Monday, January 27, 2025
Home Authors Posts by Barbara karouski

Barbara karouski

Profile photo of Barbara karouski
1629 POSTS 0 COMMENTS

0 9

UK boardrooms are making clear progress on diversity and the use of external evaluation but need to do more on disclosing their approach to succession planning according to the ABI’s report on Board Effectiveness recently published.

The ABI’s 2012 report on Board Effectiveness sets out progress and highlights best practice in diversity, succession planning and the use of external evaluation, one year on from its first report on board effectiveness. It also includes a review of the role of the chairman.

Based on ABI analysis of FTSE 350 annual reports, key findings show that:

– Board diversity is improving: 26% of FTSE 100 and 31% of FTSE 250 board appointments were women, in the year to 30th November 2012, compared to 19% and 12% respectively in the last report. On succession planning, 80% of FTSE 100 and 50% of FTSE 250 chief executive officers appointed in the year to September 2012 were internal appointments.

– Based on a survey of FTSE 350 company secretaries, the use of external evaluation of board effectiveness is increasing: 44% of FTSE 100 and 30% of FTSE 250 companies conducted external evaluation. This is up from 31% and 17% respectively in the previous year.

The main recommendations in the report to improve shareholder engagement on these important issues are:

– Companies should disclose steps they are taking to promote boardroom diversity.

– Companies need to show more meaningful disclosures on their approach to succession planning

– External board evaluations should be carried out by an independent party with no conflict of interest

The report also explores the role of the chairman. Based on interviews with a selection of FTSE 350 chairman, there was consensus on the key components of the Chairman’s role in:

– Creating the right board dynamic and composition, setting the agenda, managing the board’s relationship with the executives and acting as an ambassador for the company.

It was also agreed that Chairmen should outline in the annual report their role in creating an effective board and how it has been set up to respond to any challenges the company faces.

Commenting on the report at the ABI’s Investment Conference today, ABI Director General Otto Thoresen said: “In a year dominated by a focus on executive pay, it is important to remember that companies do not fail because their pay structure is wrong, but because of ineffective boards and failures of strategy development and execution. Our report provides a comprehensive analysis of what makes an effective board, drawing out examples of where progress has been made, such as board diversity, and where improvements are needed. It aims to provide guidance to help companies engage more effectively with their shareholders.”

Richard Reid, Chairman of KPMG in London, which is partnering with the ABI at today’s Investment Conference said: “Getting the dynamics of a board right and ensuring that it plays an effective role in supporting the success of the organisation is not limited to pursuing and recruiting a ‘dream team’ of board members. It is to ensure that the maximum value is derived from the wealth of talent that the board represents, and to achieve a unitary sense of purpose.

“The board has to set the tone at the top, the ethos and support the CEO to leading the organisation, drive and promote its ambitions, cultures, values and behaviours, as well as take a leading role to protect it from risk and safeguard and promote the interests of shareholders and long-term success of the company.”

0 27

US doctors say they have saved a seven-year-old girl who was close to dying from leukemia with a pioneering use of an unlikely ally: a modified form of the HIV virus. 

After fighting her disease with chemotherapy for almost two years and suffering two relapses, the young girl “faced grim prospects,” doctors at Children’s Hospital of Philadelphia said.

So in February this year they agreed to take her on in an experimental program that fought fire with fire. Helped by a genetically altered HIV virus — stripped of its devastating properties that cause AIDS — doctors turned the girl’s own immune cells into a superior force able to rout the “aggressive” leukemia.

The treatment of Emily Whitehead was one of the very first of its kind and cannot yet be considered “a magic bullet,” the hospital said. But in Emily’s case, it apparently worked completely.

First, millions of the girl’s natural immune system cells were removed. Then the modified HIV virus was used to carry in a new gene that would boost the immune cells and help them spot, then attack cancer cells that had previously been able to sneak in “under the radar,” the hospital said on its website.

Finally the rebooted immune cells were sent back in to do their work. “The researchers have created a guided missile that locks in on and kills B cells, thereby attacking B-cell leukemia,” the hospital said.

Pediatric oncologist Stephan Grupp, who cared for the girl, explained Tuesday that there was never any danger of AIDS during the process. “The way we get the new gene into the T cells (immune cells) is by using a virus. This virus was developed from the HIV virus, however all of the parts of the HIV virus that can cause disease are removed,” he said in an email.

“It is impossible to catch HIV or any other infection. What’s left is the property of the HIV virus that allows it to put new genes into cells.”

During the treatment, Emily became very ill and went into the intensive care unit, underlining how risky the procedure can be. However, drugs that partly block the immune reaction were administered, without interfering with the anti-leukemia action, and she recovered, the hospital said.

The result was “complete” and best of all, the doctors say, the boosted immune shield continues “to remain in the patient’s body to protect against a recurrence of the cancer.”

“She has no leukemia in her body for any test that we can do — even the most sensitive tests,” Grupp told ABC television.

