Computable Binding Authority Agreement (CBAA)
Description: Computable Binding Authority Agreement (CBAA) Model Wording Consultation Q3 2024 A guide for consultation participants 14th August 2024 2 Agenda 1. Overview of DARE the CBAA initiative 2. Overview Purpose of the Consultation 3.
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slide1. Computable Binding Authority Agreement (CBAA) Model Wording Consultation Q3 2024
A guide for consultation participants 14th August 2024<br>
slide2. 2 Agenda
1. Overview of DARE & the CBAA initiative
2. Overview & Purpose of the Consultation
3. Consultation Materials & How to Read Them
4. Digital Language for the Consultation
5. How to Provide Your Feedback
8. Closing Messages
9. Questions A Guide to the CBAA Model Wording Consultation - 14th August 2024<br>
slide3. 3 A credible discovery process Managing Agent representatives 174 Claims Representatives Coverholders Brokers Independent consultants Broker Coverholder 75 32 12 9 14 64 concepts grouped into 8 key areas Delegated Authority Re-imagined (DARE) In 2021, an end-to-end Vision for a Digital DA Marketplace – created by the DA community, for the DA community<br>
slide4. 4 Desire for a digital DA marketplace 2 Key Intentions:
Re-draft the contractual language to reflect current practice and market needs
Turn that language into data from which digital contracts can be created Design & Build of a Computable Binding Authority Agreement (CBAA) Out of date binding authority contract documents<br>
slide5. 5 Who?
DA stakeholders across the Lloyd’s and wider London Market are being invited to participate
This includes those working within Managing Agent, Broking & Coverholder firms
Any individual can participate & provide feedback, but it may be useful to collate views and provide a single response per firm
Individuals participating will need to have a good understanding of Delegated Authority contracting and be familiar with the LMA model wordings used today i.e. LMA 3113/4/5, IUA Binding Authority Agreement, Lloyd’s Europe CAA
This is a review of Model Wordings not technology but note that digitisation does impact the language used Overview & Purpose of the Consultation<br>
slide6. 6 What?
Participants are to review 2nd Drafts of 4 of the 15 CBAA Modules
The 4 modules have been created by Axiome Partners in collaboration with the LMA DA Wordings Group and are a work in progress
We strongly advise you review M6 & M11 first, followed by M11
M5 will be released in a couple of weeks with video guidance
Participants are to provide their feedback using the feedback forms provided on lmadare.co Overview & Purpose of the Consultation<br>
slide7. 7 Overview & Purpose of the Consultation Where?
lmadare.co has been updated
2nd Drafts of the 4 Modules are available on the website for you to download and review
The website has a feedback form for each Module, but you do not have to provide feedback for all Modules
We are expecting a lot of feedback and therefore cannot accept any feedback unless it is via the forms provided<br>
slide8. 8 Overview & Purpose of the Consultation When?
14th August Consultation Guidance Session – 1- 2pm
15th August Drafts for M6, M11 & M9 & Feedback Forms available on lmadare.co
30th August M5 Draft and Video Guidance available on lmadare.co
4th September Virtual Mid-Consultation Q&A – please contact vicky.moss@lmalloyds.com if you are interested in attending
30th September Consultation period ends<br>
slide9. 9 Why?
