Cargo & Freight Insurance | London Cargo Market | JLT

24 November 2015

This issue, Richard Foulger from AEGIS London and Tom Newman from Amlin join Garry Cordess and Jared Prince from our Cargo team to talk about cargo claims.

What value does a claims broker bring to clients and the London market? 

Richard: It is the choice of the broker what value they add. We see brokers who don’t want to get involved at all unless they are paid a fee, all the way through to specialist claims brokers who really do add value. 

Tom: It’s very useful to have somebody that acts as a facilitator. There are many, many jobs to do on a big claim. With the likes of JLT, we are able to talk directly to the broker, who can then pass information and questions on to the insureds promptly, and so on. It’s an easier process than putting questions on to a system and waiting for a response. 

Garry: I’ve seen a change in terms of the role of the broker, because previously when there were complex claims, it would be down to the broker to go and talk to the rest of the market. What we are seeing increasingly is the market taking that on and insurers talking among themselves. 

Richard: Some brokers basically disappear because of the use of electronic claims files (ECF). They don’t even come to see us when they know there is a problem, so it’s no surprise that insurers start talking to each other.

From a claims perspective, what can the London market do better than other markets – and is enough done to promote its success? 

Richard: This is the leading cargo market in the world. There’s no other market that matches the way we do cargo – the expertise, the knowledge that’s here.

Garry: In terms of large, well-publicised events such as the Transocean (BP spill) and the Virgin Galactica incident, the insurers stepped up very quickly and paid within a few days. The total loss for Transocean was GBP 562 million, which the London market paid in nine days. 

Richard: This market is good at handling large claims. 

Tom: Another key differentiator is that we have to work with our competitors and fellow insurers to bring about a resolution to a claim issue in the best and most suitable way. I find our approach to it is that we have standards. We have Lloyd’s standards, we have the company’s own standards and we try to manage the process in a financially fair way. 

Garry: We’re all in walking distance of each other. That, I think for me, is the main difference between the London market and other competitive markets – the fact that we can actually go and see people. I think it’s so important that we do that, because otherwise the younger generation won’t have the contacts or the relationships. 

Richard: The broker has to own that and ensure they push their brokers to keep an element of face to face dealing. 

Jared: ECF has served a purpose. Gone are the days of queuing up at a box for 45 minutes with a fee bill for USD 200. However ECF has now gone so far in the other direction that there are no queues anymore – so there is no excuse not to be out and engaging with our markets. It’s easier for you, it’s easier for us – and ultimately it means a quicker response for the client, which is what it’s all about. 

Richard: In terms of promoting the market’s success, at AEGIS, we overtly sell our own claims service – every managing agent does – but rarely in publications do you see the London market or Lloyd’s mentioned. 

Garry: Is there then something we could be doing better, to put London in the shop window? 

Richard: I think that we’re challenging that at the moment. I don’t think we have an answer as a market.

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For more information please contact Garry Cordess, Senior Partner on +44(0)207 558 3012