of France, and the US to name a few conference locations. At these events others travel from around the world self righteously telling the world where it is getting climate change wrong.One has to presume that most are also chauffeured to their offices in top of the range saloons, which wait parked all day until home time and back to the London suburbs. Funnily enough Aon brokers tell me that, unlike his predecessor, the new MD is a public transport supporter.Good for him. Let’s face it no terrorist is going to kidnap an insurance person. Nobody would bother to pay the ransom! In London though, as Lord Levene said at the recent Dubai insurance forum, the market is playing its part and getting rid of the Chatham van to be replaced by electronic ‘Pans’ and slips. According to Lord Levene the Chatham van transports ‘four tonnes of paper to Chatham each and every day’ (Advisen newslink 18.03.08).Sounds a bit high to me. If I knew how to, I could probably work out the extra carbon that will be generated by copying annually 1000 tonnes of documents electronically and transmitting them between brokers and underwriters. We await the squashed Chatham van to appear in the Lloyd’s lobby, as promised by the Lloyd’s CEO, with interest. ************************************************************************** ECF and the new ‘cv’ requirements It has been brought to my attention that now that ECF is in place and claims broking is a thing of the past, the ‘cv’ requirements for a London market claims person are that they must have the ability to be able to use a scanner and take paper clips and staples out of client documents. Better client service is then guaranteed. ************************************************************************** UK budget – no help to London but why should it? There were those in the insurance market who were lobbying for the government to help the London market with its tax burden (28%) ,as compared to Bermuda ( nothing %). It is difficult to see how the man in the street, who sees insurance owners in the press having millions to share with unhappy spouses or insurance companies making millions for share holders, to want to see even more money going their way. Any government, with limited tax options, is going to give to the poor not the ‘fat cats’. It will always be a message that falls on deaf political ears in London. *************************************************************************************** The Lloyd’s Act to be reformed The current Lloyd’s Act dates back to 1982. (I think this was probably the year of the second effort for electronic trading!). The current ideas are: * Lloyd’s brokers to lose exclusivity in London. There seems to be a desire to encourage all and sundry brokers to be able to write business in London. US brokers have said that such a change would be unlikely to make much difference in terms of US broker access to London. Bruce Guthart of HUB International in New York said:'..it is hard to imagine we would be able to establish the critical mass for our clients without using someone who has regular daily relationships with underwriters.' Anthony Strianse of Decus said of London:’…it is about the relationships and the people’ in London. Historically, and for the right reasons, brokers in London, apart from the relationship issue, have been tied financially into the London market. One of the big issues is that money due from clients to underwriters is paid on time by brokers. There also has to be the certainty of payment. Brokers and underwriters in London all belong to the UK central clearing bank system for all settlement currencies. Global brokers might not be able to provide this certainty, stability and timeliness for cash flow. Presumably this will be taken into account by underwriters in London when they choose to write global business from brokers outside of the UK. * Conflicts of Interest In future the requirement for brokers and managing agents to work separately will be removed but with reasonable reporting constraints. The FSA will take on this responsibility from Lloyd’s. * Lloyd’s chairman and council The Lloyd’s chairman will be able to serve nine consecutive years and the Council will be able to elect all 18 members. This supposedly will give better long term stability and also allow the current chairman to continue in his job if re-elected. * Lloyd’s Committee Evidently this is already a useless group as it has been replaced by the franchise board and its demise will not be missed. * Disciplinary committees Minor changes evidently to provide independent legally qualified input, and to include market employees. *************************************************************************************** ……and finally Eliot Spitzer has left the building! I thought you might like my words about Eliot Spitzer from December 2004 in a published article: ‘Of course, when it comes to 2004 it is likely to be the Eliot Ness of our time, Eliot Spitzer, who has done much to put insurance into the public eye as a dubious group of brokers taking advantage of 'naïve' clients and underwriters. It might be OK for brokers such as Marsh to get a hefty kicking from some previously unknown civil servant in America, but he would be wise to realise the great involvement that the insurance community, particularly brokers in the US, made at the time of 11/9. Not just in staff lost but also in ensuring insurance policies were honoured and quickly. Ongoing the hurricane season in Mr Spitzer's country has been well served by the insurance market. Eliot, hopefully, has no skeletons in his cupboard and also doesn't have any hefty insurance claims in the near future!’ The latter turned out to be nearer to the truth than I had thought. *************************************************************************************** Thank you for reading. Please pass onto friends or colleagues and get them to register via my website www.rogerfoord.com . Kind regards, Roger www.rogerfoord.com 07710-479070

