The complexity of validation
So far so good….
There are new data standards, a few new data points to collect and a contract standard MRC v3. The one missing capability is that of validation. How do you know if your CDR is compliant?
How do you know if you have the right set of data to fulfil the CDR whether data-first or document-led?
A reminder: In v3 of the CDR, there are 112 conditional mandatory fields.
With this number of conditional mandatory fields, there are circa 750 different rules and permutations of the data. Conditional fields are also dependent upon each other in some instances. For example, if the territory of the risk is Spain, then it requires the Spanish tax information. If during the placement process Germany is added, then similarly it requires the German tax information.
This is an important point because the CDR compliance cannot be validated in a linear way, as much data as possible/ known needs to be present to validate.
Additionally, it is essential to understand why and how the data is not valid during the validation process in order for the data to be corrected. This is especially pertinent because some data is mandatory for Lloyd’s and yet not for the Company market therefore it’s key to know which markets will be supporting the risk. So, the CDR needs to be ready whosoever supports it.
Each organisation will therefore need access to a validation process and ruleset to ensure compliance. Some of this validation will be performed by the gateway on a ‘soft-call’ basis. This will be available at some point during 2023/24.
r10 is close to completing a CDR validation solution with our partners for those that are data-first, document-led or anywhere in between that will cater for the three document types: MRC v3, SoVs and tax schedules or a singular data feed.
For documents, data will be extracted, validated and compliance results returned with appropriate reasons for non-compliance.
For data-first, the same validation and compliance process.
This is especially useful for Brokers looking to update their document and understanding the data delta between the MRC and MRC v3 as well as ongoing compliance.
Get in touch with r10’s Advisory team to help you comprehend further CDR, and your Future@Lloyd’s digital transformation journey, including understanding, defining and implementing your strategic priorities – including a tailored data strategy, right sizing technology, IT and process change management.