Canadian Attorney In Fact (AIF) update
Recent developments in the introduction and implementation of the Canadian AIF Signing Process System (ASPS).
In December 2010, Lloyd’s issued Market Bulletin Y4456 advising that following discussions with the Canadian regulator, OSFI, it would be introducing ASPS.
ASPS applies to risks, insureds or cedants domiciled in Canada and is designed to ensure that open market and reinsurance business meets OSFI’s clarified interpretation of ‘insure in Canada a risk’. It is an electronic system, requiring Canadian open market and reinsurance contracts to be submitted to the AIF for Lloyd’s underwriters in Canada for signing.
The introduction of ASPS required significant engagement with the market and the development and delivery of a legally compliant process and supporting system fit for purpose in under a year. Key deliverables achieved within this timeline included:
- Process development in consultation with the market, external legal advisors and other interested stakeholders.
- Mandates granting the AIF the power to bind risks in Canada on behalf of managing agents agreed and signed.
- Conceptualising, tendering and developing an electronic system capable of administering the ASPS system.
- Identifying and registering all parties involved with Canadian business.
- The provision of training to over 300 super-users.
- The development of a new suite of LMA approved wordings and issuance to the market. Separate wordings were developed in respect of insurance and reinsurance business and for Canadian and Global business.
- The publishing of detailed documentation including an ASPS user guide and Frequently Asked Questions (FAQ’s).
- Frequent updates including regular market bulletins and a market-wide presentation kept the market advised of progress.
- Proposals agreed with Xchanging for insurer documentation processed through ASPS.
ASPS has been available to the market since 5 December 2011 and has been compulsory for all Canadian business incepting from 1 January 2012.
By the week of 16 January 2012 there were 406 firms registered on ASPS, of which 141 were registered in London and 265 registered in Canada. Over 600 individuals have been established on the system with super-user privileges and another 700 individuals registered as regular users.
Take up of the new system has increased significantly and as at the middle of January over 400 contracts have already been bound.
All correctly submitted contracts have been bound by the AIF within Lloyd’s proposed service standard of 48 hours.