An Introduction to ELTO Richard Potts Date: 6 February 2019 www. mib .org.uk
Outline for the presentation; 1. Origin and Purpose of ELTO 2. What have been the results so far? 3. What it is ERN? Why is it important? 4. Additional Tracing and Declaring 5. Compliance, data accuracy and auditing 6. Your contribution 7. Questions? www. mib .org.uk
Origin of ELTO – MIB and its Mission www. mib .org.uk
How big is the problem of uninsured driving? The cost and impact of uninsured driving £400million • Total cost of uninsured motoring: 39 million • Total UK vehicles: 1 million • Number of uninsured vehicles: £30 per year • Average cost per honest motorist: 29,000 • People injured each year: 120 • People killed each year: www. mib .org.uk
How big is the problem of uninsured driving? Reducing the levels of uninsured driving; • Introduction of CIE – Continuous Insurance Enforcement • ‘Enforcement from the Record’ • By comparing the MID - Motor Insurance Database – with the DVLA database we can identify vehicles not insured – whether on the road or not • It was based upon this MID model that the ELD was born www. mib .org.uk
Origin of ELTO – MIB Structure www. mib .org.uk
Purpose of ELTO Introduced in April 2011 by the industry to • improve the tracing of EL insurance policies using a central database (ELD) Exists to help find the insurer of their • former employer where the claimant is suffering from a long-tailed disease / injury caused at work Replaces the voluntary Employers' • Liability Code of Practice (ELCOP) introduced in 1999 Membership is currently voluntary – over • 160 insurers have joined, representing more than 99% of the market www. mib .org.uk
ELTO – Main Principles and Results • FCA Regulations introduced Feb 2011, compelling insurers to publish within three months: • new and renewed EL policies from 1 April 2011; • also Historic policies prior to 1 April 2011 on which a claim has been made • ELD went live with in April 2011 • In excess of 22 million records on the ELD of which over 8.5m are voluntary • Almost 5,500 Registered users making enquiries with a >92% success rate www. mib .org.uk
What is an ERN? Why is it important? • Each organisation operating a Pay As You Earn (PAYE) scheme is allocated an ERN by HMRC • This is a unique reference number for their employees’ income tax and national insurance contributions • Also commonly referred to as their ‘Employer PAYE reference’ • When paying their income tax and national insurance contributions to HMRC this forms part of their login to the HMRC web site Why is it important? • It is used as a unique identifier for a company in a similar way to the VRM for a motor policy • In tracing historic employers many people will have saved their P60 which shows the ERN www. mib .org.uk
Format of the ERN – from 2001 onwards • NNN/AAnnnnn • NNN = three-digit code for the tax office catchment area the employer is based in • HMRC tax office numbers are from 001-999 • AA= two letters and; • nnnnn= five numbers making up the unique reference for the employer • Large companies may have more than one ERN if they operate different schemes for their employees i.e. more than one Pension Scheme • ELTO report monthly on ‘ERN Referrals’ www. mib .org.uk
What is NOT an ERN? Linking with HMRC Pilot exercise linking with HMRC ERN provided – is it correct? No ERN – can we populate? Marked as exempt – is this correct? www. mib .org.uk
Compliance Annual Data Assurance Audit • FCA requirement • Independently audited • Comparison of the ELD against your core system data • 99% required for accuracy of data comparison • Based on the audit report a senior director must send to the FCA a Directors’ Certificate which declares the company as being ‘Materially Compliant’ or not www. mib .org.uk
Compliance Annual Tracing Audit • FCA requirement for insurers to trace against Historic records • Around 400-600 enquiries each week • 28 days to search records and respond • All tracing enquiries to be ‘declared’ against with 28 days permitted • ELTO requirement to be audited against the Tracing Policy • All audit scores are provided to the FCA and all Red audits (those scoring 60% or less) are automatically referred to the FCA www. mib .org.uk
Your contribution • Helping insurers be more timely in their submissions • Accuracy and Data quality • Getting the message out… Broker Guide o Tips for o intermediaries Employers Guide o www. mib .org.uk
In Summary 1. ELD is one of a number of databases managed by MIB 2. Reports are provided monthly to assist you in Time To Supply, ERN capture, data quality and tracing 3. These are to assist you in your compliance with industry and regulatory requirements including auditing 4. Understanding these yourself and making your customers aware will make compliance easier www. mib .org.uk
Any Questions ? www. mib .org.uk
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