We want to ensure the London Market is an easy place to trade in and with
The more consistent a London Market experience the more attractive it will be
With the CBAA we have the chance to simplify, streamline and future proof DA contracting
We need your input to get this right and ensure the contract we produce caters for varying needs
If the words aren’t right the digital bit doesn’t matter Overview & Purpose of the Consultation<br>
slide10. 10 Consultation Materials & How to Read Them Access materials for each module by clicking the ‘+’ icon Each module has:
a guidance document
an ‘ALL VARIATIONS’ draft
one or more completed examples You must read the guidance document before reviewing the ‘ALL VARIATIONS’ draft The examples show what a completed Module would look like when the appropriate variations have been selected<br>
slide11. 11 We are creating a Single Binding Authority Agreement Model Wording for London, that can be used interchangeably between and across markets, classes and territories. Consultation Materials & How to Read Them The single model wording can be used for Company only binders, just as it can be used for Lloyd’s, Lloyd’s Europe or for mixed market binders. 60% of language can remain consistent across all markets, classes and territories, and the intention is for the London market to adopt this language as standard. 40% of the language will vary based on certain conditions, with a few clauses warranting the option for bespoking.<br>
slide12. 12 Only a single variation of the clause will be included in a CBAA instance. Clause Variations – are clauses that are mandatory but where a number of variations exist If a clause has variations, the clause number will be consistent but different variations are indicated by a highlighted letter A/B/C etc. The variation to be included will be based upon certain conditions and selected automatically or the Contract Creator may have a choice.<br>
slide13. 13 A comment has been added to the first instance of the clause number with an explanation of the conditions for inclusion. Sometimes it will simply be Contract Creator/user choice. Some variations have additional provisions that are specific to that particular variation, these are indicated using the variation letter. In the example only 6.1 has additional provisions.<br>
slide14. 14 They are not mandatory and will only be present in some CBAA instances. Optional and Conditional Clauses are shown in darkest grey A comment will be added to the clause number with an explanation of the conditions for inclusion. Sometimes it will simply be Contract Creator/user choice. They are either automatically included because certain conditions are true, or the Contract Creator/user may have a choice.<br>
slide15. 15 Digital Language for the Consultation Data ‘Things’ are known as… Digital Objects The digital world has its own language some of which is relevant to the CBAA consultation<br>
slide16. 16 Digital Language for the Consultation (Contract) Text Objects Embedded Variables Referenced Table Objects
(Data Structures) Referenced Document Objects Data Object Formatting is also key Guidance Objects
(including Defined Terms) Different types of digital objects are found within CBAA Modules…<br>
slide17. 17 Text Objects Any numbered clause in the CBAA is a single text object. The examples shown are simple Text Objects. A group of 7 text objects from M11 A single text object from M6 Text Objects can have other types of digital objects within them…<br>
slide18. 18 Embedded Variables are indicated in red non-bold and appear within the contract text Embedded Variables are contract specific and will usually be selected by the Contract Creator, sometimes they may be decided by the application of built-in rules. Embedded Variables may well be drawn from a more comprehensive data structure or selected from a dropdown list in the CBAA creation process.<br>
slide19. 19 Within the consultation ‘ALL VARIATIONS’ draft Modules, Embedded Variables are always presented as a single example of the variable and shown between angle brackets < >. Both examples below contain 3 Embedded Variables each.<br>
slide20. 20 Note that where we have issued an example of any given module, footnotes and angle brackets do not appear so that the example reflects more closely the look of the final Agreement produced. To understand how the Embedded Variable is populated mouseover the footnote and this information, along with the Embedded Variable Number and Name, will be displayed. Footnote & Embedded Variable Number Mouseover Pop-up Box Embedded Variable Name 2 variations for Embedded Variable 6.4<br>
slide21. 21 Referenced Objects are indicated in blue bold; the detail of the referenced object will be displayed in a separate window when the user clicks on the text. There are 2 types of referenced object: Table Objects
a Data Structure where all variables are fully reportable Insurers Bank Account Details Table<br>
slide22. 22 Referenced Objects are indicated in blue bold, there are 2 types of referenced object: Document Objects
usually referred to as an ‘Annex’ or ‘Instructions’ this is a PDF attachment, content will not be digitised at this stage Blue Bold Text is also used when there is a link back to another part of the Agreement<br>
