Documentation & Contract Checking Market Reform Forum 25 April 2007 RT - welcome on behalf of Lloyd’s & LMA

LMBC – Mike Reidie, Nigel Roberts Panel members: LMA – Martin Roberts Lloyd’s –Kieran Flynn LMBC – Mike Reidie, Nigel Roberts RT - Helpful if you could make a note of questions for later - Pl then give your name/firm/question…thank you

Documentation & Contract Checking Increasing certainty, quality and speed Market Reform Slip Contract Certainty Contract Checking Martin Roberts

Changes to Documentation & Checking Have been developing for some months: Background – Richard Ward’s letter 22 May 2006 and subsequent publications Main Features: All risk checking pre-bind: no stage 2 checking (limited volumes/ too late in process) A Copy slip may be used as the sole contract document Key dates: February 2007 no automatic addition to UPR End June 2007 stage 2 checking ceases/Slip policy schemes withdrawn Martin Roberts

Changes to Documentation & Checking Documentation options/new XIS service No further documentation required: Include Attestation Clause LMA3036A or Lloyd’s Policy required Include Attestation Clause e.g LMA3037A XIS Policy Signing Service – limited policy review, not full check (proof read process) Martin Roberts

Contract Checking All contract checking will need to be ‘Pre-Bind’ (‘Pre-Bind Quality Assurance’- PBQA): Underwriter/Broker responsibilities for quality Scope of checks for PBQA: CC, Tax & Regulatory and Lloyd’s Advisory/Risk Management Martin Roberts

Documentation Ensuring clarity and certainty for all parties Underwriter Documentation: Lloyd’s policy Complete copy of slip Certificates Broker Documentation: BID Martin Roberts

Pre-Bind Quality Assurance (PBQA) Focus now on: Reducing Legacy UPR listing and Ensuring Pre-Bind Quality Assurance Engagement with the market has included: Fact find on current ‘PBQA’ procedures within Lloyd’s Working Group shaped market approach to PBQA & endorsement by UCC of proposals to market Liaison with LMA, LMBC & IUA to encourage consistency on ‘Documentation and Contract Checking’ issues Kieran Flynn

Pre-Bind Quality Assurance (PBQA) PBQA addresses CC, Tax & Regulatory and Lloyd’s Advisory/ Risk Management checks Responsibility of MAs from 1 July 2007: Recognition of declining volume of Lloyd’s Policy requests and Cessation of Stage 2 checks by XIS Lloyd’s Market Bulletin will underline risk-based approach expected: Each MA has own PBQA procedures, reflecting individual risk KMF -Lloyd’s Market Bulletin will underline the risk-based approach expected: Each MA will have assessed their own risk and set appropriate PBQA procedures Options to manage PBQA-risk include: reliance on experienced u/w personnel, use of QA Tool checks, use of information in Lloyds.com earlier receipt of slips from brokers, use of wordings technicians, use of service providers, use of model wordings, use of s/ware to automate checks

Pre-Bind Quality Assurance (PBQA) Lloyd’s seeking practical approaches to assist the market: Clear risk-based approach set out for all, within U/W Standards Broking community engaged (assisted by Nigel Roberts & LMBC) Access to model wordings (in cooperation with LMA) Evaluation of automated checking with Adsensa (to support experienced underwriting & wordings personnel) Creation of coordinated information resource within Lloyds.com Crystal – Tax & Regulatory information, complementing QA Tool Enhancing QA Tool checks/ process (will take time) KMF - Apart from setting a clear approach to PBQA generally, Lloyd’s is seeking practical ways to assist - Recognise the importance of engaging with brokers – early discussions with LMBC, LMA & IUA show a willingness to work together – Broker Forum on 16 April was successful…we are all in this together - Run through each development above - Reinforce that Lloyd’s is here to assist the market now and beyond the 1 July 2007 date

Working together – What’s in it for brokers? Enhanced service for brokers’ clients once implemented Certainty in document content/format Faster final contract to client Reduction in post placement administration Easier to achieve 30 day target for contract issuance Mike Reidie - Hopefully able to reinforce the message that once fully implemented, the new procedures will be beneficial to all

Any Questions? RT Panel in place at front please Name/ Firm/ Question – to whom is it addressed?