Line 25

roger foord associates London and Global Insurance Systems Solutions, Marketing and PR 24 Lime Street, London EC3M 7HS Mobile: 07710-479070 e-mail: info@rogerfoord.com web: www.rogerfoord.com 27th March 2008 LINE 25– Bank holiday - Was it Easter or Christmas? Thank you for reading my newsletter.This is issue 71. Previous issues of my newsletter and articles printed can be found on my website www.rogerfoord.com ‘Latest News and Opinion’. After a wintry Easter blast in the UK there is good reason to look forward to warmer climates in London and better insurance conditions. Not too much happening at the moment to get too excited about but hopefully I have brought out some of the issues floating around at the moment. ********************************************************************* In this issue: * New members * Market technology – hubs and endorsements * No stopping Acord! * ECF brings on new ‘cv’ requirements * UK Budget does London market no favours * Lloyd’s Act – changes which need to be understood * …. and finally Eliot: it couldn’t have happened to a nicer man! *************************************************************************** Welcome to new members Keith Letchford of Sports Insurance Rama Varma of SSP Gareth Greenfield of IBM Kelli Douglas Aditya Malhotra of Flagstone Re Daniel Kapela Howard Hickey Simon Jeffrey: Dominic Miles: James Brennan: Eoin McDonagh of Highams Felicity Gill of Lan Ware Alena Kireeva of Faraday Sanjeev Vaz of Infobahn Christian Frisch of Prima Solutions Ramesch Fonseca Dean Bin-Matt of QBE Emily Howe of Bytes Technology Mark Turner Paul Petty of Bench Strength Vikram Arora of Reliance Colin Pinfield of Sterling Communications Kim Seeley of DIMA in Dublin Neil McCreadie of IPS group Laura McDonough of Willis’ Melanie Hopwood of ACE Duncan Baker of Marsh Stephen Cullum of SIPL Steve Grubbs of SSWPE ************************************************************************** Market technology – the latest big ideas A Big Hub: Interestingly the push for a strategic electronic trading platform at Lloyd’s appears to have gently disappeared. With Lloyd’s only looking to help by providing a single ‘hub’ for other’s solutions the expected ‘big bang’ is now a distant tremble. I could be wrong, and often I am, but what is proposed, apart from being a bit confusing in its message is purely a facility similar to a telephone company or water board. They supply the service and the user decides how and when to use it. I imagine that the fear factor attaching to previous efforts and their resultant ridicule has given the new...ish Lloyd’s regime time to ponder on whether to take a ‘giant step’ or not. If not why not? **************************** Electronic Endorsements: At the same time Willis’ are proposing an electronic endorsement system for London. I think that this has been previously proposed and now appears to be an emailed PDF of a formatted endorsement form. Good effort chaps but this is far from what should be happening, whereby the central bureau, XIS, need to get a handle on this issue before it is too late. This is what I said 16th August 2007 (Line 19) and nothing has changed, apart from the fact that nobody took any notice! “An area which has become apparent with Market reform is the natural thoughts of having electronic endorsements. The general principal of such a system is the same as electronic claims whereby the bureau has the information on the original slip and also the underwriter lines attaching to the slip. Currently brokers are going at this individually but what is needed is a central system managed by the central bureau XIS. If the brokers go their own ways without this central function, underwriters will find their workload increased and agreement processes confused.” Also does the market really think that email is the best way forward for its future? *************************************************************************************** ACORD get into bed with XIS The central bureau, now XIS, has had standard EDI messaging for over 20 years for its central accounting and reconciliation service to underwriters who write London ‘slip’ business. XIS who now run the central system are about to provide XML type messages also. There is a plan to provide this initially to the company underwriters, then Lloyd’s and then others. The take up will probably be over a long period of time and any compulsory use is not being discussed. If XML is to replace the current EDI messages then it will be the package suppliers who will have to make it available to their users. If it really is important to have XML then these suppliers will see it as a selling point and will fund the changes themselves. As 80% of the market in London uses a package the stimulus for change must come from them. *************************************************************************************** Insurance global conferences – carbon footprint issues, but who cares? The great and good of the insurance world were at it again last week in Dubai, griping about climate change and yet happy to travel the world stating the obvious. This year's travels for such speakers will include China, South America, South of France, and the US to name a few conference locations. At these events others travel from around the world self righteously telling the world where it is getting climate change