As September brings more industry activity, we’ve compiled key regulatory updates in insurance and compliance sectors. This September’s highlights include Lloyd’s call for aggregate cyber data submissions to shape future disaster scenarios, new oversight on legacy deals starting in 2025, and enhanced performance data monitoring for delegated business. We also cover Lloyd’s fee structure changes aimed at supporting market competition, Velonetic’s updated project timeline, and insights into data challenges affecting European Nat-Cat losses. Explore these developments and more in this edition!

Lloyd’s Q3 Market Message

Watch the Q3 Market Message here

Aggregate Cyber Data

Lloyd’s has requested aggregate cyber data to be submitted in early Q4 2024. This data will be crucial in shaping more refined Realistic Disaster Scenarios (RDS) for 2025, with the goal of implementing these changes by 2026. Lloyd’s will co-publish a paper to define what constitutes a major cyber event, offering a more comprehensive framework for assessing and managing cyber risks in the market.

Legacy Deals

From January 1, 2025, all new legacy transactions will undergo a mandatory pre-transaction review by Lloyd’s. This review process will require active involvement from both the buyer and seller, ensuring greater oversight and clarity in these deals. The goal is to maintain transparency and mitigate potential risks associated with legacy portfolios.

Delegated Business

Lloyd’s is set to enhance its performance oversight on delegated authority business. Rachel Turk emphasised the need for real-time, high-quality data, noting that the market is still receiving outdated bordereaux data in 2024. The focus will be on improving the timeliness and accuracy of performance data to ensure better risk management and market efficiency.

Lloyd’s Fees

Starting January 1, 2025, Lloyd’s will introduce a capped fee structure aimed at making the market more commercially attractive. Fees will be capped at 1% of Gross Written Premium (GWP), based on syndicate business forecasts (SBF). For “Syndicates in a Box,” fees will start at 0.1%, rising incrementally to 0.35% for syndicates with GWP exceeding £3 billion. This change is intended to support smaller and emerging syndicates, fostering competition and innovation in the market.

Blueprint 2 Replan

Velonetic has announced a revised plan for phase one of its digital project after the originally scheduled October 2024 cutover was delayed. The new leadership team will focus on completing the technology build by January 2025, followed by Vanguard testing in Q1 2025. LIMOSS-coordinated customer testing will also start no earlier than Q1 2025. The re-plan aims to provide a structured approach to the technology platform, testing timelines, and quality assurance, while ensuring alignment with regulatory notifications and market assurance activities throughout the process. Read more

Data Shortfalls and European Nat-Cat Losses

Insurers are facing challenges with natural catastrophe loss estimates in Europe due to insufficient data. These data gaps contribute to loss creep, making accurate predictions harder and increasing financial risks. Read more

Data Sharing for Growth in Insurance

Former Hiscox CEO Bronek Masojada stresses that better data sharing across the insurance industry can lead to significant growth and a larger market share for all players. Read more

Stay updated on these industry trends!