This may seem completely crazy, but some Japanese show exposed how to insure your shoes.
We have all known some kind of inconvenience while walking with our favorite shoes on a walkabout in the city or in a park on a sunny day. This insurnace product allows you to walk assured knowing your brand new or favourite shoes will be safe from ending up in the bin too quickly.
Here is the video for us to share a short laugh:
Catastrophe modeling firm AIR Worldwide (AIR) today announced that its Catastrophe Risk Engineering (CRE) solutions now cover industrial and renewable energy facilities worldwide. The expansion of these risk solutions is aimed at helping insurers, facultative reinsurers, brokers, and risk managers better assess the natural catastrophe risk to industrial facilities and wind and solar energy installations throughout the world. AIR’s recent studies of renewable energy infrastructure reveal that the best approach to quantifying the catastrophe risk for such unique facilities is a site-specific engineering-based risk assessment.
“The in-depth knowledge gained from site-specific assessments has informed our research on the vulnerability of industrial and renewable energy facilities, which we have found to be acutely sensitive to site- and asset-specific characteristics,” said Dr. Akshay Gupta, principal engineer and director of the CRE practice at AIR Worldwide. “AIR now has the capability to conduct detailed, site-specific, engineering-based risk studies globally, through our Catastrophe Risk Engineering consulting services.”
Based on AIR’s recent research reports on the seismic and wind vulnerability of modern wind turbines and solar arrays, the quantification of the catastrophe risk of renewable energy assets pose several interesting challenges. First, renewable energy structures and systems are relatively new, and, as a result, there is an acute scarcity of data — not only on their historical performance under extreme loading, but also on available detailed characteristics of the assets. Second, renewable energy structures have completely distinct features from other typical industrial infrastructure, and therefore it may be inappropriate to use other industrial assets as surrogates for these systems.
Additionally, the wind and solar energy industries continue to grow quickly throughout the world. The worldwide wind energy industry alone increased its capacity by more than 20 percent in 2010. Much of the growth is occurring in regions such as the United States and Asia, which have significant earthquake and tropical cyclone hazard, and Europe, which has significant earthquake and extra-tropical cyclone hazard. Consequently, a thorough understanding of renewable energy asset vulnerability is critical to managing and mitigating the risk associated with this rapid growth industry.
Motivated by these issues, AIR has developed a systematic engineering-based approach to assess the catastrophe risk associated with wind and solar energy installations on a site-specific basis. “We believe that a rigorous understanding of the performance of wind turbines and solar arrays to natural catastrophes is essential to appropriately address issues of risk management and financing associated with such projects,” continued Dr. Gupta. “With this in mind, AIR conducts detailed engineering analyses for assets with unique risk characteristics to evaluate their behavior under severe ground shaking and winds.” The results show that the performance or damageability of such systems is highly sensitive to a multitude of site- and asset-specific details that make quantification of the risk difficult using broadly categorized approaches typically found in risk models.
Dr. Gupta concluded, “Based on our research findings, we believe that solutions typically used by the industry may not provide reliable estimates of the vulnerability for unique risks such as renewable energy infrastructure. Until such time as a majority of installation types are analyzed and understood, the best approach for assessing risk for such unique assets remains a site-specific risk assessment.”
AIR has successfully translated detailed site-specific analysis work into catastrophe models as evidenced through the release of its engineering-based industrial facilities module within the U.S. Earthquake and Hurricane Models over the past two years. The industrial facilities module, which enables the sophisticated modeling of industrial facilities, is based, in substantial part, on site-specific engineering work done on specific industrial facilities. AIR envisions a similar track for industrial facilities and renewable energy infrastructure worldwide. Currently, AIR’s catastrophe risk solutions for industrial facilities outside the United States and for renewable energy facilities worldwide are available on a consulting basis. However, with increased application over time, these solutions will result in improved data and will be translated into robust catastrophe models.
AIR’s CRE services provide transparent and reliable loss estimates for industrial and commercial facilities. They are used by risk managers and brokers for risk assessment, mitigation, and emergency response planning. They are also used to facilitate decisions regarding insurance coverage. By combining CRE services with AIR’s state-of-art risk modeling, AIR is able to provide catastrophe risk solutions for industrial assets and renewable energy assets throughout the world.
Source : AIR Worldwide Press Release
Royal Sun Alliance has hired City headhunter Anna Mann of MWM Consulting to begin the search for a new chairman and a number of new non-executive directors.
RSA will follow in the footsteps of Aviva, the global insurance group, which is in the final stages of appointing a new chairman to replace Lord Sharman.
An announcement on his replacement – Barclays deputy chairman Sir Richard Broadbent is believed to be the main contender – could come as early as Wednesday this week, when the company holds it annual general meeting.
Mr Napier hit the headlines last year when he publicly berated President Obama for his public treatment of BP. He accused the US President of being anti-British and said he had been “prejudicial and personal” in his dealings with the British oil giant following the Deepwater Horizon explosion.
