The Carrier’s Perspective Transforming Insurance Operations Simon Squires - CPO Regional Manager International P&C, XL Insurance March 2015
24pt 20pt The London Insurance Company Market al t 18pt 18pt 16pt o IUA – 40 members plus other London Companies al o Non Bureau - Direct relationships with clients & intermediaries – £7 bn net pure London Market business o Global organisations - global networks – global processes o Desire to leverage efficiencies in transaction validation and payment cycles
24pt 20pt Implementation Communities al t 18pt Continental 18pt United States United Europe 16pt & Canada Kingdom al Bermuda Asia South America Australia Africa
24pt A new way of doing things – Creating the Opportunity 20pt al t CLIENT SERVICE CONSISTENCY 18pt • 6 Faster timelines • Global Standards 1 • Improved data quality • Process Guidelines 18pt 16pt al COMMUNITY Transformational COMPETITIVENESS • 5 2 Global Stewardship Change • Process Efficiency • Local Implementations • Effective Costs COLLABORATION CREATE VALUE • Working together • Common Language 4 3 • Creating Opportunity • Faster Communication
24pt 20pt Providing Best Practices al t 18pt Message Standards, flows and interactions 18pt Workflow timing recommendation 16pt Document Exchange Standards al Recommended implementation steps Minimum connectivity requirements Target Performance Standards Continuous improvement of processing time
24pt 20pt Our Story al t 18pt – Commenced with two brokers in Q4 18pt 2011- we were the pioneers here in the insurance sector, now trading with six 16pt al and planning three more – Now 10000 messages later and live with six brokers now covering over 65% of the UK portfolio – Premiums move 30% faster, claim payments 40%, process efficiency improved by around 30% and elimination of unallocated cash – Globally this is how efficient & modern insurance organisations now manage operations – Key new go-lives in Singapore and New York in 2014 – Key plans:- coinsurance messaging, integration to Genius, retail sector coverage, European & further global coverage, working with Lloyd’s to adopt EBOT as one global insurance standard
24pt 20pt CURRENT STATE PROCESSING WITHOUT MESSAGING al t 18pt 18pt 16pt al Paper / E-mail Closings Manual Statements Delayed Payments - Incomplete documents -Time consuming spreadsheet - Inconsistent due dates - Non standard formats process - Timeline driven by - No ackowledgement of - Lengthy agreement reconciliation receipt required timecycle - No agreement of items - Large query volumes payable
24pt 20pt FUTURE STATE PROCESSING WITH MESSAGING al t 18pt 18pt 16pt al Transaction validation Electronic Reconciliation Faster Cashflow - Tech account (TA) message - Real time agreement - Items paid 15 working days sent early, as soon as the - Technical/payment earlier broker books the item transaction linked - No backlogs - can focus on - Standard data format - Team can focus on queried/ key items - Complete/accurate dataset unpaid items. - Financial account (FA) sent - Early query resolution as soon as payable
24pt Case Study 1 – Simple Complexity Risk – ACORD 2008 20pt al t 18pt 18pt 16pt al
24pt Case Study 2 – High Complexity Risk – ACORD 2010 20pt al t 18pt 18pt 16pt al Tax and territory splits in the 2010 message
24pt The Administrative Lifecycle -Company/Broker Transactions – Past v Future 20pt al t 18pt APRIL MAY JUNE 18pt 16pt Broker al Events Booked Broker System 08/04 Inception Date 01/04 Client Paid 17/05 Paper Closing arrives at Broker Statement Issued Broker Settlement FA Issued Insurer 04/06 14/06 18/05 Insurer Events Accepted 10/04 TA Issued 9/04 FA Accepted 19/05 Settlement 20/05 Electronic Events Electronic Technical Electronic Financial Account Message Account Message and settlement
24pt TECHNICAL 20pt al ACCOUNT t MESSAGE 18pt TA BENEFITS – THE CHECKLIST 18pt 1. Complete data set 16pt received within 24 hours of al broker entry 2. Up front benefits - early validation , improved processing 3. Supports back office integration 4. Fast query turnaround (10 day target) 5. Better communication 6. Aggregated data and improved MI 7. Integrated standard processes
24pt FINANCIAL 20pt al ACCOUNT t MESSAGE 18pt FA BENEFITS – THE CHECKLIST 18pt 1. FA messages batched by 16pt account al 2. Insurer/Broker agreed settlement frequency 3. Integral links between TA & FA 4. Accept/Reject process - >95% agreement rates 5. Payments will always agree to transfer 6. (Semi) Electronic reconciliation process 7. Facilitates 15 business day collection improvement
24pt 20pt Claims Payment Message al t 18pt o Speeds up claims payment agreement process in similar way to premium cycle 18pt o Provides a solution for correcting claims references 16pt al o Delivers a structured approach to accessing supporting documents o Facilitates accounts administration of premiums and claims in one department o Reduces the need to make large numbers of individual payments o Frees the claims handlers to focus on managing the claims Delivering on the promise to provide certainty in an uncertain world
24pt What next for e-Accounting? 20pt al t Insurance Reinsurance 18pt 18pt Insurer 16pt 6 Co-Insurer al 2 3 Reinsurer Reinsurance 5 7 Broker Insurance 1 2 5 Broker Insured 6 Insurer 1 (internal 8 reinsurer) 4 Insurer (or Lead Reinsurance 8 Co-Insurer) Broker 1. Insurance underwriting, direct or via broker 1 2. Insurance broker placement 2 8 3. Co-insurance placement 3 4. Internal reinsurance 4 5. Reinsurance via broker 5 Reinsurer 6. Direct reinsurance 6 (Retrocessionnaire) 7. Reinsurance broker placement 7 8. Retrocession via broker or not 8
24pt 20pt al The Right Approach t 18pt 18pt 16pt al
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