“We need to see that the remission goes on for a couple of years before we think about whether she is cured or not. It is too soon to say.”

Grupp said on the Children’s Hospital of Philadelphia website that cell therapies might eventually replace the more costly, painful bone marrow transplant treatment, a standard last-ditch defense against cancer.

“I’ve been meeting with families to discuss bone marrow transplant for 20 years,” he said. “In almost every meeting, I say that bone marrow transplant is very hard and that if we had an alternative for children at that point in treatment, I would be delighted to put myself out of business. And for the first time, we’re seeing how that might actually happen.”

New York, Dec 11, 2012 (AFP) 

0 0

American insurance company AIG said Sunday it will sell up to 90 per cent of its plane leasing firm ILFC to a group of Chinese investors, in a deal that values ILFC at $5.28 billion. 

The purchasing investor group is made up of New China Trust Co. Ltd, China Aviation Industrial Fund and P3 Investments Ltd. They will acquire 80 per cent of International Lease Finance Corporation for about $4.23 billion, with an option to acquire an additional 9.9 per cent.

When the transaction is completed, expected by mid-2013, AIG’s 10 per cent stake will allow “it to continue to participate in the growth of ILFC’s unique franchise, including the benefits that the investor group will bring to the company,” the insurance company said in a statement.

“This transaction creates a solid and strategic partnership for ILFC,” said AIG chief Robert Benmosche, in the statement.

“While ILFC is an extremely strong business platform and AIG will retain a minority stake as a passive investor, the aircraft leasing business is not core to our insurance operations,” he said, adding that the sale will benefit AIG’s bottom line.

It will have “a positive impact on AIG’s liquidity and credit profile and will enable us to continue to focus on our core insurance businesses,” he said.

New York, Dec 9, 2012 (AFP) 

0 0

According to catastrophe modeling firm AIR Worldwide, a magnitude 7.3 earthquake struck off the northeast coast of Japan on December 7 2012, 270 kilometers from the Japanese city of Sendai, at 18:18:24 local time. The event struck in the same plate boundary region impacted by last year’s devastating M 9.0 Tohoku earthquake, although that quake’s epicenter was about 150 kilometers closer to mainland Japan.

According to AIR, given the distance of this event from shore, only minimal non-structural damage is expected, and insured losses are not expected to be significant.

Today’s earthquake shook buildings as far away as Tokyo and prompted the Japan Meteorological Agency (JMA) to issue tsunami warnings for a large part of the northeast, including Miyagi Prefecture, which suffered significant tsunami damage following the Tohoku quake. Thousands of people in at-risk regions evacuated to higher ground. Though tsunami waves as high as one meter did impact the coastal city of Ishinomaki, tsunami warnings were lifted shortly after—indeed, about two hours after the quake struck. (Tsunami warning heights for today’s event had varied between 50 centimeters and two meters, compared to 11 meters for the Tohoku temblor.) Thus far, it is not clear if the waves in Ishinomaki—where vast areas still remain in disarray following the Tohoku event last year—caused any damage.

“Today’s earthquake was also closely followed by at least six aftershocks, the strongest of which was a M6.2 temblor,” said Dr. Tao Lai, principal engineer at AIR Worldwide. “The damage picture from today’s earthquake is still taking shape, but so far there have been no reports of serious damage or injury. During the event, strong shaking was felt in a wide swath of northeastern Japan, extending to Tokyo, where office buildings swayed.”

Although a major concern following the Tohoku event was the crippled Fukushima Daiichi Nuclear Power Station, the plant’s operators, Tokyo Electric Power, reported that the station (located in Fukushima Prefecture, directly south of Miyagi Prefecture) was untouched by today’s event—although workers did  move to higher ground at the time of the tsunami warning.

According to AIR, today’s event struck 270 kilometers east of Sendai, Japan, and about 150 kilometers east of the epicenter of the M 9.0 Tohuku earthquake in 2011. It occurred along the Japan Trench where the Pacific Plate subducts under Japan’s Honshu Island, and is associated with the ongoing and rapid (nearly 100mm/year) westward subduction of this plate beneath Japan.

Dr. Lai commented, “The Japan Trench is one of the most seismically active subduction systems on earth. On average, more than one earthquake of magnitude 7 occurs in this 800-km long subduction zone every decade. In the last four decades alone, 12 events of M7 or larger have occurred within 250 km of today’s event. Other large historic earthquakes to have occurred here include a M8.5 event in 1896, a M8.1 event in 1933, and a M7.5 earthquake in 1915.”

“Today’s earthquake—which occurred along the subducting slab of the Japan Trench interface—is likely associated with stresses due to the “bending or unbending” of the  crust in this tectonic region and/or evolving stresses due to the earlier Tohoku event. Today’s event is also possibly associated with normal or reverse faults in the lower to middle crust, as the direction of earthquake-related plate movements reveal. The nature of today’s earthquake is rather unusual since so-called “bending or unbending” events are rarely observed in subduction zone areas.”

