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© Lloyd’s 2012
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Welcome to the Lloyd’s Data & Intelligence Day We’d like to thank our colleagues who helped to organise the event:
© Lloyd’s 2012
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Mac Castro – Events
Denise Cunningham – Events
Kay Smith – Hospitality & Events
Matt Quirke – ITG
John McGuinness – ITG
Geraldine Moynihan – Relationship Management
Lloyd’s Cloakroom
Lloyd’s Reception
We’d like to thank our colleagues who helped to organise the event:
© Lloyd’s
Data Day Agenda
3
13.15 -14.00 Lightning Talks (Session 1)
Shirine Khoury-Haq / Data Day teams
14.40 - 15.00 ISO Services – What does it mean for the
Lloyd’s Market?
Chris Kent, Verisk
15.15- 16.00 Lightning Talks (Session 2)
Shirine Khoury-Haq / Data Day teams
16.40 - 17.00 Defining Claims Inflation
Markus Gesmann - Analysis
© Lloyd’s
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Lloyd’s Data & Intelligence Day Lightning Talks
14 October 2015
© Lloyd’s
Agenda 1. Analysis – Davide De March
2. Business Intelligence – Anthony Balfe
3. Claims – Andrew Johnson
4. Delegated Authorities – Adam Davis
5. Exposure Management – Danial Khan
6. LITA – David Franco
7. LMA – Neil Roberts
8. LMA / Verisk – Chris Kent
9. Market Intelligence – Bruno Davilla
10. Market Reserving & Capital – Varuna Porter
11. Strategy & Investor Relations – Tom Allebone-Webb
12. Target Operating Model – Helen Crooks
© Lloyd’s 6 © Lloyd’s 6
PMD – Analysis Davide De March
14 October 2015
© Lloyd’s 7
► The analysis team develops new approaches to
provide you with more detailed information
about the Lloyd’s Market.
► Today:
– The new Non-Core Market Return (NCMR)
– Black dots evaluation
– Planning Support Tool (PST)
Analysis and research on Lloyd’s data
© Lloyd’s 8
The Core Market Return Guidebook
• Overview for the completion of
CMR
• How Lloyd’s use the
information…
© Lloyd’s 9
The Non-Core Market Return Guidebook
…and for data collections outside the
CMR, new from this year:
NON-CORE MARKET RETURN
Guidebook
• General Returns
• Tax Returns
• Regional Returns
www.lloyds.com/Data
© Lloyd’s 10
Defining Risk Appetite
better
Performance vs. peers
Perf
orm
ance v
s. pla
n
worse
wo
rse
b
ett
er
© Lloyd’s 11
From pi-pack to black dots
© Lloyd’s 12
The black dots evaluation
– Used to evaluate if
syndicates are
underperforming
– Used to measure
performance
against risk
appetite
– Updated on
Quarterly bases
– Used by Planning
Support Tool as a
credibility index for
syndicates
Key: Number of years of account a syndicate is underperforming for the years
of account 2012 – 2014
3 years vs. plan & peers & CR >100 3 years vs. plan
2 years vs. plan < 2 years vs. plan
Notional Market Gross Combined Ratio - Actual Gross Combined Ratio (%)
Pla
n G
UL
R -
Actu
al G
UL
R (
%)
-60
-50
-40
-30
-20
-10
0
10
20
30
40
50
60
Better than market
Better than plan
2012
Better than market
Better than plan
2013
-60
-50
-40
-30
-20
-10
0
10
20
30
40
50
60
-60 -40 -20 0 10 20 30 40 50 60
Better than market
Better than plan
2014
-60 -40 -20 0 10 20 30 40 50 60
Better than market
Better than plan
2015
© Lloyd’s 13
► It’s a systematic approach to find “unrealistic”
planning assumptions.
► It’s a tool to consistently review the SBF
assumptions.
