1. Every managing agent shall act in accordance with Lloyd’s Principles of Doing Business for Claims Management.
Lloyd’s Claims Lead Arrangements, paragraph 8
2. Where a managing agent is required to act on behalf of a following Lloyd’s syndicate under the terms of these Claims Lead Arrangements (whether as the managing agent of the leading Lloyd's syndicate or of the second Lloyd's syndicate), then it must act in the best interest of all syndicates on whose behalf it acts. If the managing agent concludes that it cannot do so, then it must notify the managing agents of the Lloyd’s syndicates underwriting the insurance and (subject to any guidance Lloyd’s may from time to time prescribe) the managing agent of the next following Lloyd’s syndicate in slip order (which, in the case of the managing agent of the leading Lloyd’s syndicate shall be the managing agent of the second Lloyd’s syndicate) shall take its place for the purposes of the Claims Lead Arrangements (and the assignment of leading Lloyd’s syndicate, second Lloyd’s syndicate and following Lloyd’s syndicate shall be adjusted accordingly and as necessary). Lloyd’s may prescribe requirements for resolving any disagreements between managing agents of syndicates that underwrote an insurance that may arise regarding the proper application of this paragraph.
Lloyd’s Claims Lead Arrangements, paragraph 9
3. The managing agents of the leading Lloyd’s syndicate and, on complex claims, the second Lloyd’s syndicate may each delegate their determination of a CLA claim to another person, provided that the delegation complies with Lloyd’s requirements for the delegation of the determination of claims and is properly documented.
Lloyd’s Claims Lead Arrangements, paragraph 10
4. Managing agents can sometimes face difficult decisions as to whether they can properly act for the following market. As a result, disagreements can arise as to whether a managing agent should have authority under the CLA to determine claims. In such a case, Lloyd’s has prescribed the following requirements as provided for by paragraph [2. above].
- If a disagreement arises between managing agents as to whether the managing agent of the leading Lloyd’s syndicate or, on a complex claim, the managing agent of the second Lloyd’s syndicate can act as a claims agreement party on behalf of the following syndicates in compliance with paragraph 9 [2. above], then the disagreement shall first be referred to senior representatives of the managing agents involved in the disagreement who shall meet in a good faith effort to resolve the disagreement. If resolution is not achieved within 14 days from the date the disagreement was referred to these individuals, the matter shall be escalated to a board member responsible for claims at each managing agent who shall attempt to resolve the matter.
- If the disagreement is not resolved following compliance with step 1, the disagreement shall be referred to Lloyd’s and Lloyd’s may, at its discretion, appoint King’s Counsel to give an opinion on the matter in dispute. Any managing agent of a syndicate that underwrote the insurance that wishes to shall, either individually or jointly with other managing agents, be entitled to make written representations to the King’s Counsel in accordance with such directions as Lloyd’s may make. Lloyd’s, in its discretion, may also provide for the managing agents to make oral representations to the King’s Counsel. All managing agents of syndicates that underwrote the insurance shall be entitled to see all written material provided to or by the King’s Counsel and to attend at any oral representations. The King’s Counsel shall promptly, on the basis of the information provided and representations made, issue an opinion on the matter in dispute which shall include an opinion as to whether the managing agent subject to the dispute should remain as a claims agreement party. The costs of the King’s Counsel will be borne, unless otherwise agreed, equally by the managing agents whose position the King’s Counsel disagreed with.
- If the opinion of King’s Counsel is not accepted by the managing agents whose position the King’s Counsel disagreed with, then Lloyd’s may make such directions for the future determination of the claim, in accordance
with the CLA as it considers appropriate (which may include directing that a managing agent shall cease acting as a claims agreement party or that the CLA shall not apply to the claim). While Lloyd’s shall take into account the opinion of the King’s Counsel, it shall not be required to follow any particular course of action advised by the King’s Counsel.
Guidance on the Lloyd’s Claims Lead Arrangements, paragraph 3.25
5. Where considerations of a potential conflict of interest arise in relation to a following Lloyd’s syndicate as a result of which it may not be appropriate for the managing agent of that syndicate to receive information relating to the claim from the managing agent(s) that are determining the claim, Lloyd’s will, on an application, consider giving a dispensation to disapply the application of the CLA for that syndicate in respect of that claim.
Guidance on the Lloyd’s Claims Lead Arrangements, paragraph 3.26