a warm welcome to the september market breakfast group

Control Framework

A warm Welcome to

the September market Breakfast

Group

Control Framework

Breakfast Group agenda9:00 Arrival, breakfast & networking All 9:20 Welcome Ali Dove 9:25 Lloyd’s Delegated Authorities Lindsey Davies

• Audit scope changes• Audit coordination pilot• Atlas

9:40 Phase II progress & Responsibilities Jaana Rouvari of lead vs. follow

9:55 Broker conference update John Hibbert

10:05 Integro – A broker’s view into the Dan LottControl Framework

10:20 Q & A All 10:30 Close Ali Dove

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Lindsey DaviesLloyd’s delegated authorities

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Control Framework

• Audit scope changes

• Audit coordination pilot

• Atlas

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Progress on Phase 2

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Control Framework

August 2013

September 2013

October 2013

November 2013

December 2013

Initial meetings with managing agents

Managing agent has project resources in place

Coverholder risk rating exercise

Risk ratings reflected in audit schedules

Confirm delivery timeline to Lloyd’s

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Lead vs. follow

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Control Framework

You said…

The lead should…• Include Control Framework audit questions in the audit scope• Carry out the audit and share findings with follow• Coordinate communications with broker and coverholder

Where you follow…• You have limited power to influence• Rely on the broker to provide you with information (distribution

of bordereau, audit reports, etc)• Controls available are limited, confidence in your lead is key

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Lloyd’s listened

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Control Framework

The lead managing agent takes the responsibility for the Control Framework

This includes:• Risk rating exercise• Performing a gap analysis • Assessing sufficiency of controls • Remediation• Organising coverholder audits• Communications with the broker or coverholder

What about conflict of interest between the lead and the follow? 

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Broker conference17th September 2013

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Control Framework

53 Broking organisations registered out of 115 individual firms who operate in the binder space.

That represented 87% of the £4.2 billion GWP on a calendar year basis for 2012

Actual attendees on the day represented 70% of the 2012 GWP and they were joined by LIIBA

31 out of the top 40 BROKERS by GWP

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What was the feedback from the day

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Control Framework

What if two MAs risk rate a C/H differently? Red vs Green

Have the specific CFII audit questions been issued?

Relative to LLOYD’S 2025 vision. How fluid and/or flexible is the framework ?

Very appreciative of the early engagement by LLOYD’S

Will there be a reach out to all brokers?

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Integro – Dan LottBrokers’ view into the Control

Framework

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Lloyd’s Control Framework

The Control Framework is a positive step in the right direction for Brokers and for Coverholders…

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What is our role?

It is the Managing Agent’s responsibility to comply with the Control Framework but, as Lloyd’s Brokers, we have an important role to play:

Communication

Co-ordination

Pace-making

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What do we need to do?

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Understand the Control Framework - Phase II FAQs; Website

Be prepared: Are you a Coverholder?

Do the right people in your organisation know about the CF?!

As a Lloyd’s Broker, what (if any) processes do you undertake?

e.g. validating data / supplementing data / holding data

Expectation management is key! How will you introduce this to your Coverholders?

Audits are likely to be carried out on many Coverholders Start the dialogue early. Remember – this is nothing new!

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Who can we talk to?

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In the first instance, talk with your Managing Agent(s)

Mark Knight at LIIBA

The Project Team at Lloyd’s

It’s good to talk!

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Q & A

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Control Framework

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Control Framework

Close

Further information on Control Framework – jaana.rouvari@lloyds.com

Control Framework Phase I end of project celebration – Thursday 26th September

Next Breakfast Meeting – Tuesday 22nd October 2013

www.lloyds.com/controlframework