His term of office at the insurer comes up for renewal in 2012, although a final decision has not been taken as to whether he will stand down at that point or remain for another year.
Possible contenders for the role could include John Varley, the former chief executive of Barclays, and Clara Furse, the former chief executive of the London Stock Exchange.
Ms Furse is currently senior independent director of Legal & General, and although often tipped for the chairman’s role there, she is respected for having a good working knowledge of the insurance world.
A source with knowledge of Ms Mann’s appointment said that she is “looking across the piece” ahead of a refresh of the board.
The current board, including Mr Napier, is thought to want to ensure an orderly succession for Mr Napier and the other board members who will be departing. The move is not thought to be a reflection of RSA’s audacious but ultimately unsuccessful £5bn approach to buy Aviva’s general insurance arm last August.
Mr Napier, 68, has been on the RSA board since January 2003, and was appointed chairman two months later, a month before Andy Haste joined as chief executive.
Under corporate governance rules, he will lose his independent status after next year, his ninth year on the board.
Other non-executives who are likely to take their leave from the company include Edward Lea, the senior independent director, and John Maxwell, the former director general of the Automobile Association. Both joined the board in 2003.
In terms of board succession protocol, it is likely that Mr Lea will be replaced sooner rather than later, to allow a new senior independent director to steward the appointment of a new chairman.
It is not the first time Ms Mann has worked with RSA, having worked with the board last year to carry out an evaluation of the board and its committees. The review found that the board is “strong and effective” with a “good relationship” between executive directors and the rest of the board.
Ms Mann, one of the founders of Whitehead Mann, is one of the Square Mile’s pre-eminent headhunters. She was responsible for hiring Gerald Kleisterlee, the former Philips chief executive, to replace Sir John Bond as chairman of Vodafone, and appointing Carl-Henric Svanberg as chairman of BP last year.
Prior to joining RSA, Mr Napier was managing director of Hays, the business services group, and AGB Research, the market research provider.
In addition to chairing RSA, he is also chairman of media group Aegis, and chaired Kelda until its sale to a consortium led by Citigroup in 2008 for £3.04bn.
Source : Telegraph
According to catastrophe modeling firm AIR Worldwide, across the South, from Arkansas to Virginia, severe thunderstorms and an unusual number of tornadoes (more than 160 reported on Wednesday alone) raged through seven states causing the most loss of life from a natural disaster since Hurricane Katrina in 2005. Whole neighborhoods were destroyed and power was cut to over a million households.
On Wednesday, the city of Tuscaloosa in Alabama (population about 95,000) was especially hard hit, as were several areas just outside of Birmingham, the state’s largest city (population 212,000). The National Weather Service has since surveyed the event and has made a preliminary “EF-5” rating of the tornado on the Enhanced Fujita Scale. EF-5 is the highest possible rating (estimated wind speeds of at least 200 miles per hour). This is the first EF-5 rating in Mississippi since 1966. According to the National Weather Service’s survey, most of the homes that were destroyed were well built, less than 10 years old, and bolted down to their foundations.
“This outbreak of tornadoes resulted from the confluence of atmospheric conditions that together created a prolonged period of tornadic thunderstorms in the southeast,” said Dr. Tim Doggett, principal scientist at AIR Worldwide. “Colder air from the northern plains moved southward in the form of a cold front that became established throughout the southern Gulf States. This cold front interacted with warm, humid air from the Gulf of Mexico and resulted in the formation of thunderstorm activity.”
“However, the primary factor that controlled the severity of the event was a large and very strong jet stream disturbance that moved over the region on Wednesday and Thursday,” continued Dr. Doggett. “The strength of this disturbance provided the needed energy to sustain a high level of activity—and thus supported the development of high intensity tornadoes. At the same time, the large size of the disturbance allowed strong storms to develop over a larger area than normally is the case. The combined effect of the jet stream’s influence was the large number of very strong tornadoes that was witnessed over the several days.”
This series of developments shows some similarities to those of the previous most deadly tornado outbreak, which happened in April of 1974 and killed 310 people. That event also saw a large, intense jet stream disturbance result in both a large number of tornadoes, and a large number of intense tornadoes. “This week’s outbreak was different from the 1974 outbreak in that its frontal system was not as progressive (that is, it didn’t move as steadily eastward). Consequently, the 1974 outbreak covered a slightly larger area,” said Dr. Doggett.
For the past two weeks, much of the United States has been in a pattern in which thunderstorm activity has occurred where different air masses have come into conflict (where a cold front has separated colder air from the northern plains from warm, humid Gulf air). Periods of enhanced jet stream activity moving over these locations has resulted in the series of severe thunderstorm outbreaks. The repetitive nature of these outbreaks, along with their geographical concentration, is similarly reminiscent of the extended 2003 outbreak—which resulted in $3.2 billion dollars (in 2003 dollars) in insured loss at the time.
