Someone is seeing that change is due.

Lloyd’s launches claims change program

By Stuart Collins
Feb. 04, 2008

LONDON—Lloyd’s of London is to push ahead with plans to improve the market’s claims handling performance, following the completion of its strategic claims review.

The “claims change program” is to deliver on the recommendations of the review, the results of which will not be made public, a spokesman for Lloyd’s said. The Lloyd’s Market Association, the body that represents Lloyd’s managing agents, is to write to its members with detailed proposals, he added.

The market will seek to reduce the average time it takes for a claim to be settled at Lloyd’s by amending claims processes. The market will look to differentiate between complex and standard claims, and redesign processes for managing high value and complex claims.

“Amendments to the agreement process and shared claims services will lead to an enhanced customer experience, as claims service is increasingly tailored to match claims complexity, thereby reducing the average settlement time and focusing experienced market resource where their input will add the most value,” said David Gittings, chief executive officer at the LMA.

The claims change program will be driven by Lloyd’s Franchise Performance Directorate, which oversees the market’s underwriting and claims performance, and the Lloyd’s Market Association’s newly created claims group.

It sounds like the bean-counters are becoming more militant.

I think it's because it's an election year.  They do this every 4 years or so.

In 1992 my boss and I visited Loyds and several of the large insurance companys around the main building. I was awed by how much these young claims people under 30 knew about the US. But most of them had been in insurance since they were 16.

The system works like this: A large or small broker in the US such as Marsh, Aon or Alexander & Alexander sends a proposal to a London Broker with the manuscript policy language and then the placement broker takes it to the floor (s) of Lloyds. They broker takes the risk to the member who like this certain risk type {factory ,hotels, energy, mining, marine, liability etc) and the "leader" agrees to call the shots for the followers (underwriters). The broker makes the rounds and get the risk 100% suscribed. A premium is agreed and the American Broker writes the policy.

When a loss/claim occurs the American Broker sends it to the placement broker in London who has claims people who take it to the floor and present the claim to the claims people in the box. The persons que up and when they get to box, he/she presents the known facts to the leaders claim person who appoints the adjuster or the attorney depending on the facts. And then the American Adjuster gets the claim by fax.

When the detailed first report is sent back it is to: Interested Underwriters C/O the broker. The same claim person goes back to the leader with the very comprehensive report and make a verbal summary of the report and the adjusters/attorneys recommendations; sometimes with out ever reading the report or asking the broker for comments the claim decision is made, sometime the claim person will leave the file with the underwriters person in the box and it will read it back in his office.

I set in a 6 man box for a large marine syndicate for 2 hours and got a liability claim while I was in the box and heard one of my files being presented. Awesome......  One big rule.. Adjusters NEVER comment on COVERAGE. It sounds like the straight foward type routine claims will be fast tracked faster, and the American Brokers can write the checks, from a trust account that is always current with the reserves. Sub standard autos, dwellings and O L & T claims have always been slow to get the funds for claim payments and service bills. Many of the American Adjusters working these high incidence claims/losses have a trust account for payments under a $$ limit. It,s great business. I love it.

Ray, I too have been to the London brokerage houses, very interesting the way they do things and certainly different than here in the states. I was there, on their dime, to discuss aviation claims and losses. I worked aviation for three different underwriters and had bordareaux accounts set up with all three. On small hull losses, I could issue payment for repair, but on complex large losses, I had to request funds. I really miss working aviation claims, but also enjoy doing the commercial losses and residential that we are doing now. I guess I really miss owning a plane and flying whenever I wanted to. I have flown to 13 different states on aviation claims, as far as California. Times have changed though. I have gotten old enough now that I think about the good ol days of yesteryear.