When we delayed implementation of the new format slips until the third quarter, the recurring headline in the press was “London Market Principles (LMP2001) slip-up” .
But rather than view the delay as a setback, we saw it as an opportunity to listen to the market, learn from the process and get the new slip structure right. In fact, in my view, the practitioner-led problem-solving approach we have taken to this issue will be our new modus operandi.
Delaying implementation of the slips is not the first nor the last hurdle we will face as we move towards implementation. Indeed, issues relating to general underwriter agreements (GUAs) and some key systems prompted the launch of a number of cross-market groups similar to the one we are working with on slips.
Obstacles such as these provide us with an opportunity – to clarify, learn from and evaluate our goals and proposals. They allow us to gain feedback from the market and to ensure we are heading in the right direction.
LMP2001's ultimate goal of improving the service clients get from the London Market is still accepted and still valid. I believe passionately that LMP2001 is the right vehicle to achieve those goals. I'm often asked why I think we can succeed where others have failed and what is it that makes this programme different from previous initiatives to better the London Market?
I believe there are three major differences. First, a balance of executive leadership and practitioner experience has ensured we have developed practical proposals. From its inception, LMP2001 has invited and received input from all facets of the London Market. Both brokers and underwriters were asked for their perspectives in development of the reforms and, as we move toward implementation, we continue to invite feedback.
The steering group has a membership representing both executive and frontline interests and aids us in our commitment to reach the wider market audience. LMP2001 is, after all, a change programme for the market, by the market.
There is nothing new in LMP2001 – everything proposed is already practised somewhere in the London Market. LMP2001 is a framework of best practice on which we are asking the market to base their own business procedures.
We are saying: “Here are the principles, tailor them to suit your organisation's culture.” I often sense a fear from organisations that, in asking them to embrace LMP2001, we are asking them to go against sound commercial principles. Let me say now, we are not. Often, this concern is borne of misunderstanding, not of substance.
Dealing with the obstacles
Secondly, those involved in LMP2001 have shown considerable tenacity – and change relies on tenacity. Any attempt to embark upon the kind of long-term changes proposed in LMP2001, both in culture and process, will involve obstacles. But
I think it is not just the obstacles themselves we should focus on, but the way in which we deal with and respond to them.
Since its commencement, the project has seen changes in the management structure of both the International Underwriting Association (IUA) and Lloyd's, the establishment of Ins-sure Services and movement from a soft market, yet still LMP2001 has remained close to the top of the market's agenda.
Finally, the market recognises that now is the time for change. It is widely agreed there is a need for London to improve not only its performance, but also the perception of its performance. We must avoid becoming a “market of last resort” by clinging to outdated business practices which make poor service a given.
Now is the time to be a proactive market. LMP2001 is not about individual companies bettering themselves, but about the market bettering itself. If we can enhance the client's perception of London, then all of our businesses will benefit.
As individual companies, we can only get so far. We must remember that the service offered to a client from the subscription market is defined by the slowest participant on their slip. The imperative is to attract and retain quality business to London and to meet and eventually exceed client's expectations for value and service, That's the point of our business, isn't it?
Looking forward, work continues on the new format slip, taking on board the concerns of the market. Practical workshops and training sessions will follow to ensure brokers and underwriters can experience the new slips and the new approach; and launch of the bench marking initiative will drive improved performance.
This campaign to reform the London Market is a unique and ambitious project that was always going to require persistence. Even sceptics acknowledge that LMP2001 has pushed reform and modernisation to the top of the London agenda.
The process of reform has gained momentum – a momentum which I believe will prove unstoppable.
For further information on LMP2001, or a management briefing, contact the programme office on 020 7617 1903.