“It should be noted that none of the individual meteorological elements is unusual,” explained Dr. Doggett. “Large, strong jet stream disturbances happen occasionally; persistent frontal features are common, especially in spring; the locations where storms have been occurring are where they are expected to be at this time of year. What is unusual is for all of these risk factors that contribute to the development of severe thunderstorms to align themselves so optimally in the same place at the right time. To get optimal intense instability, shear, and lift all in the same place for a long period of time is a relatively rare circumstance. It should also be noted that while the current season’s tornado activity went from unremarkable early on to well above average, there is no indication that this trend will continue. ”
According to AIR, modeling losses from actual severe thunderstorm events in real time is an extremely challenging task. The systems are made up sometimes of hundreds of “microevents” (individual tornadoes, hailstorms, and straight-line windstorms). These events typically are of short duration—often lasting only minutes—and more often than not, they occur out of the range of weather stations or anemometers. When no measured wind speeds are available, scientists must estimate wind speeds from observed damage. The damage itself is highly localized. A tornado may destroy houses on one side of a street, leaving houses on the other side intact. Additionally, the data-gathering and analysis process can take from weeks to months. Preliminary counts published by the Storm Prediction Center will continue to be refined as the data is cleaned of duplicates.
More than 200 deaths reportedly occurred in Alabama on Wednesday alone, making it the deadliest day of tornadoes in the United States in four decades. (The current total of loss of lives in all the effected states is more than 300.)
Source : AIR Worldwide Press Release
The scrapping of the age 75 annuitisation rule could inadvertently encourage people to stay in drawdown for longer than is suitable and mean they risk missing out on the benefits of mortality cross-subsidy, warns MGM Advantage, specialists in retirement income and Intelligent Pensions, the pensions and retirement specialists for IFAs. For a 70 year old male living for 20 years with a pension fund worth £100,000, this could mean missing out on over £70,000.
Mortality cross-subsidy is the process of pooling the funds of annuity policyholders who have died earlier than expected and sharing these among remaining customers. You don’t get mortality cross-subsidy with income drawdown. At MGM Advantage the mortality cross-subsidy is awarded in the form of a Lifetime Bonus.
Indeed, analysis of MGM Advantage’s own investment-backed annuity, the Flexible Income Annuity, shows how a 60 year old male with a £100,000 invested in exactly the same funds as an equivalent income drawdown product, and living for 20 years would receive an additional Lifetime Bonus of £27,200, whilst a 70 year old male would receive £75,900 over the same time period.
| Age annuity is purchased | Years 1-5 | Years 6-10 | Years 11-15 | Years 16-20 | TOTAL over 20 Years |
| Age 60 | £2,500 | £4,700 | £7,800 | £12,200 | £27,200 |
| Age 65 | £4,500 | £7,900 | £12,900 | £20,200 | £45,500 |
| Age 70 | £7,600 | £13,300 | £21,600 | £33,400 | £75,900 |
Chart one: Based on a quote for the MGM Advantage Flexible Income Annuity, male, single life with £100,000 pot, showing the predicted mortality cross-subsidy (Lifetime Bonus).
Aston Goodey, Sales and Marketing Director at MGM Advantage comments, “There is a huge danger that now people aren’t legally obliged to purchase an annuity at age 75, they will drift along in drawdown without fully understanding the progressive nature of its risk.
“Drawdown becomes less suitable over time, as beyond age 75 the ability to deliver consistent investment returns that will compensate for the absence of mortality cross-subsidy, become increasingly unrealistic. This coupled with rising inflation, highlights how unsuitable drawdown is as a long-term solution for some people.”
Andrew Pennie, Marketing Director, Intelligent Pensions adds, “The decade that stretches from age 70 to age 80 is the best time frame for the majority of clients to implement their exit strategy from drawdown, some starting sooner than others depending on their specific priorities and financial circumstances.
“Many drawdown investors have an appetite for some investment risk and we believe the MGM Flexible Income Annuity offers an excellent stepping stone away from drawdown, as part of a phased exit strategy. As a lifetime annuity It delivers mortality cross-subsidy with the security of a guaranteed minimum income, the benefit of low fund management charges and the potential for member bonuses.”
The MGM Advantage Flexible Income Annuity gives customers the potential to receive a greater income than through a fixed level conventional annuity. The product, which has just celebrated its 1st anniversary, includes the flexibility to change income levels at different stages of retirement and the potential for growth and therefore the potential to act as a natural hedge against the impact of inflation. It also provides a minimum income guarantee and death benefits.
The flexibility of the product and the fact that the minimum investment is £10,000 means it’s suitable for the majority of UK consumers who are willing to accept an element of investment risk on some of their pension savings, providing they have a minimum income guarantee to rely on. Low annual management charges and a simple range of investment funds to choose from will make the product attractive to a previously poorly-served group of retirees.
Source : MGM Advantage Press Release
Europe launched antitrust probes Friday into giant US and European banks whose fine-slicing of the insurance market was blamed by debt-ridden eurozone states for pushing them into bailouts.
The investigation focuses on Credit Default Swaps (CDS), derivative financial products traded between financial institutions or investors originally meant to protect investors in the event a company or state they have invested in defaults on payments, but also used today in speculative investment portfolios.
