There are still some key issues to discuss, many of which were raised in the conference. Some of them are:
- How can we ensure audit pricing remains competitive and a matter for agreement between the managing agent and auditor? Provided, that alongside the coordination aspect the cost negotiations rest privately with the auditors and managing agents this will work well. As with eBay (!) AiMS is a platform to enable this and in our view should not specify or share the pricing.
- Should Auditors post, publish and hold all of their reports on AiMS so that it becomes an integral work tool for Managing Agents teams to use, respond directly to and resolve queries on the site? Experience of the multiple copies, and occasionally versions of reports held around the market demonstrate that the reduction in workload through removal of duplication or triplication could be very beneficial indeed! However, there are often sensitive aspects of audits to be considered?
- How can Managing Agents different risk appetites be reflected in the individual recommendations made to Coverholders? A coverholder may have very different contracts and products with different Managing Agents. It is important that the AiMS tool allows the different appetites to be reflected in each leader’s recommendation follow up activity. Current plans to have one set of recommendations to a coverholder for all managing agents may in our view be a step too far?
- How can confidentiality be maintained across the reports produced? Obviously, the system security aspects have been locked down at market level. Concerns were raised over the confidentiality clauses currently in place between auditors and carriers across the market. This needs work to minimise potential conflict and the need for current audit contracts to be updated. This is not insurmountable but needs addressing.
- There may also be concerns raised by Coverholders who are usually very resistant to any sight or copies of an audit being given to Underwriters not party to their contract. Issues found on particular facility, say on a contract in the Company market and included in the report of of a coordinated visit. Clearly this could be resolved by redacting the data concerned but the Coverholder’s agreement would also need to be obtained.
In summary, we feel that AiMS is developing into an excellent platform to support the audit scheduling, scoping, booking and reporting processes. Our caution is that it is essential that it remain focussed on being a flexible tool for the market to use and must not become a restrictive straight-jacket.
Lloyd’s and market participants need to ensure that a balance is kept between developing a robust operational framework whilst at the same time providing enough flexibility for market participants to deliver to their individual risk appetite’s.
Lloyd’s business oversight should be driven by reporting rather than creating process constraints. Keeping an open platform will allow for future evolution and for ease of doing business rather than causing unnecessary encumbrance to both Coverholders and managing agents which surely is the driver for developing AiMS.
Do you agree?
Are there other important questions that you would like to hear answered?
How would you like AiMS developed in future?
We would really like to hear your comments so whether you are a Coverholder, Managing Agent, Broker or Auditor, please register with us and post your comments for a lively informed debate.
D A Strategy – “Insight to Achieve Your Delegated Authority Ambition.”
You may also like…
Manager, Kajal Pankhania, highlights the flexible support DA Strategy offers start-up MGAs looking to make an impact on the insurance industry with their MGA Design & Build services.
The principle of ‘fair value’ is here to stay and remains one of the foremost points of focus of the current FCA direction of travel for the insurance industry, says DA Strategy Associate Marcus Elwes.
DA Strategy Director Charles Rowley caught up with Mia Wallace at Insurance Business UK to talk through the evolving proposition of successful MGAs against the backdrop of the pandemic crisis, and a historic global insurance market turn.