According to AIR, earthquake insurance penetration in Japan is relatively low (ranging between 14 to 17 per cent nationwide). About 70% of all residential construction is estimated to be of wood and about 25% of concrete. Commercial construction consists of more than 50% concrete, about one-third light metal or steel, and less than 10% wood. Residential structures in the region of Japan impacted by today’s quake are generally resistant to earthquake shaking. Some vulnerable structures do exist; they are comprised of non-ductile reinforced concrete frame and heavy wood-frame construction.

0 2

Allianz Global Corporate & Specialty (AGCS) has appointed Simon Buxton as its new Global Head of Reinsurance with effect from January 1, 2013, based in London. Buxton moves from Allianz Risk Transfer (ART) to succeed Henning Haagen who takes on his new role of Global Head of Aviation EMEA/Asia Pacific for AGCS.  Haagen will remain in his current role until January 1, 2013, to support a coordinated transition and to ensure continuity in service to clients, brokers and reinsurers.

Buxton has over 15 years of experience in the reinsurance industry and joined ART in 2008 as Head of Reinsurance Solutions.  In this role he successfully developed a structured reinsurance strategy and introduced a portfolio with products and markets that were new to ART, working closely on a number of projects with AGCS. Before joining ART he worked in the insurance industry in a range of consulting and underwriting positions in Bermuda, Argentina and the UK, including senior positions for XL Financial Solutions, Bermuda and at Towers Watson, London.

Commenting on the appointment and changes, Bill Scaldaferri, CUO Allianz Risk Transfer & Reinsurance and member of the AGCS AG Board, stated: “I’m pleased to congratulate Simon on his appointment and want to thank Henning personally for his tremendous service to AGCS during his tenure as Global Head of Reinsurance. Simon will be a great asset in helping bring new ideas to our reinsurance buying strategies.”

0 0

Commercial insurance underwriting agency, APC, has begun its expansion drive into Continental Europe by launching APC Holland.

Based in The Hague, the independent MGA will provide a range of covers for the Dutch SME market via a network of brokers.  It will also utilise its proven QuoteMac on-line trading platform, a facility that to date has not been widely available in the local market.

Led by Paul Röthengatter, the team plans to become one of the leading MGAs in the local market by both providing access to the Lloyd’s and London markets and delivering a high level of service to its business introducers.

Launched following regulatory approval by the Dutch regulator Autoriteit Financiële Markten (AFM) and Lloyd’s, APC Holland will also be developed as the template for future expansion in Europe.  Although its products have been made available to brokers in the Republic of Ireland from July 2010, APC has been primarily focused on the UK since it was established in 1993.

APC Director, Jon Bates said: “The time is right for APC to launch into the Continental European market.  The combination of our Lloyd’s and London company market underwritten products, QuoteMac and Paul Röthengatter’s in-depth local knowledge will, we believe, enable the business to quickly become established as a key market for SME focused brokers in Holland.

“Using APC Holland as a template, we also intend to drive further penetration in Europe by partnering with local experts.  We have already begun discussions with several potential partners and believe 2013 will be a period of significant growth.”

0 1

Collinson Insurance Group (CIG) is pleased to announce that it has agreed terms to acquire One Assist Limited including the assets of One Claims Limited (the One Group). The deal is subject to a 30 days due diligence review period before completion.

The One Group provides claims management and medical emergency assistance services to the travel and personal accident insurance markets, and directly to multinational corporations.  It has a broad portfolio of clients which include a number of Lloyd’s syndicates and international airline partners.  As part of the deal, Collinson Insurance Group will merge its own claims handling from Columbus Direct and its other insurance brands with the One Group and transfer its existing assistance business into One Group from third-party suppliers.

Paul Byrne, CEO and co-founder of One Group will remain with the business, and will take a new role as director of the acquired division.

David Evans, Managing Director of Collinson Insurance Group said: “One Group is a great business, with a very strong portfolio of clients, including a number of Lloyd’s syndicates and global airline partners.  One Group’s worldwide expertise and multilingual language capabilities will help us to better serve our own international banking and third party clients. This deal gives Collinson group companies access to our own in-house assistance team, and as such helps us to reduce our own third-party costs in our retail businesses, as well as allowing us to manage more directly the quality of claims assistance that we give to our clients.”

Paul Byrne, CEO of One Group said: “It is exciting to be becoming part of the Collinson Insurance Group.  We have built up a great business, with a skilled team in place that has enabled One Group to become a market leader in managing travel claims, and assisting with repatriation for those who fall ill or suffer accidents whilst abroad.  Becoming part of a larger group such as CIG who are already known as a market leader within the travel industry opens up new and exciting opportunities.  We look forward to a new phase of growth and development for our business.”

0 0

The Financial Services Authority (FSA) is consulting on the approach the future Financial Conduct Authority (FCA) would take if it needed to exercise powers to make temporary rule changes, before consultation, relating to financial services products.