These products have helped push up yields when trading government bonds issued by Greece and other struggling European states.
The antitrust probe comes amid slow-moving work on legislation by European Union financial services commissioner Michel Barnier aimed at curbing leeway for the main players in a lucrative and hugely influential market.
CDS derivatives have become for some a symbol of reckless speculation in the wake of the eurozone sovereign debt crisis that first hit home in Greece and has since sucked in both Ireland and Portugal.
In a two-pronged investigation, the European Commission said it will examine whether 16 investment banks and Markit, the leading provider of Credit Default Swap market information, colluded or abused a dominant position to control financial information.
The banks are: JP Morgan, Bank of America Merrill Lynch, Barclays, BNP Paribas, Citigroup, Commerzbank, Credit Suisse First Boston, Deutsche Bank, Goldman Sachs, HSBC, Morgan Stanley, Royal Bank of Scotland, UBS, Wells Fargo Bank/Wachovia, Credit Agricole and Societe Generale.
The commission will also look at whether preferential tariffs received by nine of the banks from ICE Clear Europe, the leading clearing house for CDS, locked their competitors out of the market.
“Lack of transparency in markets can lead to abusive behaviour and facilitate violations of competition rules and the commission should react accordingly,” said European Union competition commissioner Joaquin Almunia.
“I hope our investigation will contribute to a better functioning of financial markets and, therefore, to a more sustainable recovery,” he underlined.
These products “play a useful role for financial markets and for the economy,” Almunia maintained.
“Recent developments have shown, however, that the trading of this asset class suffers a number of inefficiencies that cannot be solved through regulation alone,” he said.
Information about CDS is needed to allow market participants to determine the value of their investment portfolios and develop investment strategies.
The commission said it had indications that the banks, which act as dealers in the CDS market, give most of the pricing, indices and other essential daily data “only to Markit.”
“This could be the consequence of collusion between them or an abuse of a possible collective dominance and may have the effect of foreclosing the access to the valuable raw data by other information service providers,” the commission explained.
“If proven, such behaviour would be in violation of EU antitrust rules,” it said.
The probe will also look into the behaviour of London-based Markit, a company which the commission said was created to enhance the transparency of the CDS market and which is as well known for regular survey snapshots of economic health.
The commission said it was concerned that certain clauses in Markit’s licence and distribution agreements “could be abusive and impede the development of competition in the market for the provision of CDS information.”
The second investigation is looking at preferential fees and profit sharing agreements between nine banks and ICE.
“The effects of these agreements could be that other clearing houses have difficulties successfully entering the market and that other CDS players have no real choice where to clear their transactions,” it said.
Brussels, April 29, 2011 (AFP)
Insurance Database Services Ltd (IDSL) has entered into an agreement with Motor Insurers’ Bureau Management Services Ltd (MIB MSL) for the provision of infrastructure and management services. The decision, designed to add value and secure long term resilience to IDSL services, takes place with immediate effect and has been approved by the Association of British Insurers’ General Insurance Committee (ABI GIC).
MIB MSL will report to the IDSL board and have responsibility and accountability for the management of the database services operated by IDSL: Claims and Underwriting Exchange (CUE) and Motor Insurance Anti-Fraud & Theft Register (MIAFTR). IDSL members have been contacted and received confirmation that users of CUE and MIAFTR should continue to access and utilise the databases as previously. A project team is in place at MIB MSL to manage the transition of CUE and MIAFTR data asset management from IDSL and to ensure a business as usual service for members. IDSL members will additionally benefit from formal account management services and a single point of contact at MIB MSL.
Phil Nunn, Interim Chief Executive, IDSL comments: “IDSL undertook a strategic review of its evolving market place in 2010 which recognised an increasing demand for use of CUE and MIAFTR data in consumer facing transactions such as motor quote, new business and renewal for underwriting purposes. Acknowledging the limited resources available to IDSL, and following consultation between the respective Boards, MIB MSL was appointed to provide the necessary support and experience to ensure the data assets grow in value for IDSL members and remain fit for purpose and robust as their uses evolve.”
Ashton West, Chief Executive, MIB comments: “MIB MSL has a proven track record in providing support services to the industry and has established data asset management, finance, compliance, project management and account support expertise. This appointment harnesses relevant expertise and will leverage operational efficiencies going forward. MIB MSL is committed to supporting the industry in the use and development of these valuable databases.”
Source : IDSL/MIB Press Release
Japan’s largest property and casualty insurer MS&AD will pay about 70 billion yen ($860 million) to acquire a 50 pct stake in the life insurance unit of Indonesian conglomerate Sinar Mas, a source with direct knowledge of the deal said on Friday.
Japanese insurers have been stepping up overseas expansion, with a focus on emerging economies in Asia, as they see weak growth prospects at home given the country’s ageing population.
The deal is scheduled to be announced on Monday, said the source, who did not want to be identified because he was not authorised to talk publicly about the matter.
