Background
Proportional treaty reinsurance (prop treaty) is an important part of the London market, enabling managing agents and company market carriers to reinsure classes of business and manage their risk appetite.
Currently, several existing heritage applications support the processing of prop treaty risks, such as the Insurers Market Repository (IMR), LIDS, PoSH, and CLASS. Brokers submit For Declaration Only statements (FDOs), prop treaty statements, and upload supporting documents to the IMR. Submissions can also be sent via Document Repository Interoperability (DRI). Both brokers and carriers can view submissions and associated documents and updates within the IMR.
Previous cancelled prop treaty project
Prior to 2021, plans were in progress to create a new prop treaty application that could use Electronic Back Office Transaction (EBOT) submissions and a portal to allow online agreement of treaty statements. This was started as project under the London Market Target Operating Model programme (LM TOM) within the Central Services Refresh Programme (CSRP) project workstream. This project was cancelled, given the introduction of Blueprint Two and the future aim to bring all market messaging to EBOT and Electronic Claims Office Transaction (ECOT) standards.
The partially developed prop treaty application was simplified and stripped back so it could become part of the core build of the new Digital Processing Services (DPS), where it will be tested alongside other products.
Submissions and processing
The new application is supported by the DPS Document Repository Service (DRS), which will replace the IMR. All new prop treaty submissions will use this new service.
Brokers will submit FDOs, prop treaty statements, large losses (claims) and upload supporting documents to the DRS. Brokers will also be able to view submissions, associated documents and updates. Brokers can also continue to make submissions via DRI. Carriers will also be able to view submissions and associated documents within the DRS.
The new DPS prop treaty application will have a new internal processing engine and screens for Velonetic technicians to sign and settle transactions.
Managing prop treaty queries
All prop treaty queries will continue to be directed to the brokers, as they are best placed to manage these in relation to the submissions, statement and documents they have provided to Velonetic .
Accessing the DRS
The DRS will be available as part of the new digital processing services and accessed via a user portal in a similar way market participants access the IMR today. Accessing these services will be covered as part of the onboarding and training plans.
Details will follow as we approach go-live to ensure onboarding and training is delivered at the most appropriate time.
EDI messages
Prop treaty transactions utilise EDI messages through the premium and claims processes based on the statements submitted.
Brokers will continue to submit FDOs and receive supported EDI treaty signings, settlements, and claims messages. Carriers will also continue to receive notification messages for treaty signings, settlements, and claims transactions.
Get adoption ready
Blueprint Two will be delivered in two phases. At phase one cutover, all market firms must adopt the new digital services.