Planning support tool approach
CPG
SBF
Historical
Perfor-mance
© Lloyd’s 14
Outcomes of PST
very unlikely assumption
unlikely assumption
likely assumption
PST
CPG
SBF
Historical
Perfor-mance
© Lloyd’s 15
PMD - Analysis Team
Contacts:
Davide De March: [email protected]
Markus Gesmann: [email protected]
Meet us at Table 1
© Lloyd’s
Business Intelligence Team
Speaker: Anthony Balfe
Business Intelligence Team
Performance Management Directorate
Topics: • PMDr changes
• Existing & New MI Reports available
© Lloyd’s
PMDr changes
► Key Facts:
Focus on ‘Gross’ data
Changes to template implemented in Jan 2016 return
Changes have already been circulated (market bulletin
Y4897, updated instructions on CMR)
New fields added to PMDr template (coverholder info,
acquisitions costs)
Some fields amended
© Lloyd’s
PMDR Template – New Fields
Field Names Field Number Single Risk Flag 10
Expiring UMR 20
Expiring Syndicate Risk ID 30
Current UMR 40
Current Syndicate Risk ID 50
Syndicate Class of Business Code 60
Risk Code 70
Inception Date 80
Expiry Date 90
Risk Exposure Location Code 100
Domicile of the Insured 105
Lloyd's Slip Leader Flag 110
Distribution Channel Code 120
Coverholder PIN 125
Method of Placement Code 130
Service Company Indicator 135
Original Currency Code 140
Expiring Syndicate Gross Written Premium 150
Current Syndicate Gross Written Premium 160
Current Syndicate Acquisition Costs 160a
Expiring 100% Gross Written Premium 170
Expiring 100% Acquisition Costs 170a
Change in Expiring 100% Gross Written Premium Due to Change in Deductible / Attachment Point 180
Change in Expiring 100% Gross Written Premium Due to Change in Breadth of Cover 190
Change in Expiring 100% Gross Written Premium Due to Other Factors 200
Change in Expiring 100% Gross Written Premium Due to Pure Rate Change 210
Current 100% Gross Written Premium 220
Current 100% Acquisitions Costs 220a
Current 100% Benchmark Price 230
Expiring Renewed 100% Acquisition Costs 240
New Fields
© Lloyd’s
PMDR Template – Amended Fields
Field Names Field Number
Single Risk Flag 10
Expiring UMR 20
Expiring Syndicate Risk ID 30
Current UMR 40
Current Syndicate Risk ID 50
Syndicate Class of Business Code 60
Risk Code 70
Inception Date 80
Expiry Date 90
Risk Exposure Location Code 100
Domicile of the Insured 105
Lloyd's Slip Leader Flag 110
Distribution Channel Code 120
Coverholder PIN 125
Method of Placement Code 130
Service Company Indicator 135
Original Currency Code 140
Expiring Syndicate Gross Written Premium 150
Current Syndicate Gross Written Premium 160
Current Syndicate Acquisition Costs 160a
Expiring 100% Gross Written Premium 170
Expiring 100% Acquisition Costs 170a
Change in Expiring 100% Gross Written Premium Due to Change in Deductible /
Attachment Point 180
Change in Expiring 100% Gross Written Premium Due to Change in Breadth of Cover 190
Change in Expiring 100% Gross Written Premium Due to Other Factors 200
Change in Expiring 100% Gross Written Premium Due to Pure Rate Change 210
Current 100% Gross Written Premium 220
Current 100% Acquisitions Costs 220a
Current 100% Benchmark Price 230
Expiring Renewed 100% Acquisition Costs 240
Amended Field Definition
© Lloyd’s
100
Expiring
100% GWP
170
100,000 40,000
180
Change in Expiring 100%
GWP Due to Change in
Limit / Attachment Point
20,000
190
Change in Expiring
100% GWP Due to
Change in Breadth of
Cover
20,000
200
Change in Expiring
100% GWP Due to
Other Factors
-60,000
210
Change in Expiring
100% GWP Due to
Pure Rate Change
Current
100% GWP
220
120,000
+ 40
+ 20 - 60
120
+ 20
Gro
ss W
ritten P
rem
ium
£k
Insurance Policy Details
Last Year This Year
Insured 1 hotel 1 hotel with swimming pool
Policy Limit £5,000,000 £15,000,000
Perils Fire, Flood Fire, Flood and Earthquake
Premium £100,000 £120,000
RARC% = -60 / (120 – (-60)) = -33%
PMDR Template: RARC Insured’s view
© Lloyd’s
50
Expiring 100%
GNP
170 + 170a + 240
50,000 40,000
180
Change in Expiring 100%
GWP Due to Change in
Limit / Attachment Point
20,000
190
Change in Expiring
100% GWP Due to
Change in Breadth of
Cover
20,000
200
Change in Expiring
100% GWP Due to
Other Factors
-54,000
210
Change in Expiring
100% GWP Due to
Pure Rate Change
Current
100% GWP
220 + 220a
72,000
+ 40
+ 20 - 58
72
+ 20
Pre
miu
m £
k
PMDR Template: RARC Insurer's view
Insurance Policy Details
Last Year This Year
Insured 1 hotel 1 hotel with swimming pool
Policy Limit £5,000,000 £15,000,000
Perils Fire, Flood Fire, Flood and Earthquake
Premium paid by Insured £100,000 £120,000