slide23. 23 The detail of the referenced object will be displayed in a separate window when the user clicks on the text, or viewed as a pop-up when the user mouseovers the text Document Objects Table Object Within consultation examples, an example of each Table or Document Object referenced will be included at the end of the Module.<br>
slide24. 24 6.2A The Coverholder is not authorised to allow any part of their Commission to any Producing Intermediary. Defined Terms – are black non-bold with all words that are part of the term capitalised ‘Coverholder’, ‘Producing Intermediary’ and ‘Commission’ are the 3 defined terms in this example Although it has been agreed that any capitalised term will be defined, the definition has not yet been agreed upon and so definitions are not part of this consultation but are a work in progress. If we have missed anything that you think should be defined, please let us know as part of your feedback. Definitions of Defined Terms will appear within a pop-up if you mouseover the Defined Term, they will also all appear collectively in ‘Module 0 – Definitions’. There are 3 types of Guidance Objects:<br>
slide25. 25 Technical Guidance Objects and System Guidance Objects are not included in this consultation Areas requiring technical guidance have been discussed but will only be drafted once Defined Terms are confirmed. If there are particular areas where you think guidance will be needed in addition to a Defined Term, please let us know as part of your feedback. However Technical Guidance will be displayed within a pop-up when the user mouseovers the text to which the guidance relates And System Guidance will be displayed when the user clicks on the information icon<br>
slide26. 26 An example to bring it all together…<br>
slide27. 27 How to Provide Your Feedback A feedback form for each Module is available on lmadare.co We require that feedback be attributed to the relevant clause number General comments about the Module can be provide as ‘any other comments’ Click on the Module you are providing feedback for and then complete the form and submit<br>
slide28. 28 The drafts are a work in progress they are NOT the finished article What Type of Feedback Should You Provide? Point out typos, grammatical errors, language that doesn’t make sense to you If the wording of a particular clause doesn’t work for you, suggest what would, but please be pragmatic and ask yourself does the current language do the job well enough If you couldn’t use the Modules as they are currently drafted tell us why Highlight anything that is missing, any additional defined terms required, or areas where guidance is needed, but be mindful of what may be found within other Modules not yet shared Tell us what you like and what works well Ask questions that you have, we can generate FAQs and prepare answers for the September Q&A<br>
slide29. 29 Creation of a Computable Binding Authority Agreement is the first step in realising the DARE Vision of a Digital DA Marketplace
Time needs to be taken to design digital foundations before building tech solutions
The drafts are a work in progress, we expect you to find things we have missed
Alignment with the CDR is key, this means you will see some new terminology in the drafts
Start with M6 & M11
Watch the M5 guidance video before diving into your review
We should be ready to embrace change – the new wording will look quite different – this will not be easy
We must be open to compromise if we are to realise all the benefits of digital
Please review with a ‘can do’ attitude how can we make it work rather than it won’t work because Closing Messages<br>
slide30. CBAA Questions? For more information contact:
Carla Wise carla.wise@lmalloyds.com
Vicky Moss Vicky.moss@lmalloyds.com
or visit our website LMA Dare | Home<br>
A guide for consultation participants 14th August 2024<br>
slide2. 2 Agenda
1. Overview of DARE & the CBAA initiative
2. Overview & Purpose of the Consultation
3. Consultation Materials & How to Read Them
4. Digital Language for the Consultation
5. How to Provide Your Feedback
8. Closing Messages
9. Questions A Guide to the CBAA Model Wording Consultation - 14th August 2024<br>
slide3. 3 A credible discovery process Managing Agent representatives 174 Claims Representatives Coverholders Brokers Independent consultants Broker Coverholder 75 32 12 9 14 64 concepts grouped into 8 key areas Delegated Authority Re-imagined (DARE) In 2021, an end-to-end Vision for a Digital DA Marketplace – created by the DA community, for the DA community<br>
slide4. 4 Desire for a digital DA marketplace 2 Key Intentions:
Re-draft the contractual language to reflect current practice and market needs
Turn that language into data from which digital contracts can be created Design & Build of a Computable Binding Authority Agreement (CBAA) Out of date binding authority contract documents<br>
slide5. 5 Who?
DA stakeholders across the Lloyd’s and wider London Market are being invited to participate
This includes those working within Managing Agent, Broking & Coverholder firms
Any individual can participate & provide feedback, but it may be useful to collate views and provide a single response per firm
Individuals participating will need to have a good understanding of Delegated Authority contracting and be familiar with the LMA model wordings used today i.e. LMA 3113/4/5, IUA Binding Authority Agreement, Lloyd’s Europe CAA
This is a review of Model Wordings not technology but note that digitisation does impact the language used Overview & Purpose of the Consultation<br>
slide6. 6 What?
