’We’re confident we can resolve defects quickly and encourage the market to maintain momentum with their own testing schedules,’ says Lloyd’s chief executive

Lloyd’s of London’s ambitious plans for the digitalisation of the London market have suffered another blow today (21 June 2024) as the already delayed market cutover to phase one of its Blueprint Two plans has been delayed again.

The statement from the market did not provide a date as to when the transformation programme would be delivered.

Blueprint Two was launched five years ago with Lloyd’s describing it as an ambitious scheme that would change the way the London market operated.

However, the phase one move to the new Velonetic developed platform – a company partly owned by Lloyd’s and the International Underwriting Association (IUA) – which had already been delayed from July to October 2024, has now been pushed back into 2025.

In a statement, Lloyd’s explained: “Today, Lloyd’s and Velonetic have announced that the cutover to phase one digital services, scheduled for a target date of October 2024, will be postponed to ensure safety and ample market readiness. Both the Velonetic board and shareholders and the Council of Lloyd’s are supportive of this decision.”

Lloyd’s chief executive John Neal added: “As we progress with delivery of phase one, we’ve faced challenges which have impacted our timelines, particularly with testing.

”Market testing of the new platform is progressing but running eight weeks behind schedule, driven by onboarding and integration issues. We’re confident we can resolve defects quickly and encourage the market to maintain momentum with their own testing schedules.”

“Both Velonetic and Lloyd’s are committed to ensuring a secure cutover to Blueprint Two phase one digital services for all market participants and system vendors. In light of these setbacks, it is appropriate to postpone the cutover.”

A distant horizon

Neal also refused to put a date on when the phase one cutover would occur.

He explained: “We will only cutover to phase one digital services once it is safe to do so – with a robust cutover, rollback and contingency plan in place – and that we are satisfied a number of key activities have been completed or are near completion.

“Only then will we decide a new cutover date, informed by market feedback.”

Lloyd’s added that Velonetic and Lloyd’s, with input from the market associations, were working through a revised plan and testing schedule, setting out the key activities that would contribute to a safe and successful cutover. The new plan will be shared as it is developed.

When the delay was announced this morning, Lloyd’s Market Association (LMA) chief executive Sheila Cameron told Insurance Times: “The LMA welcomes the decision by Velonetic, supported by Lloyd’s Council, to postpone the cutover date for Blueprint Two, taken in light of the reality that delays in testing have meant that it is no longer safe to cutover in October.

“The LMA remains committed to achieving the following three outcomes before the Blueprint Two programme goes live – a solution that works, a market that is ready and a cutover that is safe. Only when these are all in place – and not before – will be the time to make the switch to the new system.”

Cameron added that there could be no let-up in the progress, despite the delays.

“Momentum must not be lost,” she continued.

“The LMA encourages the market to continue to push forward with execution of testing over the coming weeks and months, as and when the testing facilities become available from Velonetic.

“The London market is united in wanting this programme to reach a successful conclusion. While this is taking longer than planned, it is important to remember that implementing digital processing services with Velonetic is the first step in achieving our vision of a digitised marketplace.”

Key issues

News of this latest delay came a week after the IUA announced it was to form a new committee to monitor the progress of the phase one cut over.

It said the committee has been created to review progress on the adoption of new digital services and would review information about the readiness of the London company market – and its technology partner Velonetic – to make the switch.

The committee will also advise the IUA board, so that “it can be assured there is no reason to recommend not cutting over to the new services”.

IUA chief operating officer Louise Day said the key issue was the delivery of a successful cut over, rather than a need to meet deadlines.

“We are working with Velonetic to ensure that we are all comfortable that it will be a smooth changeover,” she explained.

“If we delay the change over by six months and it goes smoothly in five years’ time, no one will remember it was delayed. If the changeover goes badly no one will ever forget.”