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Hull Claims Protocol

2007 Update

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Hull Claims Protocol – IMCC 2006 Authority of Claims Leader Responsibilities of Claims Leader Provision of claims information Establishing and maintaining reserves for

claims and claims expenses Agreeing settlements Pursuing recoveries Financials ?

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Issues Agreement to adopt Leaders’ expertise, experience and resources Integration with existing market practices /

systems Impact of regulations

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The Next Step - Consultation France Germany Italy London Scandinavia USA

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Areas canvassed General reaction to concept Potential problems implementing Protocol

due to local regulations Potential for irreconcilable conflict with local

claims handling procedures Conflict with local laws Comments on wording Support for implementation

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France Leading Companies in favour of concept – “…a

good practical way to improve the international co-insurance claims processes which would benefit assureds.”

Provisions requiring broker involvement in relation to liaison with co-insurers should be included

Should be a separate agreement not in policy No foreseeable problems with implementation

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Germany Positive reaction to Protocol No conflict foreseen with local regulation or

laws but general practice is for followers to be bound by Leader’s decisions

Timeframes for reporting may be idealistic

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Italy Generally positive reaction Concerns re lack of information re followers

and role of brokers in communicating with followers

Concerns re tight reporting timeframes

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London Supportive of concept but in current form not

workable in London Market context Identified problems of compliance with London

Market claims schemes, FSA & Sarbanes-Oxley requirements

Consider that greater burden placed on brokers Need to define role of Leader in London context Should include provisions relating to involvement of

Surveyors and Average Adjusters

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Scandinavia Norway & Sweden – Positive reaction, no

particular concerns re implementation Denmark – Reasonably positive without being

enthusiastic, some concerns re prior approval of EU Law Commission

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USA Mixed response Concern - broker co-operation Concern - moving broker responsibilities to

Leader Concern - resources of Leaders

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Comments on wording Revise introduction to set out objectives along

lines of Lillehammer Protocol Include provision for counter-security where

Leader issues 100% LOU to third parties London Market – closely define role of

Leader Other comments clause specific

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Clause 2(b)

All claims shall be notified to the Claims Leader by the Assured or their Broker. The Claims Leader shall be responsible for:

(b) Ensuring that the Following Underwriters are advised of all claims notified under the insurance within 10 days of notification to them.

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Clause 2(d)All claims shall be notified to the Claims Leader by the Assured or their

Broker. The Claims Leader shall be responsible for:

(b) Ensuring that the Following Underwriters are provided with updated information regarding the claim, including revised reserves for the claim and claim expenses:

(i) within 30 days of the initial notification to the Following Underwriters,

(ii) whenever there is a significant development, but

(iii) at least every six months.

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Clause 2(e)

All claims shall be notified to the Claims Leader by the Assured or their Broker. The Claims Leader shall be responsible for:

(e) Agreeing interim and final claim settlements within the conditions of the insurance and advising such settlements to the Following Underwriters. However, in no event will the Claims Leader be responsible for the settlement of any claim on behalf of the Following Underwriters.

Substitution: “recommending”

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Clause 2(f)All claims shall be notified to the Claims Leader by the Assured or their Broker. The Claims Leader shall be responsible for:

DELETE?

(f) Negotiating and recommending compromised or commercial settlements and submitting same for the consideration of the Following Underwriters. However, for the avoidance of doubt, in no event shall any agreement to compromise any claim be binding on Following Underwriters.

OR AMEND?

(f) Negotiating and recommending ex-gratia settlements and submitting same for the consideration of the Following Underwriters. However, for the avoidance of doubt, in no event shall any agreement to compromise any claim be binding on Following Underwriters.

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Clause 4

The Claims Leader shall exercise discretion in the circulation of the reports of surveyors or other experts. In particular, the Claims Leader shall be under no obligation to provide reports of surveyors to Following Underwriters unless the 100% gross claim is expected to exceed €500,000.

Or: €1,000,000 or €2,000,000?

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Hull Claims Protocol

2007 Update