wrong.One has to presume that most are also chauffeured to their offices in top of the range saloons, which wait parked all day until home time and back to the London suburbs. Funnily enough Aon brokers tell me that, unlike his predecessor, the new MD is a public transport supporter.Good for him. Let’s face it no terrorist is going to kidnap an insurance person. Nobody would bother to pay the ransom! In London though, as Lord Levene said at the recent Dubai insurance forum, the market is playing its part and getting rid of the Chatham van to be replaced by electronic ‘Pans’ and slips. According to Lord Levene the Chatham van transports ‘four tonnes of paper to Chatham each and every day’ (Advisen newslink 18.03.08).Sounds a bit high to me. If I knew how to, I could probably work out the extra carbon that will be generated by copying annually 1000 tonnes of documents electronically and transmitting them between brokers and underwriters. We await the squashed Chatham van to appear in the Lloyd’s lobby, as promised by the Lloyd’s CEO, with interest. ************************************************************************** ECF and the new ‘cv’ requirements It has been brought to my attention that now that ECF is in place and claims broking is a thing of the past, the ‘cv’ requirements for a London market claims person are that they must have the ability to be able to use a scanner and take paper clips and staples out of client documents. Better client service is then guaranteed. ************************************************************************** UK budget – no help to London but why should it? There were those in the insurance market who were lobbying for the government to help the London market with its tax burden (28%) ,as compared to Bermuda ( nothing %). It is difficult to see how the man in the street, who sees insurance owners in the press having millions to share with unhappy spouses or insurance companies making millions for share holders, to want to see even more money going their way. Any government, with limited tax options, is going to give to the poor not the ‘fat cats’. It will always be a message that falls on deaf political ears in London. *************************************************************************************** The Lloyd’s Act to be reformed The current Lloyd’s Act dates back to 1982. (I think this was probably the year of the second effort for electronic trading!). The current ideas are: * Lloyd’s brokers to lose exclusivity in London. There seems to be a desire to encourage all and sundry brokers to be able to write business in London. US brokers have said that such a change would be unlikely to make much difference in terms of US broker access to London. Bruce Guthart of HUB International in New York said:'..it is hard to imagine we would be able to establish the critical mass for our clients without using someone who has regular daily relationships with underwriters.' Anthony Strianse of Decus said of London:’…it is about the relationships and the people’ in London. Historically, and for the right reasons, brokers in London, apart from the relationship issue, have been tied financially into the London market. One of the big issues is that money due from clients to underwriters is paid on time by brokers. There also has to be the certainty of payment. Brokers and underwriters in London all belong to the UK central clearing bank system for all settlement currencies. Global brokers might not be able to provide this certainty, stability and timeliness for cash flow. Presumably this will be taken into account by underwriters in London when they choose to write global business from brokers outside of the UK. * Conflicts of Interest In future the requirement for brokers and managing agents to work separately will be removed but with reasonable reporting constraints. The FSA will take on this responsibility from Lloyd’s. * Lloyd’s chairman and council The Lloyd’s chairman will be able to serve nine consecutive years and the Council will be able to elect all 18 members. This supposedly will give better long term stability and also allow the current chairman to continue in his job if re-elected. * Lloyd’s Committee Evidently this is already a useless group as it has been replaced by the franchise board and its demise will not be missed. * Disciplinary committees Minor changes evidently to provide independent legally qualified input, and to include market employees. *************************************************************************************** ……and finally Eliot Spitzer has left the building! I thought you might like my words about Eliot Spitzer from December 2004 in a published article: ‘Of course, when it comes to 2004 it is likely to be the Eliot Ness of our time, Eliot Spitzer, who has done much to put insurance into the public eye as a dubious group of brokers taking advantage of 'naïve' clients and underwriters. It might be OK for brokers such as Marsh to get a hefty kicking from some previously unknown civil servant in America, but he would be wise to realise the great involvement that the insurance community, particularly brokers in the US, made at the time of 11/9. Not just in staff lost but also in ensuring insurance policies were honoured and quickly. Ongoing the hurricane season in Mr Spitzer's country has been well served by the insurance market. Eliot, hopefully, has no skeletons in his cupboard and also doesn't have any hefty insurance claims in the near future!’ The latter turned out to be nearer to the truth than I had thought. *************************************************************************************** Thank you for reading. Please pass onto friends or colleagues and get them to register via my website www.rogerfoord.com . Kind regards, Roger www.rogerfoord.com 07710-479070