Brokerage £30,000 £48,000
Premium Received by the Insurer £70,000 £72,000
RARC% = -58 / (72 – (-58)) = -45%
NB: Field 240 (-£20,000) is not shown on the graph
© Lloyd’s
• Available to agents for first
time in April 2015
• Used in key business
processes within Lloyd’s
• Summarises information
from numerous Lloyd’s
reports
• Latest available information
• Updated (at least) quarterly
• Available via SecureStore
Syndicate Key Performance Indicators
Agent SOAP Report
© Lloyd’s
Business Intelligence Team
PMDR Playback
Published: Monthly
Monthly snapshot of
business as it is written
Lloyd’s Statistics
Published: Annually
Key facts and figures relating
to the Lloyd’s market
Performance Information
Published: Quarterly
Benchmarking of syndicates’
performance over last 5 years
Cross-cycle Performance
Published: Annually
Annual analysis of long term
insurance cycle trends
Other Reports for Managing Agents
Lloyd’s Asia Platform
Published: Quarterly
Quarterly analysis of business
written through Singapore
© Lloyd’s
Business Intelligence Team
Visit us at Table 2
Ask Questions
Discuss Reports
Give Feedback
Paul Speller Colin Campbell
Thomas Halfpenny Lincoln Meade
Anthony Balfe
PMD Return Information: [email protected]
General Queries: [email protected]
© Lloyd’s
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Claims Reporting Suite Andrew Johnson, Claims MI Analyst
Lloyd’s Claims Team
October 2015
© Lloyd’s
Claims Reporting Suite
What is it?
► Single Version of the Truth
► Available to all Managing Agents and
Lloyd’s Staff
► Web Based
► Updated Daily
► Approx. 10 Claims Key Performance
Indicators
► Single Version of the Truth
© Lloyd’s
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What does it show?
KPIs that the market wanted
Closed Claim Metrics
► Reserve Accuracy
► File Management
– Lifecycles
– Re-openings
► Recoveries
► Expert Management
– Lawyers
– Third Party Adjusters
Open Claim Metrics
► Nil Reserves (TBAs)
► Statics
► Catastrophe Claims
Operational Metrics
► ECF (Electronic Claims Files)
– Transaction Times
– Response Times
– Query Rates
– Incomplete Transactions
© Lloyd’s
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What does it look like?
KPIs that the market wanted
© Lloyd’s
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What does it Look Like?
© Lloyd’s
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What does it look like?
© Lloyd’s
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Monthly/ Quarterly Summary Report (e-mailed pdf)
► Overview Page
► ECF
► Statics
► Nil Reserves
► Claims Portfolio View
© Lloyd’s 33
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© Lloyd’s 33
Lloyd’s Delegated Authorities- MI October 2015
Adam Davis- DA Executive
© Lloyd’s 34 © Lloyd’s 34
Introduction to DA Data
1) Delegated Authorities market report
2) Secure Store
3) Future Projects
© Lloyd’s 35
Managing Agent report- Atlas
76%
24%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
In-Force Expired
PI
In-Force
Expired
85%
15%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
In-Force Expired
Financials
In-Force
Expired
72%
88%
28%
12%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Market Average Market Average
2014 2015 Q1-Q2
Annual Compliance
In-Force
Expired
63% 70%
37% 30%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Market Average Market Average
2014 2015 Q1-Q2
E-Module
Completed
Not Completed
© Lloyd’s 36
Managing Agent report- BARs
91.27% 88%
9.817% 12%
0.00%
10.00%
20.00%
30.00%
40.00%
50.00%
60.00%
70.00%
80.00%
90.00%
100.00%
Market Average Market Average
2014 2015 Q1-Q2
Post-inception
Prior to inception
Post Inception
81%
92%
19%
8%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Market Average Market Average
2014 2015 Q1-Q2
Not registered
Match
No Match
© Lloyd’s 37
3) Secure store:
► What is it?
– Online Information/document exchange between Lloyd’s,
Managing Agents and Brokers
► What are the benefits?
– information availability
– Reduction in enquiries
– Reduction in time
– Automatic notifications of any changes to your unique page
© Lloyd’s 38
Secure store:
► What information will be available?
– Audit information
– Coverholder Applications
– LMA Wordings
– Market Bulletins
– Minimum Standards
– Open Market Correspondence
– Procedure Documents
– Reporting Standards
– User Guides and Code of Practice
► More information and a user guide is available on Lloyd’s.com
© Lloyd’s 39 © Lloyd’s 39
Coverholder loss ratio project
► Using premium and claims data from
Xchanging and LDR.