The Financial Services Bill specifically includes this power as part of the FCA’s toolkit. The FSA is consulting on its successor body’s behalf so that the FCA’s approach is clear and understood by April 2013 when the new regulator comes into being.

Rules made before consultation would last for no longer than twelve months and could not be renewed. During this time, the FCA will either consult on a permanent remedy or aim to resolve the problem another way.

The consultation outlines some instances which may trigger temporary rules being made, including:

– Where a product is in serious danger of being sold to the wrong customers, for instance where complex or niche products are sold to the mass market;

– Where a non-essential feature of a product seems to be causing serious problems for consumers;

– Where a product is inherently flawed.

Product intervention rules (temporary or not) may address a wide range of product-related issues, for instance by restricting the marketing of a product to only certain types of customer or by requiring a product feature to be removed or changed in some way.  Where there is high risk to consumers, FCA might make a rule change to ban a product but it would only do so in very serious circumstances. Other possible interventions, which would not necessarily require changes to rules, would include issuing warnings, or using supervisory powers to require firms to amend promotional materials.

Martin Wheatley, managing director of the FSA and CEO-designate of the FCA, said: “Making temporary product intervention rules is not something that we expect to do often but having this power means we can act quickly and decisively.

“The use of the power will be a judgement based on the need to protect all market users, consumers and industry innovators alike, from the type of products which will cause harm and might generate compensation costs.”

The consultation runs until 4 February 2013.

0 1

The European Insurance and Occupational Pensions Authority (EIOPA) has today published its Report on the Methodology for Collecting, Analysing and Reporting on Consumer Trends.

This enhanced methodology will be used by EIOPA to produce its annual Consumer Trends report, as part of its tasks under Article 9(1)(a) of EIOPA Regulation, to take a leading role in promoting transparency, simplicity and fairness in the market for consumers.

This report describes the methodology for collecting, analysing and reporting on consumer trends.

EIOPA’s goals in this area are threefold:

– To establish a framework for the collection of consumer trends information from National Supervisory Authorities (NSAs) including:

exploring possible data sources;

checking the availability of the data from these sources; and

considering the level of comparability of the available data;

– To develop a methodology to collect and analyse the consumer trends information; and

– To establish a process for producing a report on the consumer trends identified from the information gathered and analysis conducted.

EIOPA seeks to collect both quantitative and qualitative data where it may be a useful indicator of a consumer trend and where a significant number of Member States have the data available.

The Report on the Methodology for Collecting, Analysing and Reporting on Consumer Trends can be accessed here:

https://eiopa.europa.eu/fileadmin/tx_dam/files/publications/reports/2012-11_Methodology_on_collecting_consumer_trends.pdf

0 0

Responding to the announcement that the government is to invest a further £120 million on flood defences, AA Insurance says that this is welcome news, even if it is too late for many of the 1,600 families that have helplessly seen their homes flooded.

Simon Douglas, director of AA Insurance, says: “It’s hard to imagine a better investment.  The cost of flood claims during 2012 is likely to be around £1bn, quite apart from the economic and infrastructure damage that flooding causes.  It creates utter misery for the families affected.

“This year, 23,000 homes that would have been flooded, have remained dry: at a stroke, that more than repays the investment in the flood defences and alleviation schemes that protected them.  Those families can sleep more easily when the rain starts to pour down, not just because the risk of flooding has been mitigated but that their home insurance will become more affordable too.”

However, Mr Douglas warned that flooding will continue to be a threat to hundreds of thousands of homes, pointing out that water runoff has caused flash floods in places that have no history of flooding, as severe rainstorms become an established pattern of the UK climate.

“It’s vital that the insurance industry is able to continue protecting such homes and that local authorities and water companies ensure that keeping drainage systems clear remains at the top of the local political agenda – and not pushed to the bottom of the in-tray as soon as the next dry spell comes along.”

 

0 26

India, China and Singapore have the highest proportion of consumers wanting to continue working beyond retirement whilst France UK and Italy have the lowest proportion wanting to work beyond  retirement age.

Developed nations in our research are much more pessimistic over their children’s future. The most optimistic countries being China, India, Singapore and Russia.  The most pessimistic outlook for their children’s future in terms of having a better standard of living is held by France

Consumers appear to be in denial over retirement planning with UK and US the most likely to not know how much or have not considered how much income they will need in retirement.

Work looms post-retirement

Aviva’s Consumer Attitudes to Savings survey shows the very wide range of attitudes to financial futures. Three quarters of Indian respondents see themselves as wanting to work after the normal retirement date, whilst two thirds of those in China, Singapore, Turkey and Russia are of a similar view.

At the other extreme just one in four of those in France and one third of those in the UK and Italy see themselves as wanting to work beyond retirement age.  This can perhaps partly be explained by retirement being a relatively new concept in some markets, whilst for others it will be that retirement planning has been a feature for quite some time.

East takes lead in living for today

When it comes to “living for today”, it is countries such as China, India and Russia seem to lead the way in preferring the spend today rather than the save for tomorrow culture.  Perhaps then it is little wonder that these same are planning to carry on working beyond normal retirement age.

