1. Electronic Claims Its coming There will be pain to get the gain Who is your business sponsor? If you handle claims, the way you do your job will change ECF Key Messages

2. Market Reform Electronic Claims Page 2 Overall Scope Deploys CLASS in the Lloyds market –acts as a simple workflow manager of claims transactions Delivers an interactive Insurers Market Repository to carriers (a shared electronic filing cabinet) –Interactive service available to brokers subject to XIS contract Adopts ACORD standards for the transfer of electronic documents –To/From brokers repositories (at no charge to brokers) –To/From carriers repositories

3. Market Reform Electronic Claims Page 3 LMA Project Scope Integrates CLASS and IMR –a single electronic claims service for Lloyds managing agents –support Lloyds Claims Schemes Does NOT change CLASS for brokers – Multiple interactive services: one for each market – LIMCLM: operational for IUA –defined and trialled for Lloyds

4. Market Reform Electronic Claims Page 4 IUA Project Scope 3 month pilot of Insurers Market Repository –To identify any additional IUA requirements –Expected start during Q2 2006 Does NOT –change IUA CLASS ( Operational since 1987) –change CLASS for brokers Lots to do since Lloyds managing agents will be live with an electronic claims service from late Q3 2006

5. Market Reform Electronic Claims Page 5 LMA ECF Objective To replicate todays file electronically –Not a Blue Sky Claims System development Based on existing products –Changes to CLASS out of scope (except look and feel) –Work with underlying software capabilities Provide a base product on day 1 –To be evolved once experience gained Post implementation of base product –Strategic review of on-going development –e.g. Third Party Access

6. Market Reform Electronic Claims Page 6 Status today Key Enhancements in 5 Phases Phase 1 - See all documents in one view Phase 2 - Leader control of file/improved searching Phase 3 - ACORD DRI (receipt of documents) Completed 2005 Phases 4/5 – Merged into a single phase CLASS @ Lloyds data through GUI, full DRI and Seamless link with documents in repository MAT starts 15 May 2006 (35 working days to go!) Live – mid-September

7. Market Reform Electronic Claims Page 7

8. Market Reform Electronic Claims Page 8 Screen shot – Transaction Summary Screen Screens are currently under development and are subject to change

9. Market Reform Electronic Claims Page 9 Systems Processes & Procedures Systems Processes and Procedures –High-level guide –NOT a systems user manual or adjusting manual Workshops convened to review generic process and class of business variations –Confirmed generic process –Confirmed little variation by class of business –A key benefit was to identify operational issues To be extended to include IUA Review legal governance –Interchange Agreement –Initiated Legal Review of Electronic Responses

10. Market Reform Electronic Claims Page 10 Systems Processes & Procedures (cont.) Identify the following operational Issues (Hotspots): –Big IssueResolved –BindersChange Request Raised –Bulks/BlocksAnalysis in Progress –Document RulesAnalysis in Progress –Delegation to XCSChange Request Raised –M.A. WorkflowChange Request Raised –Partial MarketsChange Request Raised –Non Broker TriggersAnalysis in Progress

11. Market Reform Electronic Claims Page 11 Features Broker submits claim electronically –Enables parallel presentation to insurers –Reduces data transcription errors –Allow brokers to concentrate on complex claims Improved insurer access to information –Its the insurers file –Concurrent access to all subscribing insurers –24/7 access, worldwide

12. Market Reform Electronic Claims Page 12 Next Steps Phase 5 delivery to MAT mid-May 2006 Delivers first version –of an integrated electronic claims service for Lloyds –replicating existing file electronically –with improvements where possible –companies and syndicates can see the same claim Things change and we wont have thought of everything There will be more issues and enhancements –Legacy claims –Issues and suggestions recorded

13. Market Reform Electronic Claims Page 13 Monthly Timeline

14. Market Reform Electronic Claims Page 14 Time and Budget Summary On track for software delivery to process electronic claims across the Lloyds market Within budget Early implementation partnerships growing Substantial market testing and implementation tasks this year Will change working practices from paper to electronic for many claims practitioners Will not deliver everything on day one - need on-going maintenance and review of Change Request log

15. Market Reform Electronic Claims Page 15 Implementation Broker-driven –with Lloyds and IUA carriers and XCS –by classes of business and risks –MRPO monitoring progress New claims and their subsequent transactions –Existing paper based claims (legacy) to be tackled later Early Implementations –Using todays CLASS and repository in parallel with the enhancements –Gives early experience of electronic work and assess impact on procedures and processes

16. Market Reform Electronic Claims Page 16 Early Implementers Valuable lessons continue to be learnt from early implementers 39 ECF partnerships created –6 brokers/17 managing agents, 2 companies – experience gathers pace Over 360 claims files Generating over 600 transactions electronically to date IUA Companies now actively participating in pilots – adding to the ground swell LMBC (via BEFIT) working closely with MRPO to ensure success of project