► Key Countries for focus
► Broker and Coverholder
strategic partnerships
© Lloyd’s 40 © Lloyd’s 40
Atlas XML extract
► Allows 150+ market participants to extract data
from Atlas and BAR.
► Loaded into Binder and Coverholder
management Systems
© Lloyd’s 41 © Lloyd’s 41
Coverholder audit analysis
► Provide MI based on recommendations
► Identify areas of concern
► Training needs in the CH population
© Lloyd’s 42 © Lloyd’s 42
Delegated Authorities team
► Visit us at Table 3
Adam Davis Charlie Craven
Barney Smith
Ask Questions
Discuss Reports
Give Feedback
General Queries: [email protected]
Data requests: [email protected]
© Lloyd’s 43
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© Lloyd’s 43
Exposure Management Danial Khan
14 October 2015
© Lloyd’s 44
► Casualty Analytics Platform (Arium)
– What it is?
– Updates
► Oasis Loss Modelling Framework
– What it is and how will it help?
– CatRisk
► Data Collection Exercises
© Lloyd’s 45
Arium - Casualty Analytics Platform
► A tool that enables the user to better understand, explore and
stress their liability exposures.
© Lloyd’s 46
Arium - Casualty Analytics Platform
► The platform overlays a user’s portfolio onto underlying industry
and economic data allowing:
– Highly interconnected clusters of exposure to be identified
– Liability scenarios to be developed and applied, and
aggregates calculated
– Losses from scenarios to be allocated out to policies
© Lloyd’s 47
Arium - Casualty Analytics Platform
© Lloyd’s 48
Oasis Loss Modelling Framework
► The Oasis framework aims to:
– Encourage transparency in model building
– Increase supply of catastrophe models
– Stimulate innovation
– Creating a viable environment for the commercialisation of
tools and models
© Lloyd’s 49
Oasis Loss Modelling Framework
► CatRisk Middle Eastern Earthquake Model
© Lloyd’s 50
Oasis Loss Modelling Framework
© Lloyd’s 51 © Lloyd’s 51
Data Collection Exercises
► OSFI Data Form
► Catastrophe Sensitivity Tests
► South Africa/China Aggregates
► LCM/LCR AoC & RoW EP Data
► Cyber Risk & Marine RDS
© Lloyd’s 52
Exposure Management LCM Team
► Meet us at table 5
► Ask any questions
► Give feedback
► Contact us at: [email protected]
Sundeep Chahal Mark Pickett
Andrew Mitchell Danial Khan
© Lloyd’s 53
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© Lloyd’s 53
Lloyd’s International Trading Advice (LITA) Lloyd’s Data & Intelligence Day
14 October 2015
© Lloyd’s
50 50
Lloyd’s licensing and trading rights
Over 80 countries
Licensed or eligible to undertake insurance business
US ‘surplus lines’ approval
Registered or licensed to write reinsurance business
© Lloyd’s 55
Compliance: A collective responsibility
But we’re here to help:
• Monitoring international regulation
• Communicating regulatory and tax requirements
• Providing the LITA enquiry service
• Providing online tools
© Lloyd’s 56
Risk Locator Tool Crystal
Helps in….
…..identifying legal location of
risk
Quick and easy access to
international regulatory and
taxation requirements
© Lloyd’s 57
Regulatory news updates
Newsletter articles What’s new reports
Requires registration
© Lloyd’s 59
LITA on Lloyds.com
Harrison Costi
Apprentice
LITA on Lloyds.com:
The Market Directories Corporation contacts Lloyd’s International Trading Advice (LITA)
Online regulatory tools:
The Market Tools & Resources Tools (E-Services) Crystal
General guidance on risk location:
The Market Tools & Resources Tools (E-Services) Establishing Risk Location
Key contacts:
Giles Taylor
Senior Manager
T. +44 (0)20 7327 6462
DATA & INTELLIGENCE DAY
TABLE 7
PLEASE COME SEE US!
LMA
Triangulations
Neil Roberts
Lloyd’s Market Association
Loss Ratio Triangulations
Market data processed via the Bureau is aggregated by Xchanging (split by risk code)
LMA manipulate the data to be useable by Managing Agents
Signed premium, paid and incurred claims (gross of reinsurance)
Data converted to GBP but also available in 13 other currencies
Updated quarterly
Over 20 years of data
Risk codes written by 4 or fewer Syndicates not shown
Triangulations – Raw Data
Triangulations Display
Functionality Improved
User Issues
Triangulations used by IUMI
Caveats
Inaccuracies in 13% of codes (including Motor)
6.3% missing premium (by value)
8.5% missing claims (by value)
Completeness of premium and claims data not currently achievable
Triangulations – Changes
Password access through
www.lmalloyds.com
To obtain a password, please contact:
Main Triangulations contact:
Triangulations Access
Verisk Analytics, Inc. All rights reserved. Confidential and Proprietary
During the next few minutes...