West pessimistic over children’s future

And there are some very clear differences of opinion when it comes to consumer attitudes about children’s futures. It is again the East that have a much more positive outlook. When asked “How likely do you think is it that today’s youth will have a better life than their parents?”, nearly all those in China (96%) and India (95%) felt positive.  70% of those in Singapore, and 63% of those in Russia also felt positive about their children’s future.

Clearly much of this is seated in historical and cultural differences with the West, but it may be that this positive attitude is resulting in a much more consumerist society. With economic uncertainty comes a sense of concern for their children’s future and we see very few consumers in Western countries saying that the “youth will have a better life than their parents”. In France only 16% agreed with this statement, Italy (18%), UK (29%), and Spain (30%).

Wide variance for material happiness

There are also some interesting differences between countries when looking at material happiness. There is a very clear sense in many markets that consumers feel they have got all the material things in life that they need.  Whilst not a majority, in each of these countries there are significant proportions saying that they have reached the point of having sufficient material possessions.

In the UK (48%), Spain (46%), USA (45%), and Ireland (44%) many consumers agree they have enough possessions, which could well impact on economic activity as consumers switch  from buying traditional products to spending their money in other ways e.g. experiential activity. However, many developing markets, display the desire for more material possessions. Just 14% of Poles feel that they have reached material happiness, with Russia (22%) Turkey (27%), and Singapore (35%) also showing similar levels of contentment.

Interestingly, Italy stands out as the one European  country surveyed that hasn’t reached material happiness yet with just 26% agreeing that they have enough material possessions. Clearly the Italians haven’t had their fill of Gucci, Dolce and Gabbana, and Armani!

Savings vulnerable to daily living

Despite this materialism there are many consumers who are relying on their savings to live day by day.  58% of those in India agreed that they were relying on their savings, whilst 37% in Italy were also reliant upon their savings.   At the other extreme, Poland had just 14% relying on their savings with similar low figures for UK (17%) and France (18%).

Uncertainty impacts attitude to risk

Across the countries surveyed, seven in ten (70%) agreed that life in general is more risky than it used to be, although China has the lowest “level of concern” with just 55% seeing life in this. This cautious attitude will undoubtedly impact on consumer attitudes to savings and investments and the prospective returns that they can expect to receive.

Consumers focus on debt reduction

With this sense of risk comes the feeling that consumers need to embark on debt reduction.  A significant drag on any economic recovery is both the extent of household debt and the pace at which consumers feel the need to reduce this debt.  Nearly two thirds in Poland (63%) and Singapore (58%) are looking to pay off debt as quickly as possible, whilst just 36% of Italians and 39% in the UK are looking to pay off their debts as quickly as they can.

Consumers in denial over retirement planning

This survey also reveals that many consumers do not know how much income they are going to need to get by or survive in retirement.  Perhaps it is a combination that “it will work itself out”, or the event is too far in the future to worry about it now, or, most concerning, it is just best not to know.  The UK stands out as the country with the greatest proportion of consumers  that either do not know or have not considered how much will be needed.

The US is not in a much better space with a third (34%) not knowing how much they will need.  Ireland, Spain, India and Poland see one in four of their populations don’t know how much they will need to get by or survive on in retirement.

“This survey suggests that whilst many are in search of material happiness, people appear to be choosing not to consider their financial futures and are living in hope that it will all come good”, said Rob Hancock, Aviva’s senior insight manager (global markets).  “It is hardly surprising that the majority of those surveyed across all countries believe that life is becoming more risky than it used to be and that working beyond the normal retirement age is the answer.  There is an important role that insurers like Aviva can play in helping consumers plan their financial futures”.

0 4

Fitch Ratings has affirmed MutRe’s Insurer Financial Strength (IFS) rating at ‘A-‘ with a Stable Outlook.

The affirmation reflects the company’s strong capital position, the financial flexibility provided by its committed shareholder base, its consistent strategy and its solid franchise in the French accident and health reinsurance market. The rating remains constrained by the company’s small size and geographical concentration, modest profitability and its exposure to potential pandemic risks not fully covered by the company’s retrocession program. In addition, Fitch believes that the size of the company makes it more susceptible than larger companies to operational risks and to changes in the external operating environment.

According to Fitch’s own risk-based capital assessment, MutRe’s capitalisation remains strong and commensurate with the rating level. The regulatory Solvency I ratio was stable at 195% at end-2011 (194% in 2010).

MutRe’s net profit declined sharply to EUR0.3m in 2011 due to a loss of EUR6.4m on one particular treaty, which experienced an unexpected level of claims. Consequently, underwriting results deteriorated with a net combined ratio of 106% (105% in 2010). The depressed financial markets resulted in significant impairments and realised losses. However, assets are managed relatively cautiously and invested mainly in high-quality fixed-income assets. Fitch expects MutRe’s profitability to remain relatively resilient despite the current low investment return environment.