Mitsui Sumitomo Insurance, the core unit of MS&AD, would acquire the stake in Sinar Mas Multiartha through a private placement of shares, said the source.
Sinar Mas Multiartha shares jumped 23 percent on Friday. Japan’s markets were closed on Friday for a national holiday.
The deal was first reported by the Nikkei business daily on Friday.
MS&AD was created in April last year through the merger of three insurance companies, becoming Japan’s top property-casualty firm in terms of net premiums written.
The company has been most aggressive in expanding in Asia. It bought Aviva’s property-casualty insurance operations in Asia for 65 billion yen in 2004, which propelled the Japanese company into the league of major non-local players in many of the region’s markets.
Last year, it acquired a 30 percent stake in the life insurance business of Malaysia’s Hong Leong Financial Group for 940 million ringgit ($304 million) and merged their non-life operations in the country.
Source : Reuters
Motor insurance companies in Jersey will have to cover some of the treatment costs for people who have been in a car crash.
The health department have said it could save more than £200,000 a year.
Under Jersey law the health service is entitled to claim up to £2,000 from insurance companies for each person it treats injured on the road.
General Hospital managing director, Andrew McLaughlin, said his department would start doing so from May.
Mr McLaughlin said car insurance premiums were already calculated to include the cost recovery.
In 2010 more than 400 people went to Jersey General Hospital after a car crash.
The health service said that had some of those costs been recovered from insurance companies it would have made the health service about £200,000.
Mr McLaughlin said insurers could take part in a review of cost recovery, including whether the amount the hospital claims could be increased if a patient needs off-island treatment after a serious crash.
Source : BBC
If an individual has been hit by the new higher tax rate introduced on the 6th April, John Lawson, head of pensions policy at Standard Life, shows how they can avoid it by paying a pension contribution.
John Lawson said: “According to accountancy firm, Grant Thornton, another 700,000 people would begin to pay higher rate tax from 6th April this year. This change will hit people not previously regarded as high earners including many nurses, junior doctors and police officers – particularly those who earn overtime or have local cost of living allowances.
“The reason why more people are caught is due to a reduction in the income level at which higher rate tax starts. This stops higher rate taxpayers gaining from the £1,000 increase to the personal allowance. So, rather than start paying 40% tax when your income reaches £43,875, as happened in the 2010/11 tax year, higher rate tax starts at £42,475 this year.
“Although the change is supposed to be income tax neutral, someone with income at or above £43,875 will pay £80 more income tax this tax year compared to 2010/11.
“And it’s not just income tax that’s changing. The rate of national insurance for higher earners is rising from 1% to 2%. This rate starts when weekly earnings reach £817, which on an annual basis is £42,475 – the same as the income level at which higher rate income tax starts.
“Thankfully, you can do something about it. By paying a pension contribution, you can effectively expand your basic rate tax band, avoid higher rate tax but still benefit from the new higher personal allowance. Here’s an example:
Tom earns £45,000 a year. In 2010/11 he paid income tax of £7,930 and national insurance of £4,209. This left him with take-home pay of £32,861. If he earns the same amount this year then his tax bill will rise to £8,010 with £4,281 of national insurance on top, leaving him with £32,709.
“By paying a gross pension contribution of £2,525, Tom will avoid higher rate tax and reduce his income tax bill by £1,010 to just £7,000.
“If Tom is in an occupational pension scheme, he can pay this from his salary before tax is deducted and get the tax relief that way. Alternatively, if he saves in a personal pension, he will pay a contribution of £2,020 net of basic rate tax. This gives him immediate tax relief of £505 and he can claim the other £505 back at the end of the tax year. Either way, he will receive 40% tax relief on these personal contributions to his pension.
“Even better, if Tom’s employer offers salary sacrifice he can save on national insurance (NICs) payments too. Salary sacrifice means you give up part of your salary – in this case £2,525 – on the understanding that your employer will pay the amount sacrificed into a pension for you.
“Reducing his pay in this way will save Tom another £51 in NICs, but his employer also saves £348 NICs. Many employers who offer salary sacrifice pay part or all of their NIC savings into the employee’s pension. If Tom’s employer paid the whole saving into his pension, Tom’s total pension contribution would rise to £2873 at a net out of pocket cost to Tom of only £1,464.
“This means that Tom receives tax relief at an effective rate of 49%, which makes such salary sacrifice deals extremely attractive.”
Any reference to legislation and tax is based on Standard Life’s understanding of United Kingdom law and HM Revenue & Customs practice at the date of production. These may be subject to change in the future. Tax rates and reliefs may be altered. No guarantees are given regarding the effectiveness of any arrangements entered into on the basis of these comments.
Source : Standard Life Press Release
National crime statistics show an increase in domestic burglaries – new research from Ageas shows many of us still don’t lock our front door.
Ageas Insurance and The Neighbourhood Watch Trust have released new data to coincide with Home Office National Crime statistics released this month.
The research highlights that domestic burglaries are up 14%. Ageas experts say that this could increase throughout the summer months as the weather starts to warm up and people venture into their gardens or leave their windows open.