Participants are to review 2nd Drafts of 4 of the 15 CBAA Modules
The 4 modules have been created by Axiome Partners in collaboration with the LMA DA Wordings Group and are a work in progress
We strongly advise you review M6 & M11 first, followed by M11
M5 will be released in a couple of weeks with video guidance
Participants are to provide their feedback using the feedback forms provided on lmadare.co Overview & Purpose of the Consultation<br>
slide7. 7 Overview & Purpose of the Consultation Where?
lmadare.co has been updated
2nd Drafts of the 4 Modules are available on the website for you to download and review
The website has a feedback form for each Module, but you do not have to provide feedback for all Modules
We are expecting a lot of feedback and therefore cannot accept any feedback unless it is via the forms provided<br>
slide8. 8 Overview & Purpose of the Consultation When?
14th August Consultation Guidance Session – 1- 2pm
15th August Drafts for M6, M11 & M9 & Feedback Forms available on lmadare.co
30th August M5 Draft and Video Guidance available on lmadare.co
4th September Virtual Mid-Consultation Q&A – please contact vicky.moss@lmalloyds.com if you are interested in attending
30th September Consultation period ends<br>
slide9. 9 Why?
We want to ensure the London Market is an easy place to trade in and with
The more consistent a London Market experience the more attractive it will be
With the CBAA we have the chance to simplify, streamline and future proof DA contracting
We need your input to get this right and ensure the contract we produce caters for varying needs
If the words aren’t right the digital bit doesn’t matter Overview & Purpose of the Consultation<br>
slide10. 10 Consultation Materials & How to Read Them Access materials for each module by clicking the ‘+’ icon Each module has:
a guidance document
an ‘ALL VARIATIONS’ draft
one or more completed examples You must read the guidance document before reviewing the ‘ALL VARIATIONS’ draft The examples show what a completed Module would look like when the appropriate variations have been selected<br>
slide11. 11 We are creating a Single Binding Authority Agreement Model Wording for London, that can be used interchangeably between and across markets, classes and territories. Consultation Materials & How to Read Them The single model wording can be used for Company only binders, just as it can be used for Lloyd’s, Lloyd’s Europe or for mixed market binders. 60% of language can remain consistent across all markets, classes and territories, and the intention is for the London market to adopt this language as standard. 40% of the language will vary based on certain conditions, with a few clauses warranting the option for bespoking.<br>
slide12. 12 Only a single variation of the clause will be included in a CBAA instance. Clause Variations – are clauses that are mandatory but where a number of variations exist If a clause has variations, the clause number will be consistent but different variations are indicated by a highlighted letter A/B/C etc. The variation to be included will be based upon certain conditions and selected automatically or the Contract Creator may have a choice.<br>
slide13. 13 A comment has been added to the first instance of the clause number with an explanation of the conditions for inclusion. Sometimes it will simply be Contract Creator/user choice. Some variations have additional provisions that are specific to that particular variation, these are indicated using the variation letter. In the example only 6.1 has additional provisions.<br>
slide14. 14 They are not mandatory and will only be present in some CBAA instances. Optional and Conditional Clauses are shown in darkest grey A comment will be added to the clause number with an explanation of the conditions for inclusion. Sometimes it will simply be Contract Creator/user choice. They are either automatically included because certain conditions are true, or the Contract Creator/user may have a choice.<br>
slide15. 15 Digital Language for the Consultation Data ‘Things’ are known as… Digital Objects The digital world has its own language some of which is relevant to the CBAA consultation<br>
slide16. 16 Digital Language for the Consultation (Contract) Text Objects Embedded Variables Referenced Table Objects
(Data Structures) Referenced Document Objects Data Object Formatting is also key Guidance Objects
(including Defined Terms) Different types of digital objects are found within CBAA Modules…<br>
slide17. 17 Text Objects Any numbered clause in the CBAA is a single text object. The examples shown are simple Text Objects. A group of 7 text objects from M11 A single text object from M6 Text Objects can have other types of digital objects within them…<br>
slide18. 18 Embedded Variables are indicated in red non-bold and appear within the contract text Embedded Variables are contract specific and will usually be selected by the Contract Creator, sometimes they may be decided by the application of built-in rules. Embedded Variables may well be drawn from a more comprehensive data structure or selected from a dropdown list in the CBAA creation process.<br>