roger foord associates London and Global Insurance Systems Solutions, Marketing and PR 24 Lime Street, London EC3M 7HS Mobile: 07710-479070 e-mail: info@rogerfoord.com web: www.rogerfoord.com 27th March 2008 LINE 25– Bank holiday - Was it Easter or Christmas? Thank you for reading my newsletter.This is issue 71. Previous issues of my newsletter and articles printed can be found on my website www.rogerfoord.com ‘Latest News and Opinion’. After a wintry Easter blast in the UK there is good reason to look forward to warmer climates in London and better insurance conditions. Not too much happening at the moment to get too excited about but hopefully I have brought out some of the issues floating around at the moment. ********************************************************************* In this issue: * New members * Market technology – hubs and endorsements * No stopping Acord! * ECF brings on new ‘cv’ requirements * UK Budget does London market no favours * Lloyd’s Act – changes which need to be understood * …. and finally Eliot: it couldn’t have happened to a nicer man! *************************************************************************** Welcome to new members Keith Letchford of Sports Insurance Rama Varma of SSP Gareth Greenfield of IBM Kelli Douglas Aditya Malhotra of Flagstone Re Daniel Kapela Howard Hickey Simon Jeffrey: Dominic Miles: James Brennan: Eoin McDonagh of Highams Felicity Gill of Lan Ware Alena Kireeva of Faraday Sanjeev Vaz of Infobahn Christian Frisch of Prima Solutions Ramesch Fonseca Dean Bin-Matt of QBE Emily Howe of Bytes Technology Mark Turner Paul Petty of Bench Strength Vikram Arora of Reliance Colin Pinfield of Sterling Communications Kim Seeley of DIMA in Dublin Neil McCreadie of IPS group Laura McDonough of Willis’ Melanie Hopwood of ACE Duncan Baker of Marsh Stephen Cullum of SIPL Steve Grubbs of SSWPE ************************************************************************** Market technology – the latest big ideas A Big Hub: Interestingly the push for a strategic electronic trading platform at Lloyd’s appears to have gently disappeared. With Lloyd’s only looking to help by providing a single ‘hub’ for other’s solutions the expected ‘big bang’ is now a distant tremble. I could be wrong, and often I am, but what is proposed, apart from being a bit confusing in its message is purely a facility similar to a telephone company or water board. They supply the service and the user decides how and when to use it. I imagine that the fear factor attaching to previous efforts and their resultant ridicule has given the new...ish Lloyd’s regime time to ponder on whether to take a ‘giant step’ or not. If not why not? **************************** Electronic Endorsements: At the same time Willis’ are proposing an electronic endorsement system for London. I think that this has been previously proposed and now appears to be an emailed PDF of a formatted endorsement form. Good effort chaps but this is far from what should be happening, whereby the central bureau, XIS, need to get a handle on this issue before it is too late. This is what I said 16th August 2007 (Line 19) and nothing has changed, apart from the fact that nobody took any notice! “An area which has become apparent with Market reform is the natural thoughts of having electronic endorsements. The general principal of such a system is the same as electronic claims whereby the bureau has the information on the original slip and also the underwriter lines attaching to the slip. Currently brokers are going at this individually but what is needed is a central system managed by the central bureau XIS. If the brokers go their own ways without this central function, underwriters will find their workload increased and agreement processes confused.” Also does the market really think that email is the best way forward for its future? *************************************************************************************** ACORD get into bed with XIS The central bureau, now XIS, has had standard EDI messaging for over 20 years for its central accounting and reconciliation service to underwriters who write London ‘slip’ business. XIS who now run the central system are about to provide XML type messages also. There is a plan to provide this initially to the company underwriters, then Lloyd’s and then others. The take up will probably be over a long period of time and any compulsory use is not being discussed. If XML is to replace the current EDI messages then it will be the package suppliers who will have to make it available to their users. If it really is important to have XML then these suppliers will see it as a selling point and will fund the changes themselves. As 80% of the market in London uses a package the stimulus for change must come from them. *************************************************************************************** Insurance global conferences – carbon footprint issues, but who cares? The great and good of the insurance world were at it again last week in Dubai, griping about climate change and yet happy to travel the world stating the obvious. This year's travels for such speakers will include China, South America, South of France, and the US to name a few conference locations. At these events others travel from around the world self righteously telling the world where it is getting climate change wrong.One has to presume that most are also chauffeured to their offices in top of the range saloons, which wait parked all day until home time and back to the London suburbs. Funnily enough