XCHANGING

Introduction to Global Insurance

Services

10 July 2014

© 2014 Xchanging plc

Introduction

Introduction to Insurance Services

Xchanging Claims

Go to Market Offerings

Adrian Guttridge - Executive Director of Insurance Services

2

INTRODUCTION TO

INSURANCE

SERVICES Max Pell

Managing Director Insurance

© 2014 Xchanging plc

BUT IT’S NOT JUST THE LONDON INSURANCE MARKET…

OUR GLOBAL INSURANCE CLIENTS

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Global Strength and Solutions

Provider of insurance services & software, not products

Focus on commercial Property, Casualty & Workers

Compensation

Globally balanced work-force

Mission critical services supporting Headline News events

© 2014 Xchanging plc

1. XIS (policy admin, accounting & settlement)

2. XCS (claims)

3. XBS (broking: Aon & Cooper Gay)

4. NSW government (Workers Compensation)

5. Victoria government (Workers Compensation)

XCHANGING’S INSURANCE OPERATIONS

Over 2,500 insurance practitioners amongst our 8,000 employees *

Insurance operations in 3 of our key countries

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Xchanging’s Principal Locations

UK France Germany Italy India Malaysia Australia Americas Singapore

• LONDON

•BASILDON

•CHATHAM

• FOLKESTONE

•ROMFORD

• LEICESTER

•Preston

•Glasgow

• Basingstoke

•Paris •Hof

•Munich

•Milan •BANGALORE

• SHIMOGA

•GURGAON

• SOLAN

•Chennai

•Mumbai

•Kuala Lumpur

• SYDNEY

•MELBOURNE

•Adelaide

• Brisbane

•Chicago

•New York

• Bermuda

• Singapore

Key insurance contracts

Insurance differentiators

• Innovation (Netsett, X-presso, etc.)

• Complex processing and deep insurance knowledge

• Successful London Market platform with broad customer base

• Both business processing and modern insurance software

Move beyond London Markets to General Insurance in key geographies

Indicates Insurance Delivery Centre locations * based on average monthly numbers, 2012

Japan

• Tokyo

Spain

•Madrid

© 2014 Xchanging plc

GLOBAL INSURANCE STRUCTURE

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Adrian Guttridge

Executive Director

Insurance Services

GO-TO-MARKET

David Brooks

Global Director

Julie Lynch

Marketing & Relations

Director

Jenna Richardson

Head of Insurance

USA

Steve Reid Operations BPO

General

LINES OF BUSINESS

Nick Lamb

MD XBS

Max Pell

MD XIS & XCS

Paul Bermingham

Claims Director

Diego Ascani

Head of Insurance

Australia

DELIVERY

John Niblett

CIO

Beverly Stone

UK Insurance

Operations Director

Manoj KP

Head of Insurance

India

SUPPORT

SERVICES

Paul Carson

Finance Director

Lindsay Healy

Director of Strategy &

General Legal

Counsel

Jenny Coe

HR Director

© 2014 Xchanging plc

INSURANCE SERVICES – THE ‘XCHANGING’ ADVANTAGE

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We Are

2500+ FTE in Insurances Sector

300+ Insurance Customers

10+ years of experience in Insurance Industry

Processed over 1.2 million premium transactions , notified nearly 950,000 claim advices in 2013

Over 32 million messages passed through Xchanging Messaging Hub services during 2013 including 6 million

ACORD messages.

Over 35 million market documents are stored in our Document Repository

More than half a billion IMR page hits annually

We serve public sector insurance customers – Victoria and New South Wales by managing their end to end

workers compensation administration

Complex Processing

“Big Ticket” processing

“Syndicated” processing

High

Volume

1.29m Insurer/broker transactions per

annum

850,00 claims files managed per annum

High Value

Settling $81 billion premiums and claims

per annum

Central settlement efficiencies net down to

$13bn per annum

Trusted Best of breed technology partnerships

IBM, Oracle, Autonomy, Pegasystems,

Adobe, Watertrace, LSG and more

© 2014 Xchanging plc

Policy*

INSURANCE OFFERINGS

11/07/2014 8

Data Capture

Service

(DCS)