Key ratings drivers for a downgrade include a failure to improve profitability (as measured, for example, by the three-year average combined ratio not improving to below 105%) or if MutRe was unable to renew contracts. In addition, the rating could be downgraded if there was a sustained decline of the regulatory solvency ratio to below 170%.

An upgrade of the ratings is unlikely in the medium term, given the financial and business profile of the company, in particular its size and lack of significant diversification.

MutRe is a French reinsurance company with shareholder’s funds of EUR116m and gross written premiums of EUR306m in 2011. Major business lines are health (56%), protection (mostly death and disability, 34%) and dependency products (10%). MutRe predominantly offers proportional reinsurance treaties to more than 50 French primary insurers, mostly mutual organisations. The company currently employs 26 staff.

0 0

Advancements in the IT sector are opening up new applications, but also creating new risks. So-called cyberrisks pose mounting challenges for companies, and corporate risk management needs to consider the threat of losses in turnover and reputational damage.

In 2011, more than 232 million data records containing personal information were stolen or compromised globally, of which about 23 million records related to people in the United States. According to the “Cost of Cyber Crime” study conducted by the Ponemon Institute, stolen data records can cost an average of US$ 200 per person. In Germany, crime statistics compiled by the police indicate that about 60,000 cases of cybercrime were recorded in 2011.

Cyberrisks can take a wide variety of forms. Virus infections, internet fraud, industrial espionage, misuse of personal data (identity theft), copyright infringements or denial-of-service attacks that block targeted sites by overloading them with communication requests – the companies affected may suffer extensive loss either in terms of turnover or as a result of liability claims made by clients or business partners.

Most traditional property and liability policies provide no cover for cyberrisks. That is why there is increasing demand in the corporate sector for insurance solutions that address this new risk situation and especially its inherent potential for loss accumulation. Depending on their design, individual policies may now cover a wide range of first-party and third-party losses. A British market research firm reports that 30% of major US companies have already acquired cover against cyberrisks, as compared to just 5% of the companies in Europe. “Adequate insurance against data abuse should be a standard element of commercial insurance because this is a context in which any company can suffer loss of turnover or image impairment”, states Thomas Blunck, member of the Munich Re Board of Management.

Munich Re recently published a comprehensive brochure on cyberrisks. In addition to illuminating specific aspects such as the issue of liability for Facebook parties or the special legal situation in the USA, the brochure “Cyberrisks: Challenges, strategies and solutions for insurers” offers an overview of the various types of loss and liability. Cyberattacks can burden companies with substantial costs, for example:

– Due to business interruption resulting from the disruption of IT operations or the necessity of conducting a forensic investigation of the causes

– For legal counsel, attorneys and penalties or for defence against lawsuits

– For data and system recovery, notifying the clients affected and repairing reputational damage

– For liability vis-à-vis third parties, an aspect important particularly in the USA, where there is the risk of especially high damages claims (also via class actions).

Munich Re utilises its Group-wide know-how to offer made-to-measure cyberrisk covers. Hartford Steam Boiler (HSB) in the USA offers a Data Compromise programme to help small and mid-sized businesses respond to a data breach. HSB reinsures and manages the programme for other insurance companies, so they can include the cover in their business-owners and commercial package policies. “When a data breach occurs, customers expect prompt notification and assistance. We help businesses to respond to data breaches by covering the cost of client notifications and services for victims of identity theft”, said Eric Cernak, HSB Vice President for Strategic Products.

Insurers face an entirely different challenge in cloud computing, i.e. the shifting of computing capacity, storage, platforms and software to the internet. Here, Microsoft and Munich Re have set up a strategic partnership this year to find common answers to issues involved in commercial cloud computing services.

    0 0

    Standard & Poor’s Ratings Services today published a report discussing its view of the ongoing regulatory changes in the U.K. life insurance market (see “U.K. Life Insurers Face Hard Choices As Low Interest Rates Coincide With Widespread Regulatory Reform”). These require a strategic response from all players, even the market leaders. At the same time, continued macroeconomic uncertainty serves to constrain the margin for error.

    Insurers in the U.K. life sector that are expected to maintain or enhance their credit strength after the regulatory changes will be those with a broad distribution and product base that is not reliant on commission. In addition, those insurers that have access to the market via a number of routes or whose customers have already made the cultural transition to paying for advice will likely gain most from the changes under the Retail Distribution Review. The insurers that can extract value from auto-enrolment will be those that are able to retain and select schemes without weakening their profitability and those that can exploit the opportunity to sell a broader suite of benefits. Overall, a dip in new life sales appears likely over 2013 and 2014 as the market readjusts.

    Across the industry, capitalization remains robust and has benefitted from significant reductions in risk. Furthermore, S&P considers the balance sheets of the U.K. life sector to be liquid. Most liabilities to which shareholders are exposed are long-dated, and illiquid. These liabilities are, in general, matched with highly liquid and highly rated bonds.