70
• What is ISO?
• What does ISO do?
• What ISO services Lloyd’s syndicates have access to?
Insurance Services Office
© 2015 Insurance Services Office, Inc. All rights reserved. Confidential and Proprietary.
Verisk Analytics, Inc. All rights reserved. Confidential and Proprietary 71
Broadly speaking ISO provides…
• Statistical, actuarial, underwriting and claims
information
• Policy language
• Information on specific properties and their
surrounding environment
• Fraud-identification tools
• Technical services
For almost 45 years ISO has, and continues to provide, a key and central
role within the insurance industry – ISO helps risk bearing
businesses better understand and manage risk.
ISO Services for the Lloyd’s Market
© 2015 Insurance Services Office, Inc. All rights reserved. Confidential and Proprietary.
Verisk Analytics, Inc. All rights reserved. Confidential and Proprietary 72
Wordings (ISO Policy Form Language)
• ISO Forms provide insurers with coverage terms that
have been tried and tested over many decades
• ISO Forms are continually refined to ensure they
meet the needs of the consumer and insurance
industry
• ISO Forms are used by ~95% of insurers writing US
domiciled risk.
ISO Services for the Lloyd’s Market
© 2015 Insurance Services Office, Inc. All rights reserved. Confidential and Proprietary.
Verisk Analytics, Inc. All rights reserved. Confidential and Proprietary 73
PCS (Property Claim Services)
• Since the 1940’S US insurers have provided PCS with
claims information related to catastrophic events
• The data collected is aggregated and a final
expected loss amount is issued
• ISO’s PCS numbers are used to determine the
potential cost of catastrophic events
• The final loss is also used as a trigger for Index Linked
Securities (ILS / CAT Bonds)
ISO Services for the Lloyd’s Market
© 2015 Insurance Services Office, Inc. All rights reserved. Confidential and Proprietary.
Verisk Analytics, Inc. All rights reserved. Confidential and Proprietary 74
ISO’s Information about risk:
what does it mean to the insurance industry?
ISO has the largest data base of
information about risk in the world
Insurers use ISO data and information to
evaluate the risks they write and to help
determine the price they charge
ISO’s vast database of information about risk
enables underwriters to generate a “technical
price” for over 28 lines of business in the US
ISO Services for the Lloyd’s Market
© 2015 Insurance Services Office, Inc. All rights reserved. Confidential and Proprietary.
Verisk Analytics, Inc. All rights reserved. Confidential and Proprietary 75
Cyber – A topical subject!
• ISO provides a stand-alone cyber insurance program
(wordings and pricing) as well as several
cutting-edge tools to address cyber risk
• ISO collects cyber data and is
working with AIR to establish
data standards for modelling
and aggregation
• ISO works with Cyber Security
companies to help insurers and
their clients manage cyber risk
ISO Services for the Lloyd’s Market
Cyber Insurance
Record
Comp. Info
Ins. Coverage
Data Assets / Storage
Transfer
© 2015 Insurance Services Office, Inc. All rights reserved. Confidential and Proprietary.
Verisk Analytics, Inc. All rights reserved. Confidential and Proprietary 76
What is the LWR?
• Quality vetted content: actively managed
by the LMA
o Contains ~5,000 model wordings
generated by London market
practitioners
• Available to all Managing Agents via a
web based platform hosted by ISO
• Library of Market Wordings and clauses
o A wordings database owned by Lloyd’s
Lloyd’s Wording Repository (LWR)
© 2015 Insurance Services Office, Inc. All rights reserved. Confidential and Proprietary.
Verisk Analytics, Inc. All rights reserved. Confidential and Proprietary 77
Unlimited access to all Lloyd’s Managing Agents
Access to model wordings and clauses regularly
used within the London market
Supports Contract Certainty by providing a single
definitive version of every wording
B
E
N
E
F
I
T
S
Provides automatic email alerts when new or
amended wordings are available
An intuitive and user friendly tool that provides
simple and advanced search functionality
Lloyd’s Wording Repository (LWR)
© 2015 Insurance Services Office, Inc. All rights reserved. Confidential and Proprietary.
