The Reinsurance To Close (RITC) market is changing and as James Jacob, Director of Insurer and Market Services explains, there is a real demand for expertise as the use of greater technology is providing the opportunity to access unidentified loss funds, uncollected premium and claims management.

In terms of transactions, the RITC sector remains busy and the numbers are increasing as it sees the arrival of several new players. While the traditional companies are still looking to do business from our point of view, we are seeing demands from clients for enhanced support.

Our team are working with many clients to identify redundant and unidentified loss funds to ensure funds are returned to their rightful owner. In the case of unidentified funds, the bonus is that these amounts go straight to the bottom line. It’s an area that we have looked to highlight to the market for some years and the sums successfully returned to clients have been considerable. There is no doubt that the combination of using technology in conjunction with our trusted processes have enhanced the ability to return significant funds that could be used elsewhere.

We are also seeing an increase in the importance of capturing granular data and being able to report discrepancies, and we’re one of the first companies to provide bordereau management via a bespoke system. Within the RITC sector concerns remain over the size and number of claims still coming through even as the deals are being structured. There is importance on whether granular level claims are being reported to the correct years and that all claims presented have an associated premium reported and paid. The fact our service provides a people and system solution with access to bespoke reporting as well as standardised reporting is hugely important in the governance of Delegated business.

When we consider Brexit and the Lloyd’s Part VII transfer, whether it is via our Loss Fund Service or Bordereau Management service, we’re seeing further effort and management required in either the identification and splitting of mixed transferring EEA and Non-EEA exposed loss funds or the splitting and identification of EEA exposures within bordereaux.

In terms of the services we’re providing to managing agents, much of the work we have been doing is around credit control. Managing agents have often amended their EPI in line to premiums that have been received. They now realise they should be challenging brokers and asking them “have we received all the premiums due?” Ensuring that all premiums have been collected can create additional funds for RITC transactions and is something that the market does need to focus on.

In order to support the RITC transactions as they’re being completed  we are working with our partners to help in the integration of both systems and data and for many with the transfer to new systems. Our clients benefit from the broad experience of our teams who have worked with most of the systems used across the market and with many of the new systems which are part and parcel of the London market’s transformation process.

It is indicative of the current stage of the RITC market that we are increasingly asked not only to provide services but also resources. We have seen a surge in demand as clients struggle with higher workloads and different operating systems and can see the demand for services and resource increasing as the benefits of effective management of RITC transactions continues.

For more information on Reinsurance To Close please contact James Jacob on james.jacob@davies-group.com.