    0 1

    Swiss reinsurance group Swiss Re has estimated that it will have to pay around 900 million dollars (695 million euros) in claims stemming from damage done by Hurricane Sandy to the east coast of the United States, it said on Monday. 

    Swiss Re said that total insured losses from the storm were estimated at between 20-25 billion euros.

    The group, which provides insurance for insurance companies, warned that its own exposure of 900 million dollars “is subject to a higher than usual degree of uncertainty and may need to be subsequently adjusted.”

    Sandy slammed into a densely populated part of the US, resulting in “prolonged power outages, disruption to public transport and damage to other infrastructure that have made recovery efforts very difficult,” a statement noted.

    “It also complicates the loss assessment process,” Swiss Re said.  Chief executive officer Michel Lies was quoted as saying that “Swiss Re will support our clients and partners in tackling this challenging situation, as we have done in so many instances in the past.”

    The so-called superstorm killed more than 110 people in the US and Canada.

    Paris, Nov 26, 2012 (AFP) 

    0 0

    Electrical Contractors’ Insurance Company Ltd (ECIC) has launched a Contractors Health and Safety Training Course for key partner brokers which will be run in conjunction with Marc Brocklesby, Risk Management Consultant at OHS Ltd. The aim of the training is to enable attendees to recognise client compliance risk and determine if their Health and Safety management systems reflect good practice.

    Marc has over 12 years consultancy experience and an understanding of loss prevention and underwriting having worked within the insurance industry for Norwich Union, Sterling and Holman’s. He is a member of the Institution of Occupational Safety and Health (IOSH) and Institute of Fire Safety Managers (IFSM).  In addition, Marc holds formally recognised qualifications in the management of asbestos and legionella.

    Sharon Miller, Sales Manager, at ECIC said: “Health and Safety is vital in our industry and it is something that should be reviewed regularly. The point of this course is to help our brokers  stay up-to-date with the relevant legislation and also to review with them the risk assessment and management aspects of the Health and Safety legislation.”

    The course will also include an overview on:

    – Compliance software and management tools

    – Water management

    – Asbestos Management (CAR 2012)

    – The Fire Safety Order 2005

    The Contractors Health and Safety Training course will be held on the 29th November at the ECIC Sevenoaks building. Delegates participating in the training will receive a certificate acknowledging the training and can claim 4 hours of CPD towards the CII and ABI member CPD schemes.

    0 0

    Access to data is ‘make or break’ for many insurers today, and faster speeds for rating changes the priority for those responsible for distribution.

    These were the conclusions of BGL’s insurer partners at its recent conference. Twenty two insurers shared their views on the most pressing distribution issues in today’s personal lines market at the event, held at the Four Seasons Hotel in London.

    The agenda included updates from BGL Group on its own progress in core distribution areas, such as Counter-Fraud and Technology, as well as insight into the Group’s business strategy. The day then focused on insurers’ own challenges and priorities in working with intermediaries. Data was seen as a key differentiator – with insurers seeking greater insight into vehicles, customers, fraud and general market intelligence.

    Michael Lawrence, Personal Lines Director at LV= Broker, said: “There are many areas where intermediaries continue to add value for insurers, and the conference gave us a strong insight into what BGL can deliver for us. It’s unusual to have such an open forum to discuss distribution challenges and opportunities, and I gained a lot from the session. Today, data and agility are the keys to commercial advantage – if you know how to make best use of them. BGL made it clear that it is keen to work with us to reach a whole new level across these two themes.”

    Will Price, Director of Product and Panel Development at BGL Group, said: “The personal lines market is a highly competitive space, and challenging for both insurers and brokers. Ultimately, our vision is to be insurers’ Distributor of Choice, and a key part of this conference was around investigating how best we can achieve this for mutual benefit. We knew that data was an area of great interest, as is a more flexible approach to rating, but it was very useful to gain specifics from our delegates around what they want, need and how it can be used.”

    To round off the day’s interactions, delegates enjoyed a dinner in the unusual and exclusive surroundings of the Household Cavalry Museum, with a reception on Horseguards Parade.

    0 0

    Fitch Ratings expects reinsurers to continue to abide by their core investment principles in the face of a possibly protracted low-yielding investment environment. Nevertheless, some smaller reinsurers are preferring to keep asset duration to a minimum (of about one year) as they seek to reduce the balance-sheet (solvency) shock which could occur when interest rates rise, while also providing the opportunity to reinvest earlier at higher interest rates, according to a new report.

    Fitch expects reinsurers to remain focused on maintaining sufficient liquidity to meet and settle liabilities in a timely manner, and avoiding excessive balance sheet volatility. Inability to accomplish this due to a lack of adequate liquidity could have negative outcomes including regulatory intervention, rating downgrades and loss of confidence by policyholders and investors.

    “In general, Eurozone concerns and potential shocks to investment assets are trumping reinsurers’ desire for higher yields,” says Martyn Street, Director in Fitch’s Insurance rating group. “While conventional wisdom advocates closely matching the duration of assets and liabilities, some smaller companies appear less inclined to follow this approach rigidly.”