The new research from Ageas’s National Crime Prevention Initiative shows that just under one in two adults (47%) don’t lock their front door as a rule when they are at home. And that’s when sneak-in crimes can happen. More than one in ten (13%) only ever lock their front door at bedtime. Ageas also recently unveiled statistics highlighting that homes across the UK display on average £1223 of valuables such as TV’s, other electronic goods, antiques and works of art that are clearly displayed for would-be burglars to see through home windows. Nearly one in five people (18%) said that as much as £2,000 or more worth of valuables could be seen by a passer-by looking through a window. One in three people (35%) said that valuables worth more than £1000 could be seen.
Mark Cliff, Managing Director of Ageas Insurance said: ‘It’s often wrongly assumed that many household burglaries are committed while homes are empty. But canny burglars know that many people assume that by being at home, they themselves are a deterrent and so they take fewer precautions. But an unlocked front door or window can be an open invitation to a burglar while the occupier is distracted by spending time in the garden. With so few people routinely securing their home while they are there it’s no wonder that so many thefts are committed without a forced entry. It’s not about turning your home into a fortress but simply getting into the habit of locking doors and windows, regardless of the period of time the house or room is unattended.’
Roy Rudham, Chairman of The UK Neighbourhood Watch Trust, which gets 15,000 visits to its website each day said: ‘People should treat their homes like they treat their cars – don’t leave valuables on show, lock the doors and make sure you are insured. If you were to lock your home how easy would it be for you to get in? If you can easily gain entry, then a burglar will be in a lot faster than you.’
Top tips for homeowners include ensuring that expensive electronic games, laptops and other valuables are kept out of sight of windows and that all goods are marked with a security pen and properly recorded and photographed. Ageas has teamed up with The Neighbourhood Watch Trust to provide top tips to reducing the likelihood of becoming a target for burglars.
Source : Ageas Press Release
Pressure is building in one of the world’s most important markets, US government bonds. Dramatic changes in the landscape are likely.
The first shock was the recent speech by President Obama about US fiscal policy. For some time investors and commentators have been concerned about the massive build up of US debt: a deficit this year of 10-11% of GDP, so the same order of magnitude as the weakest European countries, while the debt to GDP ratio has reached a post war high.
At last, US politicians appear to be closer to biting the bullet. The President unexpectedly proposed big cuts to lower the budget deficit back to 2.5% of GDP by 2015. There had been earlier proposals, a Deficit Commission report last December, and a Republican programme earlier this month. By raising the stakes Obama’s speech was potentially a game changer. He has thrown the gauntlet down to Congress to consider his proposals, hoping that Vice President Biden can reach some ‘mega deal’ by June.
The second shock was the announcement by the credit rating agency Standard & Poors that it was revising down to negative its outlook for the USA’s AAA rating – indeed they warned there was a 1 in 3 likelihood that they could lower the long-term rating within 2 years. Financial markets were convulsed by this news; a downgrade could mean more expensive borrowing not only for the US government but also for many companies. If overseas investors pulled money out of US assets, the US dollar could weaken sharply.
The very threat of such disruption will, hopefully, encourage US politicians to redouble their efforts to reach agreement. This is not the first time such a downgrade has been threatened. In 1996 another agency, Moodys, put the US on watch, for a few months.
Now for the bad news. The S&P is worried about policy congestion in Washington. There are very large policy differences between the Democrats, Republicans and groupings such as the Tea Party. For example, Obama has proposed $3tn of spending cuts and $1tn of tax increases, while the Republicans suggested $6tn of spending cuts plus $2tn of tax cuts to reach a net $4tn. Specific areas of disagreement include repealing the Bush tax cuts, lowering defence spending or savings in Medicare. More worryingly, both camps rely on rather rosy scenarios. Obama has assumed that higher tax rates do not damage the economy, that interest rates stay unusually low, and that the economy avoids recession for a dozen years.
Economists have warned of the dangers for some time; in its recent Fiscal Stability report the IMF wrote about the fiscal crisis – not just the annual deficits but especially unfunded liabilities such as Social Security and Medicare, estimated at some $80tn in coming decades. Why haven’t US bond yields sold off more, as many commentators expected? The answer lies in the relationship between US fiscal and monetary policy – the US central bank is still buying bonds under its QE programme, while giving very strong signals that it does not expect to raise interest rates for the foreseeable future.
This summer could be very dangerous though. The QE programme ends in June, while by July Congress must decide whether or not to increase the $14.3tn ceiling on US debt issuance. Discussions could be tortuous; either side might feel emboldened to use this extension, or the threat of a government shutdown, to try and obtain concessions from the other. If Washington can agree sufficient fiscal austerity, US bonds could be very well supported; if not Treasuries could suffer serious damage. Under the ground, the pressure is building, potentially for a very large tremor in a few months time.
Source : Standard Life Investments Press Release
Aon Risk Solutions announced the consolidation of its loss portfolio transaction expertise with the creation of its Loss Portfolio Transactions Practice. The team will be led by Carol Murphy, a managing director based in Aon’s world headquarters in Chicago.