Aon brokers tell me that, unlike his predecessor, the new MD is a public transport supporter.Good for him. Let’s face it no terrorist is going to kidnap an insurance person. Nobody would bother to pay the ransom! In London though, as Lord Levene said at the recent Dubai insurance forum, the market is playing its part and getting rid of the Chatham van to be replaced by electronic ‘Pans’ and slips. According to Lord Levene the Chatham van transports ‘four tonnes of paper to Chatham each and every day’ (Advisen newslink 18.03.08).Sounds a bit high to me. If I knew how to, I could probably work out the extra carbon that will be generated by copying annually 1000 tonnes of documents electronically and transmitting them between brokers and underwriters. We await the squashed Chatham van to appear in the Lloyd’s lobby, as promised by the Lloyd’s CEO, with interest. ************************************************************************** ECF and the new ‘cv’ requirements It has been brought to my attention that now that ECF is in place and claims broking is a thing of the past, the ‘cv’ requirements for a London market claims person are that they must have the ability to be able to use a scanner and take paper clips and staples out of client documents. Better client service is then guaranteed. ************************************************************************** UK budget – no help to London but why should it? There were those in the insurance market who were lobbying for the government to help the London market with its tax burden (28%) ,as compared to Bermuda ( nothing %). It is difficult to see how the man in the street, who sees insurance owners in the press having millions to share with unhappy spouses or insurance companies making millions for share holders, to want to see even more money going their way. Any government, with limited tax options, is going to give to the poor not the ‘fat cats’. It will always be a message that falls on deaf political ears in London. *************************************************************************************** The Lloyd’s Act to be reformed The current Lloyd’s Act dates back to 1982. (I think this was probably the year of the second effort for electronic trading!). The current ideas are: * Lloyd’s brokers to lose exclusivity in London. There seems to be a desire to encourage all and sundry brokers to be able to write business in London. US brokers have said that such a change would be unlikely to make much difference in terms of US broker access to London. Bruce Guthart of HUB International in New York said:'..it is hard to imagine we would be able to establish the critical mass for our clients without using someone who has regular daily relationships with underwriters.' Anthony Strianse of Decus said of London:’…it is about the relationships and the people’ in London. Historically, and for the right reasons, brokers in London, apart from the relationship issue, have been tied financially into the London market. One of the big issues is that money due from clients to underwriters is paid on time by brokers. There also has to be the certainty of payment. Brokers and underwriters in London all belong to the UK central clearing bank system for all settlement currencies. Global brokers might not be able to provide this certainty, stability and timeliness for cash flow. Presumably this will be taken into account by underwriters in London when they choose to write global business from brokers outside of the UK. * Conflicts of Interest In future the requirement for brokers and managing agents to work separately will be removed but with reasonable reporting constraints. The FSA will take on this responsibility from Lloyd’s. * Lloyd’s chairman and council The Lloyd’s chairman will be able to serve nine consecutive years and the Council will be able to elect all 18 members. This supposedly will give better long term stability and also allow the current chairman to continue in his job if re-elected. * Lloyd’s Committee Evidently this is already a useless group as it has been replaced by the franchise board and its demise will not be missed. * Disciplinary committees Minor changes evidently to provide independent legally qualified input, and to include market employees. *************************************************************************************** ……and finally Eliot Spitzer has left the building! I thought you might like my words about Eliot Spitzer from December 2004 in a published article: ‘Of course, when it comes to 2004 it is likely to be the Eliot Ness of our time, Eliot Spitzer, who has done much to put insurance into the public eye as a dubious group of brokers taking advantage of 'naïve' clients and underwriters. It might be OK for brokers such as Marsh to get a hefty kicking from some previously unknown civil servant in America, but he would be wise to realise the great involvement that the insurance community, particularly brokers in the US, made at the time of 11/9. Not just in staff lost but also in ensuring insurance policies were honoured and quickly. Ongoing the hurricane season in Mr Spitzer's country has been well served by the insurance market. Eliot, hopefully, has no skeletons in his cupboard and also doesn't have any hefty insurance claims in the near future!’ The latter turned out to be nearer to the truth than I had thought. *************************************************************************************** Thank you for reading. Please pass onto friends or colleagues and get them to register via my website www.rogerfoord.com . Kind regards, Roger www.rogerfoord.com 07710-479070

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