Shirine Khoury-Haq blog: ready to run?
2019 is the year when several key solutions in the London Market Target Operating Model (LM TOM) move from ‘build’ to ‘run’ – a clear signal that we have delivered against our original promise to make it easier to do business with the London Market. Whether it is placing risks through the market electronically, digitalising documents so they can be ingested into broker and underwriter administration systems or gathering information from our coverholders, solutions are available and are being used. London Market businesses have every right to be proud of what they have built together.
So, as 2018 draws to a close, what should can you expect next in this changing environment?
The market was very clear from the outset that as solutions were delivered, it wanted to create a shared central service to reduce duplication and increase efficiency. The result is LIMOSS, headed by Patrick Molineux, a single permanent team to define and execute the market’s sourcing strategy, oversee the services, manage the service providers and liaise with carriers and brokers. LIMOSS’s objective is to build a team with the right skills to get the best from service providers and deliver a high-quality service to market participants for whom these services will be increasingly important.
Making costs more transparent
For the last several years, work under the umbrella of the LM TOM has been paid for from a single budget, but the solutions in ‘run’ mode (PPL, SDC, DA SATS) are moving towards a user pays model. This process will be done in incremental steps as the adoption of different solutions grows and so, short term, market participants may be paying for services whether they are not using them or not – surely the best incentive in the world to get on board!
LIMOSS will continue to communicate with managing agents and company market carriers on their charging model.
For the new and ongoing build work, the LM TOM will have a separate budget. The scale of work and costs still have to be finalised, but the 2019 budget is considerably lower than the agreed 2018 figure as many of the existing solutions move to run and the user pays model.
Building for the future
The LM TOM was originally planned for three phases; however, some elements of Phase 2 have already been delivered early and still within budget. So now we can propose a final phase to deliver straight-through processing. This will initially focus on:
- Claims – to provide a modern business process to reduce rekeying and create a transparent audit record visible to all involved stakeholders. It will also provide customers with a faster and more visible claims service – the proof-point of their product.
- Contract quality assurance – to ensure that placement data is of sufficient quality to be reused throughout the insurance lifecycle removing the need to fix or re-key it further downstream.
- Data cache – to store placement and claims data for reuse throughout the insurance lifecycle. It removes the need for multiple varied storage and retrieval mechanisms, reducing cost and delivering a faster service for customers.
Passing the baton
At the outset of this work we set some ambitious targets, and we knew that success was going to take a while. If this is a relay race, we are definitely passing the baton as we move from delivery to adoption of solutions.
Much of the effort now must come from the broking and underwriting companies who need to integrate the solutions we have delivered into their own organisations. When that happens, the benefits become very real. This means working with vendors and suppliers and broadening collaboration. Fortunately, collaboration is in our market’s DNA.
The hard work and willingness by so many people in the market to go the extra mile on adoption and integration will mean that everyone, and most importantly our customers, can reap the benefits.