We trialled the new Lloyd’s audit scope across 25 binders, placed through 5 entities, and found it to be far more focused on the risks of transaction business via Binding Authorities.
Lloyd’s Coverholders vary widely around the world. From multinational brokers servicing a wide range of classes, to small firms offering specialist coverage. All must pass a rigorous audit and compliance process to retain their coveted ‘Coverholder at Lloyd’s’ status. But up until recently, this process has tended to be something of a one-size-fits-all approach, until now….
Making London more attractive for Coverholders and taking a more ‘risk based’ approach is at the heart of a new Lloyd’s Audit Scope.
Intended to replace the 2014 V2 Coverholder Audit Scope, this new system has been over a year in the planning, having been piloted in 2017. It’s a big step change and due for roll-out in early 2018.
The earlier Audit Scope was essentially a question set – 288 to be precise – that did not change year-on-year and were not all necessarily relevant for each Coverholder’s business. Many considered this approach to not only be repetitive, but also onerous; whilst Managing Agents did not necessarily gain the information needed to manage their delegated underwriting, as evidenced by an increase in supplementary information being submitted.