Tim Carroll assesses the IUA's first year and its progress so far in changing the way that the London market operates.
When the International Underwriting Association of London (IUA) came into existence just a year ago, we sensed a tremendous amount of goodwill. The new association was welcomed worldwide as the single voice for international (re)insurance companies trading through the London market. In return, we promised that the association would “make a difference”.
We said that the IUA would work closely with Lloyd's to streamline the London market and make it a more accessible place to do business, with its international customers particularly in mind. Together with Lloyd's, at our suggestion, we jointly created the IUA/Lloyd's forum.
Such a development would not have been possible without a single representative body for the companies in London. Indeed, our alliance with Lloyd's lies at the heart of IUA's strategy. Fortunately, Lloyd's chairman Max Taylor and chief executive Nick Prettejohn are at one with us on what needs to be done. The forum's main aim is to drive through reform, make the market more efficient, and make better use of information technology. It means speeding processes such as the payment of claims and premiums, harmonising wordings, business processes and, especially the work of the two back office bureaux. And it means more transparency.
We are very clear that London's role is to provide a platform for the global industry. We are light years away from the “Fortress London” mentality and the insularity that once threatened to drive a wedge between London and the rest of the world and which would have made us irrelevant. The forum is a driving force for change.
Change in the way that we do business has shaped another crucial area where the IUA has been active: in the encouragement of the use of e-commerce in the market. Last year saw the creation of WISe (Worldwide InSurance e-commerce). The result of the merger of LIMNET, RINET and WIN, it is the basis of a global electronic standards authority for the insurance and reinsurance industries. WISe is a huge achievement - the alternative was a plethora of private arrangements that would have been confusing and inefficient. The next few years will determine whether the market seizes the opportunities.
Equally important in our first busy year has been looking at our own work and carrying out a thorough review of the association's services to its members. While we have maintained the levels provided by the IUA's predecessors, Institute of London Underwriters (ILU) and the London International Insurance and Reinsurance Market Association (LIRMA), we hope that improvements will start to feed through this year. Our work in education and training continues, and we have been especially active in the area of research.
• The IUA (formerly ILU) marine statistics were well received at the International Union of Marine Insurance, and we continue to produce earthquake hazard atlases.
• The Second UK Bodily Injury Awards Study, produced with the Association of British Insurers, was recognised as an outstanding piece of work.
• We will shortly be publishing research from the London School of Economics, commissioned jointly with the Lloyd's Market Association, into the competitiveness of the London market.
With regard to representation, the feedback to having a single voice has been entirely positive. For example, while hosting an international regulatory conference in London, we were told by US commissioners and several other international visitors that dealing with one association was easier, more efficient and more effective.
This feeling has permeated all our representations - whether in the United States, with the various bodies of the European Union, in talks with the Financial Services Authority, the General Insurance Standards Council, or in preparations for the World Trade Organisation General Agreement on Trade and Services 2000 round of negotiations.
In August, Max Taylor and I made a highly successful visit to Atlanta, Georgia - the first time the London market had been jointly represented at this level. This level of co-operation would have been unthinkable a few years ago. By itself it does not, of course, achieve anything. Results are what matter. I am confident, however, that 2000 will see tangible progress.
The priority is to create a seamless, efficient, streamlined market in London. I feel we at the IUA can honestly say we have made a start to what will be a long and tough process of change. It is up to us to continue to drive forward with that change. We still have a long way to go.
Tim Carroll is chairman of the International Underwriting Association of London (IUA) and chief executive of the UK non-life operations of ERC Frankona.