With more than $300 million in loss portfolio transfer premiums placed since 2009, Aon Risk Solutions has established itself as the leader in structuring and effecting loss portfolio transactions. While legacy transactions have consistently been used on the reinsurance side of the industry, economic drivers dictate the need for this approach for commercial clients as well. Loss portfolio transfers are widely applicable to organizations in merger and acquisition situations as well as those with high collateral obligations, looking to exit self-insurance, or hedge against volatility.
Through loss portfolio transactions, an organization’s collateral previously tied up on behalf of potential large liabilities can be reduced or eliminated while minimizing cost variability on its balance sheet.
“Against the odds in this low discount rate environment, many clients have benefited from our ability to successfully close these complex transactions. We are proud to lead the industry in loss portfolio transfers, and are supported by unmatched analytical and actuarial capabilities as well as market relationships through Aon Risk Solutions and Aon Benfield, respectively,” stated Murphy.
Tony DeFelice, head of Aon Risk Solutions’ National Casualty Practice, commented, “By taking this step to centralize the Loss Portfolio Transactions Practice under Carol Murphy’s leadership, we hope to open the eyes of organizations that have not yet been able to unlock the potential behind their balance sheets. Carol’s deep understanding of an organization’s complex financial objectives and her unique ability to execute upon them in the marketplace further opens the door for our clients’ growth and success.”
In addition to Murphy, Aon Risk Solutions’ Loss Portfolio Transactions Practice includes credentialed actuaries, claims resolution experts and brokerage colleagues with vast expertise in investment and finance.
Murphy has her MBA from the University of Chicago’s Booth Graduate School of Business and has been recognized four times by Risk & Insurance magazine as a Power Broker. In addition, she was named by Business Insurance magazine as a Woman to Watch in 2009.
Source : Aon Risk Solutions Press Release
Following the recent online data hack where millions of names and email addresses were stolen, Matthew Norris, e-risk and privacy expert at specialist insurer Hiscox, comments:
“The early signs are that Sony has suffered a breach of security which necessitates a redesign of their security, an unusual response and major undertaking likely to indicate a significant security vulnerability.
“It seems no fraud monitoring services are currently being offered: this may be a sign that Sony is not yet confident what accounts the hacker gained access to, and so is not willing to offer such a service to 70 million + users until they know who has been affected, when such a service could cost over $100 million.
“It all points to a sophisticated hack, rather than a college prank: sophisticated hacks are an accepted part of the threat landscape now, and often involve criminal networks to sell and use the data stolen.
“And the cost? Too early to tell, but the week’s delay, the outages, and lack of certainty in the communications will undoubtedly unnerve customers.”
Source : Hiscox Press Release
AXA Real Estate Investment Managers announces that it has raised on behalf of its clients a total of €1.26 billion in the first quarter of 2011.
Reflecting a growing trend from investors seeking separate mandates, €800 million of this new equity has been raised as segregated accounts from third party investors and AXA Group clients.
The €800 million of new equity for segregated accounts has been derived from new and existing investors across Europe, including France, Switzerland and the Nordics. Typically, these types of investors are seeking high-level, individually tailored solutions supporting their unique strategies, which enable them to benefit from AXA Real Estate’s multi-disciplinary, confidential services and its extensive global asset and investment management platform. With over €29 billion of separate accounts under management as at December 2010, AXA Real Estate ranks respectively #1 and #2 globally for its advisory and discretionary mandates activities.
In addition, AXA Real Estate has raised a total of €460 million for two of its pan European institutional investment vehicles, Development Venture III and its debt fund, Commercial Real Estate Senior 1, launched in January this year.
Kiran Patel, Global Head of Business Development, Distribution, Research & Strategy, commented:
“As we emerge from the economic crisis, we are seeing a continued and evolving change in the way investors, particularly large institutions, approach investment opportunities. They are increasingly inquisitive about investment strategies and undertake significantly more due diligence than in previous times. Whilst this inevitably results in a longer time frame for capital raising, we believe it is a positive step, which is conducive to a closer, longer term relationship with our clients, one that also creates and forges a strong working partnership for a similar end ultimate goal.”
“The strong momentum we have achieved in securing new equity from investors this year is a strong endorsement of our barbell investment strategy and our ability to tailor products specifically for investors’ individual needs. The fact that we have seen such strong interest from investors in both our debt and development funds in particular, reflects the increasing appetite since the start of this year for funds with strategies across the entire risk spectrum. Both of these funds are aiming to secure final closings before the summer. This will allow us to offer a new range of products which are innovative in structures, as well as investment strategies, not just covering Europe, but more further afield, Asia and US, thus building on AXA Real Estate’s plans to offer a global product offering. We expect to continue to see this strong capital raising momentum for the remainder of the year, based on our discussions with investors in Europe, but also Middle Eastern and US investors looking to deploy capital in the global markets.”