Verisk Analytics, Inc. All rights reserved. Confidential and Proprietary 78
Searchable Sections
• Lloyd’s Managing Agents are entitled
to store their own wordings on the LWR
• Managing Agent Dedicated Section
Lloyd’s Wording Repository (LWR)
© 2015 Insurance Services Office, Inc. All rights reserved. Confidential and Proprietary.
Verisk Analytics, Inc. All rights reserved. Confidential and Proprietary 79
Registration is by email invitation
How do you register for the LWR and ISO Services?
Want to learn more? Please visit table 8
Obtained by emailing: [email protected]
ISO Lloyd’s Portal web address: https://www3.iso.com/lloydsportal
LWR web address: www.lloydswordings.com
LWR content related enquiries: [email protected]
ISO Services for the Lloyd’s Market
© 2015 Insurance Services Office, Inc. All rights reserved. Confidential and Proprietary.
This material was used exclusively as an exhibit to an oral presentation. It may not be, nor should it be relied upon as reflecting, a complete record of the discussion.
© Lloyd’s 80
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© Lloyd’s 80
Market Intelligence at Lloyd’s Data Day - October 2015
© Lloyd’s 81
KEY Objectives
1. Support Managing Agents and Syndicates’ international development strategies
2. Conduct a wide range of research and analysis of the world’s key insurance
markets
3. Support Global Markets Thought Leadership role in the market
4. Local intelligence made widely accessible across the London market
5. Provide regional specialisation within the team
Market Intelligence at Lloyd’s
© Lloyd’s 82
Market Intelligence supporting your decisions
Business & Economic Environment
Source: IMF / IHS
What’s the GDP growth for the Malaysian economy in the last 5 years?
What is the forecasted growth outlook of the Latin American economies?
Insurance Market
Source: Local regulators data releases
What is the market share of Lloyd’s in the Canadian Aviation market?
Who are the top cedants for commercial property insurance in Brazil?
Lloyd’s
Source: Xchanging
What is the split of facultative versus treaty business, written in Australia?
How is your European Aviation book performing vs the rest of Lloyd’s?
© Lloyd’s 83
Market Intelligence – Reporting Suite
Compare Countries Structured Database with Economic, Insurance Lloyd’s statistics
Supports high-level analysis +200 territories
Country Profiles Factsheets with key insurance overview covering +50 territories
Market Presentations Reports containing local insights on key trends and main opportunities
and challenges for Lloyd's in those markets covering +30 territories
Class Review In-depth reports providing benchmarking insights for specialty class of
business covering +35 territories
Market Insight Reports In-depth research highlighting the size of the prize for Lloyd’s in target
markets
© Lloyd’s 84
Explore our website
www.lloyds.com/MarketIntelligence
Choose
your
country of
interest
Access
our
reporting
suite here
© Lloyd’s 85
Bruno Davila, Senior Manager – Market Insights Reports
Market Intelligence Team
Sandra Zukowska, Analyst – Europe, Middle East and Africa
Sophie Brown, Analyst – Americas and Asia
Lara Green, Executive – UK and Ireland
George Delis, Data Specialist – Compare Countries
© Lloyd’s
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Reserve benchmarking Varuna Porter, Market Reserving & Capital
14 October 2015
© Lloyd’s
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Purpose & background
► Held and best estimate basis
► Relative reserving benchmark
– Not a measure of absolute
reserve strength
– 5 measures (KPIs) and an overall
Reserve Benchmarking Index
(RBI)
– Agents compared to a
benchmark specific to their mix of
business
8
7
© Lloyd’s
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Example output – overall summary
8
8
tAble 3.1 – quartile ranking of index
Gross Net
RESERVE BENCHMARKING INDEX (RBI) 1. Reserve Strength
2. IBNR Utilisation
3. Reserving Over Time
4. Paid Loss Ratio
5. Speed of Development
© Lloyd’s
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Reserve strength
► Measure made up of 4 separate components
– Reserves as % ultimate
– IBNR as % ultimate
– Case reserve as % incurred
– Survival ratio
► Most important measure in terms of the benchmark calculation
8
9
© Lloyd’s
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IBNR utilisation
► Looks at how quickly IBNR held is being burned through over a one
year period
► Burn considered over 3 separate calendar years
9
0
© Lloyd’s
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Reserving over time
► Measures how good agent estimates of ultimate were for each year of
account
9
1
© Lloyd’s
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Paid loss ratio
► Proxy for ‘quality’ of business
► Better quality business needs lower reserve, all else being equal
► A strong score in this area will offset to some extent the first 3
measures
9
2
© Lloyd’s
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Speed of development
► Designed to give credit for faster developing business
9
3
© Lloyd’s
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Example output – high level detail
9
4
© Lloyd’s
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Additional information – OTHER metrics
► Other KPIs are shown for information only
► E.g. ultimate loss ratio, reinsurance, portfolio mix information,
acquisition cost analysis.
