Thursday, 10 November 2011
Ferma makes formal approach for single database on global programmes
Ferma, Airmic and the London and International Insurance Brokers’ Association (LIIBA) will formally approach the insurance market this month with a request to set up a single global insurance regulation and tax database to help solve some of the compliance issues on multinational programmes.
Julia Graham, joint Vice President of Ferma and Chief Risk Officer at multinational law firm DLA Piper
Whilst there is no concrete timetable for implementation of the database, Ferma and its partners will gauge the response from the insurance industry over the coming months and hopefully begin building it in the second half of 2012.
Ferma said the discussions and any subsequent database will focus on input from London market insurers due to the relatively small group of providers currently involved in discussions.
The announcement follows several meetings between risk management representatives and insurers interested in contributing to a single database over the last six months.
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It was a hot topic at the recent Ferma Forum in Stockholm during which some insurers were less than positive about a joined up effort.
Ferma and its partners have called for a single database on tax and compliance issues to avoid the inconsistent interpretations of laws and regulations supplied by insurers around the world.
The database will attempt to pool all of the various interpretations and information in a consistent manner to provide a market standard by which everyone can abide.
Some insurers remain sceptical about the proposal, in part because they feel the quality of their own database differentiates them from their competitors.
Former Ferma president Peter den Dekker, who has been one of the champions of the scheme, has vowed not to rest until the database is realised.
Julia Graham, joint Vice President of Ferma and Chief Risk Officer at multinational law firm DLA Piper, is upbeat about the progress made and the benefits the scheme will bring.
“We are quite positive that the work we are doing with Airmic will produce useful results for other Ferma members,” said Ms Graham.
She explained that concentrating on London makes the project more practical in a short timeframe than aiming for global participation.
She believes that because so many London market insurers are part of big international companies and London is involved in so many global programmes, the data that they can provide will cover many jurisdictions, enough to be valuable for corporate insurance buyers everywhere.
Ferma and Airmic are also hopeful that as they progress, the US Risk and Insurance Management Society (RIMS) will become part of the project.
Compliance on multinational programmes is a huge issue for risk managers, explained expert Helen Hayden, Group Insurance Risk Manager of Prudential.
According to Ms Hayden regulatory authorities are increasingly monitoring large international businesses following the credit crunch and economic downturn and are prepared to take action against offenders, including levying financial penalties for non-compliance.
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