Verometrix

Volume Claims

Service

(VCS)

Claims

Utility

Document Repository

Messaging Hub

Central settlement

Market Infrastructure

Electronic Claims File

eAccounts

Workers Compensation*

Claims*

Broking* Policy*

Insurance

Companies 64

Lloyd’s

Syndicates 87

We operate at the heart of London Market and some of our customers are…

Insurance

Brokers 170

Elective BPS Wrapper*

Technology*

Binder 360

Services

© 2014 Xchanging plc 9

Inter-connected benefit case across Operations, Risk,

Finance and Treasury

80%

Capital

Efficiency

Operational

Efficiency

Transparency & Control

50% 0

Unmatched

Cash or Ledger

items

© 2014 Xchanging plc 10

SUCCESSFUL IMPLEMENTATION WITH RSA

• 5 FTES reduced to

1

• 47 process steps

reduced to 26

50%

• With just 2

entities!

• 100s of

transactions

netted down to

just 5 currency

movements

each week

• Unmatched cash

entries & unpaid

ledger entries

• 6 week monthly

closing cycle

reduced to 2

weeks

80% 0%

Capital

Efficiency

Operational

Efficiency

Transparency

& Control

© 2014 Xchanging plc

ENABLING SUCCESSFUL MARKET ADOPTION

Creating the right environment for adoption

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1. EVOLUTION NOT REVOLUTION… Using Market proven technology

6. HISTORY OF PARTNERSHIP… Through experience and

successful delivery

5. COMPELLING COMMERCIAL

PROPOSITION… With low upfront investment and risk

3. DOCUMENT COLLABORATION… Enhancing effectiveness of

interactions

2. MAXIMISES CURRENT IT INVESTMENTS… Through choice and flexibility

4. OPTIMAL BLEND OF PEOPLE,

PROCESS & TECHNOLOGY… To deliver business outcomes

© 2014 Xchanging plc

BROKER MMT

ASSEMBLING OUR PLACING UTILITY

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GLOBAL BROKER GLOBAL CARRIER

MARKET DIRECTORY

OTHER GLOBAL

PLACING

PLATFORMS

OTHER GLOBAL

PLACING

PLATFORMS

CARRIER MMT

BROKER SYSTEM CARRIER SYSTEM

XCHANGING ACORD GATEWAY

COMMON CORE RECORD

IMR

DATA CAPTURE SERVICE

BUSINESS PROCESSING SERVICES

OFF PLATFORM

MESSAGE

OFF PLATFORM

MESSAGE

© 2014 Xchanging plc

BENEFITS TO BROKERS BENEFITS TO CARRIERS

ADDING VALUE FOR BROKERS AND CARRIERS

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Maximises current investment

Reduces effort and errors in data

Minimises the risk of dispute

Minimises burden of administration

Enables cost effective sourcing

Improved access to London

Maximises current investment

Easy to use Carrier UI

Minimises the risk of dispute

Minimises burden of administration

More business placed in London

Enables global operations

© 2014 Xchanging plc

Claims Agreement

X-presso Lite Broker Lounge

We have delivered:

• Claims Viewer • IMR4Brokers • Configurable industry newsfeed • Access to X-presso wifi

What’s on the platform:…

Mobile CAS

The Hub for Insurance Professionals.

Content. Community. Connectivity

14

© 2014 Xchanging plc

Mobile CAS • Go Live in March ’14

• Log in with ECF credentials

• Agree, query & decline claims on the move

15

© 2014 Xchanging plc 16

© 2014 Xchanging plc

PRIVATE AND PRIVATE AND CONFIDENTIAL © Xchanging 2012. No part of this document may be circulated, quoted or reproduced without prior

approval of Xchanging. Subject to contract. 17

Carriers: Brokers:

• Understand availability

• Underwriters and Claims Adjusters

• Dynamically control queuing

• Book forward appointments

• Advertise availability

• Increase prominence

• Analyse activity

Single platform

17

© 2014 Xchanging plc

SO LET’S GO BACK TO THE GLOBAL UTILITY

You could be forgiven for thinking that we want to own the ranch…

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…but we don’t see the world like that, and it would not be good for customer choice

Global

Carrier

Global

Broker

Broker Services

Best of Breed Platforms

Xuber for Brokers

Carrier Services

Best of Breed Platforms

Xuber for (Re)Insurers

Xuber for Brokers Xuber for (Re)Insurers

© 2014 Xchanging plc

YOU CAN THINK OF OUR VISION LIKE THIS…

An ecosystem of suppliers with a single utility platform at the core

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“The utility platform”

“The elective services”

© 2014 Xchanging plc

…OR THIS

Still the same concept 35 years on

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“The utility platform”

“The elective services”

© 2014 Xchanging plc

WHAT DOES GLOBAL AND LONDON CONVERGENCE MEAN?

21

A Common Utility Framework that serves both London & Global

Global

For

Global

London

For

London

Global

For

London

A Framework that we’ve been evolving & bringing to life for some time now

XCHANGING

CLAIMS Paul Bermingham

Executive Director of Claims

© 2014 Xchanging plc

THE LONDON MARKET BUREAU - CLAIMS PROCESSING

Xchanging Claims Services was formed in

November 2001 as an enterprise Partnership

between Xchanging and Lloyds of London.

XCS Consists of approx. 380 staff, 320 located in

Chatham and London and 60 processing in our

centres in India

Key services provided to Lloyd’s market include:-

Claims management service

Claims agreement & processing

Claims settlement

SLAs agreed with the market.

Xchanging Claims Services (XCS)

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XCS

Claims Management &

Adjusting for Lloyd’s

Enterprise Partners

…. providing products & services into London & international insurance markets

© 2014 Xchanging plc

PAPER TO ELECTRONIC - DELIVERING SERVICE

IMPROVEMENT

2001 2012

Two Jumbo Jets worth of paper delivering

annually to on-shore processing centres

95% transmitted electronically to on-shore and

off-shore locations

Localised processing Lloyd’s Chatham,

Company Folkestone

International processing multi-skilling processing

all types all locations

‘It’s in the bureau!’ brokers lament Any submission can be tracked electronically

through the process, new transparency on

broker performance

Paper submissions used once Electronic submissions re-used and for other

purposes e.g. final slips available to carriers

100% paper policies 90% electronic better service to end clients

Processing day limited 8am - 6pm 18 hours of processing per day

100% Paper claims files 75% of in scope Lloyd’s claims electronic –

transformation of carrier & broker claims

operations. Faster end to end process

Broker queries managed on paper Broker queries- Tracker & email not lost, tracked,

recorded builds virtuous improvement circle

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Backed up by a more secure, safer processing environment

© 2014 Xchanging plc

CLAIMS IS CHANGING

2010 •Single Location

•Product Monopoly

•London Market Focus

•London Market Software

•Cost Plus Model

•Rigid Business Model

•197 FTE

2013 •Single Location

•Product Monopoly & Elective

•London Market Focus

•London Market Software & Developing Xuber

•£Cost+ & Elective Revenue = £25m

•Flexible Business Model

•180 FTE

2017 •Multiple Locations

•Elective Services

•Global Insurance Markets

•Xuber Based

•MI Capabilities

•£37m Revenue

•Agile Business Model

•200+ FTEs

11/07/2013 25

Xchanging

Experienced and skilled people

Process capability

Access to great

technology

© 2014 Xchanging plc

WHAT IS THE GLOBAL CLAIMS MARKET?

11/07/2014 PRESENTATION INFORMATION IN FOOTER

Highly Technical, expert driven Adjusting & Consulting

10-15% of portfolio

80-90% value

High margin (25%+)

Medium – Low complexity Blend of expert & process

80-90% of portfolio 10-15% value

Medium margin (15%)

Low Complexity High volumes

Process/ automation driven Support function for above

Medium margin (15%)

COMPLEX

TPA

BPO

26

© 2014 Xchanging plc 27

WHAT IS THE GLOBAL CLAIMS MARKET? WHAT IS THE GLOBAL CLAIMS MARKET?

11/07/2014 27 27

Lloyd’s

London Market

Global Speciality Market

General Insurance (Corp)

Corporate/ Captive (Complex role)

Binders/ DUA

Corporate/ Captive (volume role)

General Insurance (SME/ P/Lines)

Affinity

Support of above

General Insurance (back office)

Affinity (volume – travel, mobile phone, credit card etc.)

COMPLEX

TPA

BPO

Market share of GWP by territory

US UK AUS Other

50% 20% 5% 25%

© 2014 Xchanging plc

WHAT ARE THE AVAILABLE MARKETS TO GROW?

PRESENTATION INFORMATION IN FOOTER 28 11/0

7/20

14

Lloyd’s London Companies MGA / TPA Global

Specialty Corporate & Captive

General Insurance

Life & Pensions / Personal

Lines

Llo

yds CAF, TP &

Elective Contracts

Direct Sales coverage

No Clarify activity

Lon

do

n C

om

pan

ies 40% Dual

Stamp

Direct Sales

Similar profile to Lloyds market

No Clarify activity

MG

A /

TP

A

Brokers uniting books of business

Investment firms acquiring multiple MGA’s

Target for BPS & outsourced Back Office

Glo

bal

Sp

ecia

lty Tier 1’s –

divisions of RSA, Zurich etc.

Tier 2 – specialist national firms across Europe

Xchanging will have recognised skills

Co

rpo

rate

& C

apti

ve

Major corporates and Captive self insured (Shell etc.)

Primary target high end claims

Secondary target, lower end (volume) claims via partnership or acquisition

Gen

eral

Insu

ran

ce

Target Top 20 GI accounts only

Large scale BPS opportunities are of interest to Xchanging

Product opportunities unlikely

Life

& P

ensi

on

s No proactive targeting

Await outcome of two strategic opportunities

DIRECT SALES CLARIFY PARTNERSHIPS / ACQUISITIONS

CURRENT PORTFOLIO SYNERGY LIMITED SYNERGY (today)

© 2014 Xchanging plc

PRODUCTS

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Binder 360

(Claims)

Recoveries

Delegated

Authority

Market Co-

ordination

Fees

Recoveries

Delegated

lead

XRM

Express

Bordereau &

Tracker

Loss Funds

Market Co-

ordination

Services

Broker Fees

Scheme

Canada

Salvage

Delegated 2nd

lead

Political Risks

and Political

Violence

RI Prop

RI Liab

Verometrix

Global Claims

Services

Aviation PFL

VCS

Other Peer Review

and Audit

Static Claims

Company

Statics

Consultancy

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GO TO MARKET

OFFERINGS David Brooks

Global Sales and Marketing Director

© 2014 Xchanging plc

STRATEGIC SALES OBJECTIVES

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Hunting Farming

Process / Governance

Sales Culture Marketing

Growth Objectives

© 2014 Xchanging plc

GTM TEAM - INSURANCE

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Dave Brooks Global GTM Dir

Sales Relations & Comms Business Solutions

Policy Admin

Claims

Broking Services

Data & Analytics

Key Accts

North America

Australia

SE Asia

Product Design

Go to Mkt

Solutioning

Bid Management

Market Relations

PR

Channel

Marketing Liaison

On

e X

ch

an

gin

g

© 2014 Xchanging plc

GLOBAL STRATEGY

EMEA

– Focus on UK

– Reduce dependency on London

– Acquisition to move into Personal Lines BPO (Motor, House, Travel…)

– Grow Channel introductions

– Significant ramp-up in direct sales team

Australia

– Protect & Grow Worker’s Compensation BPO

– Diversify business

SE Asia

– Establish a Beachhead

North America

– Acquisition to springboard traction

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© 2014 Xchanging plc

CURRENT AREAS OF CLIENT INTEREST

Netsett (Net Settlement & Accounting)

e-Placing

Claims Services

Policy Administration

Binder 360

Apps Management Services

Entry to Lloyd’s Consulting Services

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SaaS

THANK YOU