slide19. 19 Within the consultation ‘ALL VARIATIONS’ draft Modules, Embedded Variables are always presented as a single example of the variable and shown between angle brackets < >. Both examples below contain 3 Embedded Variables each.<br>
slide20. 20 Note that where we have issued an example of any given module, footnotes and angle brackets do not appear so that the example reflects more closely the look of the final Agreement produced. To understand how the Embedded Variable is populated mouseover the footnote and this information, along with the Embedded Variable Number and Name, will be displayed. Footnote & Embedded Variable Number Mouseover Pop-up Box Embedded Variable Name 2 variations for Embedded Variable 6.4<br>
slide21. 21 Referenced Objects are indicated in blue bold; the detail of the referenced object will be displayed in a separate window when the user clicks on the text. There are 2 types of referenced object: Table Objects
a Data Structure where all variables are fully reportable Insurers Bank Account Details Table<br>
slide22. 22 Referenced Objects are indicated in blue bold, there are 2 types of referenced object: Document Objects
usually referred to as an ‘Annex’ or ‘Instructions’ this is a PDF attachment, content will not be digitised at this stage Blue Bold Text is also used when there is a link back to another part of the Agreement<br>
slide23. 23 The detail of the referenced object will be displayed in a separate window when the user clicks on the text, or viewed as a pop-up when the user mouseovers the text Document Objects Table Object Within consultation examples, an example of each Table or Document Object referenced will be included at the end of the Module.<br>
slide24. 24 6.2A The Coverholder is not authorised to allow any part of their Commission to any Producing Intermediary. Defined Terms – are black non-bold with all words that are part of the term capitalised ‘Coverholder’, ‘Producing Intermediary’ and ‘Commission’ are the 3 defined terms in this example Although it has been agreed that any capitalised term will be defined, the definition has not yet been agreed upon and so definitions are not part of this consultation but are a work in progress. If we have missed anything that you think should be defined, please let us know as part of your feedback. Definitions of Defined Terms will appear within a pop-up if you mouseover the Defined Term, they will also all appear collectively in ‘Module 0 – Definitions’. There are 3 types of Guidance Objects:<br>
slide25. 25 Technical Guidance Objects and System Guidance Objects are not included in this consultation Areas requiring technical guidance have been discussed but will only be drafted once Defined Terms are confirmed. If there are particular areas where you think guidance will be needed in addition to a Defined Term, please let us know as part of your feedback. However Technical Guidance will be displayed within a pop-up when the user mouseovers the text to which the guidance relates And System Guidance will be displayed when the user clicks on the information icon<br>
slide26. 26 An example to bring it all together…<br>
slide27. 27 How to Provide Your Feedback A feedback form for each Module is available on lmadare.co We require that feedback be attributed to the relevant clause number General comments about the Module can be provide as ‘any other comments’ Click on the Module you are providing feedback for and then complete the form and submit<br>
slide28. 28 The drafts are a work in progress they are NOT the finished article What Type of Feedback Should You Provide? Point out typos, grammatical errors, language that doesn’t make sense to you If the wording of a particular clause doesn’t work for you, suggest what would, but please be pragmatic and ask yourself does the current language do the job well enough If you couldn’t use the Modules as they are currently drafted tell us why Highlight anything that is missing, any additional defined terms required, or areas where guidance is needed, but be mindful of what may be found within other Modules not yet shared Tell us what you like and what works well Ask questions that you have, we can generate FAQs and prepare answers for the September Q&A<br>
slide29. 29 Creation of a Computable Binding Authority Agreement is the first step in realising the DARE Vision of a Digital DA Marketplace
Time needs to be taken to design digital foundations before building tech solutions
The drafts are a work in progress, we expect you to find things we have missed
Alignment with the CDR is key, this means you will see some new terminology in the drafts
Start with M6 & M11
Watch the M5 guidance video before diving into your review
We should be ready to embrace change – the new wording will look quite different – this will not be easy
We must be open to compromise if we are to realise all the benefits of digital
Please review with a ‘can do’ attitude how can we make it work rather than it won’t work because Closing Messages<br>
slide30. CBAA Questions? For more information contact:
Carla Wise carla.wise@lmalloyds.com
Vicky Moss Vicky.moss@lmalloyds.com
or visit our website LMA Dare | Home<br>