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Faster Claims Payment for brokers

Faster Claims Payment (FCP) is a new funding and payment solution which provides fast and direct payment of a claim to a policyholder, delivering significant benefits for brokers, their customers, and the entire market. Brokers have a critical role to play in the FCP process, both in the early stages and when FCP becomes an embedded and valuable component of the joint venture.

FCP will improve the claims experience for policyholders by allowing Delegated Claims Administrators (DCAs) to make payments on request in local currencies, drawing on managing agent funds directly via the Vitesse payment platform, removing the need for loss funds and the associated cash calls, and paying claims in hours. The solution enhances the reputation of Lloyd’s and all market participants, allowing them to compete with local insurance providers in efficiency and speed.

During our pilot, FCP successfully delivered 5,512 payments totalling $18 million with more than 20 fully automated replenishment cycles.

FCP benefits for brokers

For brokers, there is a net gain in time and effort for using FCP, with the removal of effort to set up loss funds and participate in cash call processes and the reduced costs of wire transfers to DCAs. The entire market has real-time visibility and control over claims payments, and as the cost of the solution is covered by insurers there is no financial cost to brokers.

Process changes

You may have seen our recently published best practice guidance for MAs and DCAs on bordereaux and data management, claims management and accounting reconciliation. For FCP to be properly adopted, it is critical that there is effective management of client funds by ensuring clean and accurate data as well as transparency and regularity in accounting and reporting.

The critical role of a broker in the process includes identifying suitable binders at the time of placement and ensuring all parties are already onboard and aware of the benefits. Other important tasks may require some changes to existing processes, but Lloyd’s and LIIBA are working together to mitigate and reduce any inconvenience during this period until FCP seamlessly integrates into the joint venture. The changes for brokers, summarised below, are detailed in the FCP Broker Journey.

Main FCP changes for brokers

Binder registration and account creation

  • Work with MAs to select suitable binders for FCP:
    • Ensure all parties are onboard with the solution - contact the project team during onboarding with any queries; see which MAs have signed up on the LIMOSS website
    • Speak to MA during placement to determine if loss fund or FCP is preferred payment method
    • Lloyd's 'singleton' binders are the easiest to onboard onto FCP in the first instance, however subscription binders are also fully eligible
    • The policy order has been placed 100% in the Lloyd's market
    • Other selection guidance is shared with onboarding parties
  • Insert new clause in contract to allow data to be shared with Vitesse – see guidance on the LMA website
  • Flags binders on DCOM as FCP
  • Respond to Vitesse/MA queries if errors or missing fields identified in section information and signed lines splits in DCOM
  • Assist follow markets to understand the historical performance of the binder to plan their funding accounts accordingly

Share and agree the bordereaux with all parties

  • Upload the BDX to ECF noting ‘non-cash’, ‘FCP’ and the BDX month in Broker Narrative field

How we will help

MAs will be onboarding one or two binders to help identify internal steps to adapt resources, processes, and collaboration to enable them to onboard more binders when we reach full market-wide adoption later in the year. If during the ‘early adopter’ phase there is some additional manual effort required for some brokers, particularly with regard to flagging BDX as ‘non-cash’, Lloyd’s and LIIBA are already working with your service providers to automate this before full adoption.

Training and engagement

We are offering detailed training and support as we begin to onboard market participants, including brokers, and have a dedicated web page with an overview of the materials, details of drop-in sessions and how to book training sessions.

Lloyd’s, the joint venture and LIMOSS engagement partners will be standing up a single market engagement team and creating communities broadly based on vendor groupings, both of which will also assist during the period.

As with any process improvement, the short-term effort in implementing the guidance will deliver medium and long-term gains in efficiency, reduced costs, and ease of transacting delegated authority business at Lloyd’s.

Get in touch

For more information on FCP please email us: