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In the second of a three-part Q&A series, Joe Dainty, Global Head of Operations at Lloyd’s of London, outlines the latest developments in the TOM programme and its collaboration with Ruschlikon.
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LM TOM: working with Ruschlikon

Ruschlikon Marketing Group: Ruschlikon aims to simplify and streamline the administration of commercial and reinsurance business – doesn’t Central Services Refresh Programme (CSRP) have a similar aim? So why both initiatives?

Joe Dainty (JD): Both solutions are looking to achieve the same outcome – but the London Market has a key structural difference in that it has a central bureau - supporting a subscription market and processing submissions from a single broker to multiple carriers. Ruschlikon, by contract, is a peer-to-peer messaging model between a single broker and a single carrier. 

The bureau model incorporates processes that are unique to London and which do not occur in Ruschlikon. These include collaborative claims agreement schemes (one carrier agreeing claims on behalf of other carriers); service company business for Lloyd’s syndicates and net settlement facilities. So, there needs to be a solution to meet these specific needs. 

However, wherever possible we are looking to align the processes to ensure they are identical. It’s all about a single way of working globally and reducing the barriers to entry to the London Market. Both initiatives are working very closely together to ensure they are aligned. Ruschlikon members on the TOM CSRP groups and vice versa for Ruschlikon groups (Business Implementation Group [BIG] / Steering group / Ruschlikon UK Implementation Group [RUKIG]).

Ruschlikon has defined some best practices around processes, operational performance, speed of interaction, etc, does CSRP intend to introduce similar best practices or are these already in place?

JD: The London Market operates similar performance measures that include guidelines for brokers and carriers as well as CSRP. All of the existing measurements would satisfy the Ruschlikon best practices, and we are aligning CSRP to these best practices wherever possible, they only differ when absolutely necessary taking into account the differences in communities i.e. the bureau.

CSRP has published a user guide for the bureau interaction, and it is hosted within the ACORD domain in order to protect ACORD intellectual property. Ruschlikon also has had sight of all business process documents and signed off all proposed enhancement to the messages – members of the Ruschlikon Steering Group and BIG are supporting the TOM initiative, and make a valuable contribution that ensures the processes for Ruschlikon and CSRP are closely aligned.

What are the greatest challenges in adopting CSRP objectives - systems, structure, people or culture?

JD: The greatest challenge is existing systems and structure (legacy systems and the bureau element) but we are making good progress in addressing those. 

Changing people’s behaviour and perceptions are also vitally important – our challenge now is to get understanding and adoption filtered throughout the London Market. 

The phased rollout of CSRP will help to get buy-in for the initiative, and the broker portal will remove barriers to entry, as it is a simple and inexpensive solution.

The greatest challenge is providing a roadmap that allows all London market participants to progress at their own pace. The initial phases of CSRP provide the ability for brokers to migrate to the new processes, and most of the Ruschlikon brokers are already developing solutions for CSRP.

Future phases will provide similar facilities for carriers, and will allow them to receive Ruschlikon messages for all of their bureau business.

Standardisation of processes and data appears to be a key when modernising the insurance markets – what is the role of ACORD in this context?

JD: By removing paper and moving to a digital world so that we can deliver straight through processing, and globally recognised (re)insurance standards are vital for this transition. ACORD is a key component for us in our modernisation efforts.

ACORD provides the governance to ensure standards are global and that we don’t introduce anything that creates more cost or complexity when dealing with London.

ACORD provide the technical expertise, and often the time and resources, for developing new processes. They facilitate discussion between the interested parties and ensure all relevant communities are engaged and/or informed of updates.

Dealing with the London Market has traditionally required a knowledge of unique and historical systems. Does using ACORD messaging for CSRP reduce or eliminate the need for these?

JD: The use of ACORD messaging within CSRP significantly reduces the need for London Market knowledge.

The implementation of CSRP will align current London processes to global standards, and specific London systems will be replaced with ACORD global EBOT and ECOT messages. There are still a few variances, but the most significant differences in documentation and data have been removed.