Market shows slow electronic take-up

The success of the electronic trading reforms at Lloyd's has been called into question after an apparent lack of take-up by the market.

The amount of business being transacted through the electronic claims file (ECF) and accounting and settlement (A&S) repositories is understood to be far less than first anticipated.

One market source said: "Things are not progressing as everybody had planned.

"While there has been a lot of clear thinking around what needs to happen and support from the upper echelon of the market, when it comes down to the practicalities of delivering this there doesn't appear to be the willingness to push it any further."

Sources said that work on achieving contract certainty has diverted investment and time away from other business process reforms leading to a lack of compulsion on the part of the market to adopt the document repositories.

But according to official figures, 15% of new claims are being processed through ECF, with some 60,000 premium-related documents in the London market also being handled electronically.

A spokesperson for the Market Reform Group, which is leading the work, said: "Good progress is being made with the market repository, and we are seeing the first real step change towards electronic processing in the market.

"All Lloyd's managing agents writing subscription business who would use the ECF have agreed to the rules governing it, and currently two thirds of all managing agents are processing claims electronically."

Some have questioned the actual volumes being processed, but one technology expert has warned that the real issue was around how the reforms fitted into the wider market.

David Ballard, consulting services director at IT solutions provider Northdoor, said: "An area where the greatest uncertainty exists at the moment is the centre-backed initiatives and how they fit in with what G6 is doing in ploughing its own furrow.

"It is also difficult for medium-sized organisations to know where they fit in."