    Major sovereign bonds now yield around 0.5%, compared with 4-5% in mid-2007. As yields remain persistently low, reinsurers’ attention has turned to the asset side of the balance sheet. Uncertainty created by the macroeconomic environment, and the implications for yields on certain key asset classes of policymakers’ handling of the crisis have made decisions more challenging. Attention has been focused by the reality of reinvesting maturing bonds at significantly lower yields.

    Fitch regards direct exposure to the Eurozone debt crisis as manageable overall for reinsurers, although contagion would be a concern. The broadening of the Eurozone sovereign crisis is intertwined with the investment challenges created for reinsurers by the current and future level of interest rates.

    0 1

    The UK P&I Club, one of the oldest shipping protection and indemnity insurance mutuals, has welcomed an announcement by the ratings agency Standard and Poor’s upgrading the UK Club’s outlook from “Stable” to “Positive.”

    In its review, Standard and Poor’s said “The positive outlook reflects our expectation that the UK Club’s stronger and more stable underwriting performance of 2011 and 2012 will continue through 2013-2015.”

    It also noted the Club’s improved operating performance as evidenced by the combined ratio, strength of management strategy, and the improvement in its competitive position.

    Dino Caroussis, Chairman of the UK P&I Club, said: “This is a welcome endorsement by S&P of the UK Club’s efforts to maintain balanced underwriting and a strong capital position in an environment of rising claims costs and volatile investments.

    “We are dedicated to our goal of being the leading ship owner controlled provider of marine liability insurance and maintaining our level of capital within the AA range of Standard & Poor’s capital model.”

    Hugo Wynn-Williams, chief executive of Club managers Thomas Miller P&I Ltd., said: “Our return to the top level of the P&I market has been rewarded by increased support from new and existing Members.  However, we will continue to focus on breakeven underwriting and careful management of our risks; from monitoring the UK Club’s entry criteria, an extensive loss prevention programme, and strong claims management, through to the purchase of reinsurance to protect against potential spikes in claims.

    “The UK Club has maintained its disciplined approach to underwriting and risk selection as evidenced by a further solid underwriting performance.  The last four policy years have achieved an average combined ratio below 100 per cent.”

    The UK Club’s funds have continued to strengthen in the first half of 2012 with free reserves and capital increasing a further $8 million to $494 million at 20th August 2012.  The UK Club is one of the strongest clubs financially in the International Group with a free reserve ratio of 167 per cent.

    0 0

    New research from Friends Life reveals that over 61% of people would either opt out of a pension scheme altogether (26%) or would be unwilling to contribute more than 5% of their salary to their pension pot (35%). At the same time, only 14% thought that saving the equivalent of 8% of their salary each month (the total level auto-enrolment will reach with combined employer and employee contributions plus tax benefits) would be sufficient to fund a comfortable retirement.

    Worryingly, only 13% stated they would be happy to personally contribute more than 10% of their salary. Whilst the results show that a majority of consumers are open to saving something for retirement, a 5% personal contribution may not be enough to provide the level of income that people expect to receive in retirement. Individuals may need to save a substantial amount more to ensure their long-term financial wellbeing is at a level which will sustain the lifestyle they want.

    The survey also reveals which measures would encourage people to put more into their pensions. Increased tax relief (41%) and a clearer idea of the income that will be provided at retirement (31%) were the most popular responses. Better annuity rates also rate highly (27%) as does the ability to withdraw pension monies before retirement (25%) and greater flexibility (23%). One in five (20%) said nothing would persuade them to increase their contributions. Other results from the survey show that nearly 9% of the population claim they would struggle to make ends meet with the deduction of a 1% pension contribution from their salary, the minimum starting employee contribution under the new auto-enrolment scheme. A further 5% said it would affect them ‘significantly’ and a further 14% ‘quite a lot’.

    Colin Williams, Managing Director of Corporate Benefits at Friends Life comments,

    “Auto-enrolment is the first step in encouraging people to save for the long-term and consider their financial security in retirement.  “The current economic climate is undoubtedly squeezing employees’ incomes, but to prevent retirement poverty we have to motivate people to take responsibility and start saving early. The low starting rate for contributions under auto-enrolment should help in this respect.

    “The easiest way to prevent retirement poverty is to encourage employees to start saving early. If auto-enrolment fails to kick-start the fight against retirement poverty, the government will have to consider other options, which may include compelling people to save rather than just nudging them along.”

    Prev1...91011...82Next Page 10 of 82

    POPULAR POST

    Seroni Interactive is an independent publisher of information BtoC and BtoB sites in banking and insurance & specialist digital content. Our productions of brand content possible to affirm your image, positioning, demonstrate your expertise and create a traffic or a hearing and therefore advertising exposure for your brand.
    Contact us: contact@news-insurances.com

    SOCIAL

    34FansLike
    6Subscribers+1
    965FollowersFollow

    Popular category

    © Seroni Interactive