17. Market Reform Electronic Claims Page 17 Early Implementers Brokers Benfield Cooper Gay Guy Carpenter Marsh Millers Willis Aon (waiting for full DRI) Carriers Aegis Amlin Chaucer Faraday Hiscox Kiln Limit MAP St Paul Travelers Markel Brit Class of Business Marine Hull Aviation Direct Reinsurance PI Non Marine Property Binding Authorities FinPro Ace AIG Advent Atrium Welln Heritage Aspen Re XCS

18. Market Reform Electronic Claims Page 18 Carriers Wanting to Participate –Allianz –Global Aerospace –Munich Re –Swiss Re –Beazley –Liberty –SVB –XL Re –Zurich Brokers Wanting to Participate Arthur J Gallagher Glencairn

19. Market Reform Electronic Claims Page 19 Market Acceptance Testing (MAT) On schedule to start at 8am, Monday 15 May 2006 Two drops into MAT –Monday 15 May = Integrated IMR and Class@Lloyds functionality. –Monday 19 June = Full ACORD DRI functionality to latest published ACORD standards. Same timeframe as A&S (Repository) MAT –Aiming to test common features together –Avoid testing the same functionality twice

20. Market Reform Electronic Claims Page 20 Market Acceptance Testing - high level visual

21. Market Reform Electronic Claims Page 21 MAT participants Agreed participants:- –Managing Agents include; ACE, Advent, Amlin, Beazley, Danish Re, Faraday, Heritage, Hiscox, Limit, Markel, Marlborough, St Paul Travelers, SVB, Wellington and XCS –Brokers include; Aon, Benfield, Marsh, Millers, Willis (and possibly Glencairn) –Additional participants; XIS and MRPO (co-ordination)

22. Market Reform Electronic Claims Page 22 Public Commitment Brokers Committed to deliver new claims to Lloyds electronically Aon Benfield Marsh Active support from: Cooper Gay Guy Carpenter JLT Millers Willis Managing Agents Committed to deal electronically with new claims Amlin Brit Faraday Hiscox Limit Marlborough St Paul Travelers SVB Wellington MRPO seeking more through early implementers, testers and other communications.

23. Market Reform Electronic Claims Page 23 What should YOU do now? Assess and plan for the impact on you –Nominate two people: business sponsor; project manager –How many adjusters have you got? –How many will need access to the system? –Can you connect to these new services? –How will you ensure they are trained in CLASS and the repository?

24. Market Reform Electronic Claims Page 24 Future Operational electronic claims by end 2006 for brokers, Lloyds & IUA Roll out for processing new claims will continue into 2007 –Increasing pressure on any non participants This is just the Base Camp - foundation to: –Migrate to ACORD business messages for claims –Eliminate CLASS differences across the multiple systems –Enable third party access e.g. loss adjusters –Move existing claims from paper to electronic –Offer client tracking of claims

25. Market Reform Electronic Claims Page 25 Summary On track for software delivery to allow electronic claims in the Lloyds market using ACORD DRI Early implementation partnerships growing Substantial testing and implementation task this year Will change working practices from paper to electronic for many claims practitioners Named brokers and Lloyds managing agents publicly committed to electronic claims from Q4 2006 IUA coming on board

26. Market Reform Electronic Claims Page 26 Contacts Ben Sayles Project Manager 020 7327 6685 Ben.sayles@lloyds.com Mike Smith 020 7327 6642 Michael.J.Smith@lloyds.com Or…. Claims@lmpoffice.com

27. Market Reform Electronic Claims Page 27 ECF & Market Reform Andy Brookes Market Reform Programme Office

28. Market Reform Electronic Claims Page 28 ECF: Key part of the London process reform programme Overall aim: –A framework of standards for business processes that enables firms to deliver services efficiently to customers at a cost and level of risk comparable with other platforms Note: –Any costs inherent in a subscription market must be offset to deliver this comparability. –Any changes in business process must be managed in such a way as to avoid undermining the unique qualities/competitive advantages of the London Market.

29. Market Reform Electronic Claims Page 29 ECF is not happening in isolation Claims beyond ECF –Change requests – no system stays put –Claims infrastructure to include IUA –Protocols (LMP2001); Lloyds Claims Scheme –Support Claims Strategy & Minimum Standards Integration with other reform workstreams –Accounting & Settlement –Contract Certainty

30. Market Reform Electronic Claims Page 30 Integration with other workstreams Accounting and Settlement –Measurement checks; A&S repository; A&S strategy for P2P –Repository use –London market use of ACORD DRI Standards –P2P A&S: strategy questions for claims Contract Certainty –More certain contracts = fewer coverage disputes –Roles & responsibilities clearly defined –Repositories….again (e.g. model wordings)

31. Market Reform Electronic Claims Page 31 Implementation approach Lead implementers Prepare to follow: –Commercial –Lloyds performance standards –Regulatory better MI pressure Sponsors; project managers