Risk placement
Submission and quote
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Broker builds out the risk contract details with the client
Broker commences the contract process by building out the Core Data Record (CDR) with fundamental risk data which could also be used to populate the Market Reform Contract (MRC) v3.
Broker inputs Core Data Record (CDR) data into their accredited platform.
The CDR data that the broker has input into their accredited platform could be used to create the MRC v3.
How we’re delivering the MRC v3
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Broker presents risk to the underwriters in the market
Brokers present the risk to underwriters using the Core Data Record (CDR), Market Reform Contract (MRC) v3 and supporting information.
During negotiations with underwriters, the MRC v3 and CDR will evolve in line with negotiations. This will occur automatically where the contract is built digitally.
At any point during the contract creation, the 'soft call' service can be used to validate CDR data. The ‘soft call’ is a service provided by the Digital Gateway, which brokers and underwriters can use pre-bind to validate they have the right data in the CDR.
An accredited platform will be used to share draft versions of the CDR and, if the platform allows, the MRC v3.
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Underwriter reviews the contract, negotiates the risk with the broker, and provides a quote
Underwriter reviews the contract, negotiates the risk with the broker, and where they are willing to provide capacity, provides a quote.
The lead underwriter agrees the Market Reform Contract (MRC) v3 and the subset of the Core Data Record (CDR) data required for downstream processing.
Broker discusses the risk with the underwriter using the Market Reform Contract (MRC) v3. Real time updates can be made in the contract and will be kept in sync with the Core Data Record (CDR).
How we’re delivering the MRC v3
Broker and underwriter can validate the CDR data using the 'soft call’ service in the Digital Gateway using Application Programming Interfaces (APIs) from an accredited platform. Any errors or feedback will be sent back to the accredited platform for correction of the digital contract and CDR data.
Risk placement
Firm order and bind (written lines)
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Underwriter conducts relevant compliance reviews of the contract pre-bind
Once the risk is agreed, the underwriter performs a compliance review of the contract to ensure it is complete with all the key information and clauses before binding the risk. This involves using various tools (e.g. Crystal) for Lloyd's lines that ensure compliance with Lloyd's licensing agreements.
Existing pre-bind checks will be required to be conducted on the contract, ensuring compliance with Lloyd’s practices. The ‘soft call’ will highlight any non-compliant Core Data Record (CDR) data or rules, while the compliance checks will identify a wider range of issues that cannot be automated.
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Broker confirms the quote is accepted by the client, and the underwriter confirms the offer and binds the risk
The lead underwriter agrees the Market Reform Contract (MRC) v3 and the subset of Core Data Record (CDR) data required for downstream processing.
Underwriter reviews and agrees any new or updated data submitted by the broker by putting their stamp down. The broker then approves the underwriter’s line and submits the Core Data Record (CDR) to the Digital Gateway.
Risk placement
Signing down and contract complete
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Broker signs down the placement for risks that are oversubscribed, to ensure it adds up to 100%
Broker signs down lines and submits the Core Data Record (CDR) via an accredited platform to the Digital Gateway.
Core Data Record (CDR) data is checked and enriched by the Digital Gateway, supporting the completion of the CDR. Any errors are sent back to the submitting accredited platform to be corrected and resubmitted. Once errors have been remediated, the CDR is complete.
Once the CDR is complete, it will be available for retrieval by the broker and underwriters.
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If required, broker and underwriter provide tax and accounting data to complete the Core Data Record (CDR)
For more complex risks, additional tax and accounting data may be required from the broker and underwriter to complete the CDR. This should be provided at contract complete, when signed line confirmation must have occurred and all accounting and tax CDR data should be submitted.
The broker and underwriter (if required) provide additional tax and accounting data to complete the Core Data Record (CDR) before making a hard submission to the Digital Gateway to indicate the contract is complete.
Premium processing and payment
Accounting and settlement
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Broker creates the accounting instructions
Broker creates the accounting instructions by sending an Electronic Back Office Transaction (EBOT) Technical Account (TA), which will replace the London Premium Advice Notes (LPANs). This will speed up premium payment, improve accuracy, and reduce manual effort and costs for the broker. These instructions will be at a fundamental level, split by insurer and currency.
Broker creates the accounting instructions by sending an Electronic Back Office Transaction (EBOT) Technical Account (TA) to the new Digital Processing Platform (IPOS). An EBOT TA will replace the London Premium Advice Notes (LPANs), improving premium payment speed, transparency, accuracy, and reducing manual effort and costs for the broker. These are delivered at a fundamental level, splitting by carrier and currency.
How we’re delivering the Digital Processing Platform
The EBOT is validated against the Core Data Record (CDR) to ensure that the accounting instructions match the risk record. Only EBOTs that match the CDR will be accepted.
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Broker provides relevant information for processing
The Technical Account (TA) created by the broker is automatically validated against the Core Data Record (CDR) which allows the Financial Account (FA) to be processed in the new Digital Processing Platform, allowing money movement to take place.
Underwriters will be advised of all Technical Accounts (TAs).
Broker can automatically create the Financial Account (FA), enabling money movement to take place with greater speed and transparency.
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Broker may receive queries for more information
Additional supporting information required to enable settlement will be provided and corrections made. This may be shown to the submitting platform at each step of the process.
Validation issues or queries are returned to the accredited platform, and any outstanding issues may require an update to the Market Reform Contract (MRC) v3 and Core Data Record (CDR). Errors will be highlighted by the Digital Gateway earlier in the process, which will significantly reduce errors.
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Once the premium is paid by the client, the broker triggers payment of the premium to underwriters
Brokers submits an Electronic Back Office Transaction (EBOT) Financial Account (FA) message when a client’s money is received.
An Electronic Back Office Transaction (EBOT) Financial Account (FA) message is sent to the Digital Processing Platform and the FA is matched against the EBOT Technical Account (TA).
How we’re delivering the Digital Processing Platform
Underwriter will receive premium payments faster, with greater certainty that it is accurate and aligned to the risk record.
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Underwriter receives a notification when the funds have been settled
All market participants are automatically notified when funds are settled.
The Digital Processing Platform automatically notifies all market participants when funds are settled utilising an Electronic Back Office Transaction (EBOT).
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The Corporation receives the relevant tax and regulatory data
The Corporation receives the relevant part of the Core Data Record (CDR) to facilitate tax and regulatory reporting. Syndicate reporting to regulators and tax authorities is a much smoother and more accurate process.
The Corporation receives the relevant parts of Core Data Record (CDR) to facilitate tax and regulatory reporting.