9
5
© Lloyd’s
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Additional information - SII technical provisions
96
Chart 9.2.1 – Analysis of change from UK GAAP basis to SOLVENCY II basis - £m
-
500
1,000
1,500
2,000
2,500
3,000
UK GAAP NetProvisions
Movement ofFuture
Premiums to TPs(1)
UK GAAP NetProvisions (Net
of balance sheetmovements)
Removal ofEarned Claims
Reserve Margin(2)
Removal of100% UPR
Requirement (3)
UK GAAP NetProvisions (Net
of Margins)
AdditionalExpenses (4)
Inclusion ofUnincepted
Contracts (5)
Total DiscountCredit (6)
Risk Margin Net TechnicalProvisions
Line reallocations Best Estimate Adjustment Solvency II Valuation Differences
Net Earned UK GAAP Provisions Net Unearned Provisions (net of DAC) Deferred Acquisition Costs Benchmark Movement
The above movements are derived as follows:
1 All net of reinsurance future premium relating to 2013 and prior years of account, net of acquisition costs. Note that this
may not reconcile to the movement of future premium debtors on the balance sheet.
2 Earned UK GAAP Provisions (OS+IBNR+ULAE) less future claims arising from claims provisions (plus ULAE). Note
that claims provisions include an allowance for binary events.
3 UK GAAP Unearned Provisions (UPR + URR) less claims arising from premium provisions (plus unearned ULAE) on
2013 and prior underwriting years. Note that premium provisions include an allowance for binary events.
4 Non-ULAE expenses arising from claims and premium provisions on 2013 and prior years of account.
5 Undiscounted net best estimate on 2014 year of account.
6 Discounting credit in net best estimate over all years of account.
© Lloyd’s
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Additional information – Reserve benchmarking packs
► Reserving contacts (normally the
Reserving Actuary) plus any
additional requests (often Chief
Actuary, Finance Director, CEO)
► Meetings with agents take place in
Q3
► Lloyd’s MRC contacts: Tracey
Moore, Varuna Porter.
9
7
© Lloyd’s 98
Lloyd’s Vision 2025 To be the global centre for specialist insurance and reinsurance
…but it is a dynamic vision
Strategy, Business Planning and Ratings & Investor Relations Lloyd’s Data & Intelligence Day October 2015
© Lloyd’s
Each year we analyse the global economic and market environment and refresh Lloyd’s strategy accordingly
99
Vision 2025:
To be the global centre for specialist
insurance and reinsurance
Franchise Goal:
To create and maintain a commercial
environment at Lloyd’s in which the
long term return to all capital providers
is maximised
Innovation:
Lloyd's will build on its
leading edge capability
and reputation for
innovation in the global
insurance industry
Global CSR :
Lloyd’s will remain a
responsible global
corporate citizen through
its ethical principles and
practices, and sharing of
knowledge and expertise
Brand:
Lloyd's brand will remain
admired and attractive to
customers and market
participants
Talent:
Lloyd’s market and
Corporation will continue
to attract and retain the
best talent through a high
performance culture, best
practices and inspirational
leadership
Capital :
Lloyd’s optimal capital
strength and
attractiveness will be
designed and
demonstrated
ease of doing
business:
Lloyd's will have a leading
industry service
proposition, built on
excellence in processes,
technology and data
Market Oversight:
Lloyd’s market oversight
will be supportive of
sustainable profitable
growth and will be valued
by all stakeholders
Global Market Access:
Lloyd's international
growth will be enabled by
offering optimal trading
rights and effective
operational infrastructure
© Lloyd’s
The update is outlined in the Lloyd’s strategy…
…And Progress against the strategy is reported in the annual report
In recent years the Strategy
has been published annually in
Q1
© Lloyd’s
The annual report also contains balance sheet and P&L as well as…
Financial highlights Lloyd’s capacity by source and location
© Lloyd’s
…Key performance indicators…
Lloyd’s chain of security Market performance
© Lloyd’s
…and Key risks
© Lloyd’s
There is also a shorter interim (half year) update…
© Lloyd’s
…full year and half year results presentations for investment analysts…
Audio and
slides are
published
on-line
© Lloyd’s
… As well as even shorter interim management statements for q1 and q3
© Lloyd’s
Q1 Q2 Q3 Q4
2015 publication timeline
Annual Report (Full
year)
Publication
Management
statement (Q1)
On-line
Management
statement (Q3)
On-line
Interim Report
(Half year)
Publication
Strategy Report
(Covers next 3 years)
Publication
FY presentation
Audio and slides
On-line
HY presentation
Audio and slides
On-line
Full results
publication High-level
on-line
Contact us
Strategy Team: Tom Allebone-Webb – [email protected]
Ratings & Investor Relations Team: Debbie Sallas –
Society rating
update
On-line
LM TOM – Data Integration
