While the London market continues to move towards a more transparent system for loss funds as Craig Armstrong, Delegated Authority Manager at Davies, explains there is still significant amounts which remain unclaimed as legacy issues continue.

The benefits underwriters can derive from a focus on legacy loss funds has been evidenced in recent months as our dedicated Legacy Loss Fund Service has delivered real results. We have returned back to the “market” over £9 million across 60 loss funds to an individual client and the client is averaging a return of £500,000 in loss funds per month.

The fact that the classes involved in these funds include Aviation, A&H, Casualty, Marine, Specialty and Property, highlight the breadth of the legacy loss funds that remain across the market. The funds recovered were through 15 different brokers and were spread across the 2007-2017 years of account.

There is a growing understanding of the need to drive greater transparency around loss funds and in the London market’s Blueprint 2, there are systems in place which are seeking to eradicate loss funds. It is a fundamental change from the more traditional practice where the coverholder or TPAs held the funds on behalf of the underwriter.

For Davies and our dedicated team, it allows us to work with our clients to reconcile their legacy loss funds, to release known and unknown assets. Through our forensic reviews, we continue to see a significant number of legacy loss fund assets which are still to be identified and managed.

We provide a dedicated team that has a proven track record of the effective legacy loss fund management. Our results continue to be positive for our clients and there is nothing to indicate that the issue shows any signs of abating in the short to medium term.

Ultimately, the success of the service is simply judged on the value of funds that the underwriter may have not realised were still outstanding or the underwriter recognises there is an outstanding amount but does not have the experience or in house expertise to cost effectively undertake a recovery of those funds.

If you would like to continue the conversation, get in touch with Delegated Authority Manager, Craig Armstrong at craig.armstrong@davies-group.com