Lloyd’s chief gives reprieve until year end for firms failing to reach electronic reform targets as Lloyd’s profit soars 33%
Lloyd’s companies which have missed electronic reform targets will not be named and shamed or face sanctions until the end of the year, Lloyd’s said this week.
The reprieve came as it emerged that the market had fallen short of the targets set for uptake of the accounting and settlement (A&S) repository, as predicted by Insurance Times (News, 19 September)
Lloyd’s said that the uptake for the third quarter of the year was approximately 40% – 20 points short of the 60% target.
Speaking on the day Lloyd’s released its results, Luke Savage, director of finance, risk management and operations, said: “We will put out tables at the end of the year. It is unlikely there will be sanctions before then.”
Lloyd’s chief executive Richard Ward had said he would publish electronic reform performance tables for all Lloyd’s companies, and begin sanctions against those which were under-performing at the end of September.
This week Ward revealed that Lloyd’s pre-tax profit had risen 33% in the first half. But he said: “Electronic reform is proceeding well, but I hesitate because progress should be better.”
Electronic claims file (ECF) use was on target, however.
Despite the market’s failure to hit target for A&S, there was optimism they would be met by the end of the year.
Ian Summers, chairman of the brokers’ accounting and settlement implementation committee of the LMBC, said the implementation of the accounting and settlement repository would accelerate.
“By the end of the year we will hit the key targets. Brokers are receiving the necessary training and systems are in place. Once you have the brokers connected, the others will follow.
“To date, the implementation of the electronic claims file system has been fantastic. The pace of electronic reform, especially in light of the failure of Kinnect, is staggering,” said Summers, who is also director of change strategy at Aon.
Underwriting warning as profits hit Â£1.8bn
Lloydâ€™s chief executive Richard Ward warned the market to maintain disciplined underwriting as he unveiled its Â£1.8bn interim pre-tax profit.
Pre-tax profit increased by 33% in the first half of the year, from Â£1.35bn in 2006.
Ward said: â€œThese profits reflect the recent favourable rating environment and a relatively low level of catastrophe claims. We are now seeing a downward pressure on rates and a softening of conditions across all classes. This reinforces the continued need to focus on underwriting for profit.â€
Gross written premiums (GWP) were down slightly from Â£9,996m to Â£9,864m, while the combined ratio improved to 82.9% from 86%.