Helen Crooks, LM TOM DI Champion & Lloyd’s CDO
October 2015
TOM
‘London Matters’ highlighted the threat to London's position
The London Market is the largest global centre for commercial and specialty risk and is in a great position of strength
Ongoing investment in making
the market more accessible and
efficient
Continued strong brand with
financial strength ratings
reaffirmed, outlook revised to
positive
Continued focus on our
collective vision and goals
Increasing retention of risk in
high growth developing
markets
Higher acquisition costs make
London a more expensive
market to deal with than its
competitors
An inflexible business servicing
model that is inefficient and
slow to change, reducing
London’s competitiveness
These challenges are recognised by the market and there is acceptance of the need to change
However, the world is changing which is challenging London’s position
The LM TOM will enable an efficient and accessible market of choice
Design principle
One touch data capture
Enhanced central services
Current operating model
Inefficient and
paper based
Inflexible
Fragmented
Target operating model
Highly
effective and
accessible
Enhanced
data sets
Economies
of scale for
common
activities
Design principle
Data Integration underpins all initiatives
PPL • Electronic quote
• Electronic bind
CSRP PbS • EBOT input (technical account)
• ECOT input (claim settlement)
• Accounting structured data capture
• Automated accounts processing
• New query process
Claims • Central claims management
• Single agreement process
• Global claims system
• Customer & competitor analysis
• Claims structured data capture
Settlement • Faster settlement
• Global direct settlement
• Simultaneous settlement for
delegated authority
• Settlement in original currency
• Single London Market settlement
service
• ACORD settlement advices
Delegated
Authority • Faster coverholder approvals
• Central coverholder audits
• Simple binder registration
• Coverholder data publishing
• Coverholder data processing
• Risk, performance management,
claims structured data capture
Prioritised In flight Wave 2 Key:
TOM Service
Hub
• Data integration framework
• Messaging standards
• Data governance
• Master data management
Complaints • Complaints management
• Financial Ombudsman Service
reporting
• Simpler complaints process
• Faster resolution
Portals • Broker portal
• Carrier portal
• Client portal
• Third party portals (e.g. TPA/TPEs)
Local Hub • Premium handling
• Claims handling
• Document management
• Risk, performance management,
claims structured data capture
• Credit control
Data & Reporting • Enhanced tax & regulatory
information & reporting
• Central syndicate returns
• Enhanced Lloyd’s Direct Reporting
• Tax & regulatory structured data
capture
Data Integration provides a range of capability
What is the Data Integration
initiative?
The Data Integration initiative aims to bring together all aspects of the TOM
to ensure that data flows in a way which is controlled, seamless and joined
up across the London Market, supporting all TOM functions and services,
and the delivery of benefits across initiatives.
Data Integration Framework A framework which will support data integration across
the LM TOM.
► Definition of guiding principles and a data strategy
underpinning data use across the TOM
► Capture of requirements across initiatives and definition of
a design which supports data integration
► Promotion of capability for adoption by market participants
Messaging Standards Enhanced messaging standards (ACORD) supporting
the exchange of data by market participants.
► Definition of data exchange requirements across
initiatives
► Agreement of supporting ACORD messaging standards
► Promotion of capability for adoption by market participants
Data Governance Capability which allows control over captured and
exchanged data by validating data against defined
standards.
► Definition and establishment of a DG capability including
principles, policies, standards, processes and a
supporting market structure
► Identification and implementation of supporting technology
including data quality and reporting tools
► Promotion of capability for adoption by market participants
Master Data Management Capability which helps identify the single point of
reference for data items.
► Identification of data items to be managed and definition
of an approach to mastering these under MDM
► Definition and establishment of management processes
and supporting market structures
► Identification and implementation of MDM tools
► Promotion of capability for adoption by market participants
Come and visit us…
Table 1
Helen Crooks, LM TOM Data Integration Champion & Lloyd’s CDO
Neil Williams, LM TOM Business Architect
Peter Savage, LM TOM Technical Architect
Steve Pallett, LM TOM Senior Stakeholder Manager
Brian Austin, LMG SME
© Lloyd’s 2012
www.Lloyds.com/data