Source : AXA Press Release
Homeowners in Dorking, Surrey and in Edinburgh and Glasgow have seen the biggest rises in the cost of their home insurance premiums according to the analysis of 3.4 million quotations by Britain’s number one comparison site moneysupermarket.com.
The analysis reveals the UK’s postcode hotspots most affected by rising home insurance premiums. Residents of Dorking, Surrey, have seen an average 46 per cent increase to the cost of their home insurance premiums over 14 months, with cover rising from an average £119 to £174, or by 15 pence per day.
Homeowners in the city centre of Edinburgh and in Milngavie, Glasgow, have experienced similar increases (45 and 40 per cent respectively). This is in comparison to the national average which has seen an increase of 6 per cent, or 2.5 pence per day, to the typical cost for buildings and contents cover. Greater London postcodes have been the most affected, representing five of the top twenty hardest hit areas.
The most likely factors causing an increase in home insurance premium prices include, heightened cases of fraudulent claims, the cost of repairs from extreme weather damages and an increase in crime levels.
Julie Owens, head of home insurance at moneysupermarket.com said: “The cost of insuring homes in the UK is steadily on the increase. Unfortunately for consumers, things look set to get worse with the increase in prices unlikely to slow down in the coming years. As our research shows, some areas have been harder hit by rising premiums than others; unfortunately, postcodes can dramatically affect how much people pay for their home insurance premium.
“Additionally, if your property is classified as being in a ‘high-risk’ area – whether for crime, flooding or even fraudulent claims – it will be reflected in your insurance premiums. Living in a more affluent area will also increase premiums as property and contents values will generally be higher. Insurers use postcodes as a part of the overall risk factors when calculating premiums. Although there is very little you can do about the postcode in which you live, except move house, there are steps you can take to reduce your premiums, such as, installing a good home security system and security lighting.
“With this in mind, we urge anyone looking for a home insurance policy to shop around using a comparison website and ensure that they aren’t paying over the odds for their cover. The average saving for consumers using moneysupermarket.com to buy their home insurance premium is £127.”
moneysupermarket.com’s home insurance top tips:
– Change the locks – If you’ve moved to a new home you never know who might still have a key. It is important to maintain locks. Five-lever mortise locks are recommended for external doors while windows should ideally have two bolt locks.
– Install a good home security system – Sometimes there are alarm systems that might be preferred by an insurer. The NACOSS standard alarm can cut premiums with some companies by 7.5 per cent.
– Time-switch lights – Your home is more vulnerable to theft when you are not around. Time-switch lights will give the impression that you are at home.
– If you are away – Remember to cancel newspaper and milk deliveries and ask someone you can trust to open and close the curtains and collect mail.
– Keys – Don’t leave them in obvious places such as under a doormat. Also beware of ‘hook n crook’ thefts – where keys are left so close to a door that a burglar can simply hook them through a letterbox and open the door.
– Install security lighting – illuminate your visitors for their safety as well as your own. Unwelcome visitors are less likely to loiter if they’re ‘in the spotlight’.
– Join a neighbourhood watch campaign – this can help to reduce your premium if you inform the home insurance company of your participation in a scheme. It can reduce your premiums by up to 5 per cent.
– Avoid frozen and burst pipes – If you think pipes are frozen, turn off water at the valve and header tank to cut down the water that can escape.
– Fire – Fit a smoke alarm and take simple steps to avoid accidents. Most fires in the home are caused by smoking or cooking; never smoke in bed, don’t leave cigarettes lying around and don’t leave cooking unattended. Other fire tips include closing doors at night to contain fires, check the home is safe before going to bed and keep matches away from children.
– Don’t smoke – As covered above, the fire risk greatly increases if you smoke cigarettes. Most insurers will now ask if you are a smoker.
– Think about your cover – Do you really need accidental damage cover? This can increase premiums by 25%. Think carefully about the add-ons you need.
– Don’t claim unless you need to – The fewer the claims, the higher your no claims discount. So for minor issues that would be inexpensive for you to cover with your own cash, think twice before making a claim.
Source : Moneysupermarket.com
Evidence strongly suggests that as much as 50% of imported and exported goods, including ‘goods in transit’ purely in the UK, are uninsured for loss, damage or theft.
Some importers and exporters, and also firms with goods in transit purely within the domestic market take the view that if something is lost, stolen or damaged then the freight forwarder, haulier, shipping line or airline – as the case may be – will pay.
All too often this could not be further from the truth.
Virtually all companies in the transport field are legally entitled – under their contract conditions or applicable transport law – either to totally exclude all liability for claims or to limit their liability based on the weight of the cargo, usually resulting in payment of an amount much less than the loss actually suffered.
Also, claiming against such companies is a hugely time consuming and difficult business involving areas of the law with which most importers, exporters and, indeed, most lawyers are not familiar.
Marine cargo insurance covers goods in transit – both internationally and domestically within the UK – whether by road, rail, sea or air and can include both temporary and long-term storage during or at the end of the process. It’s a specialist area and at Bluefin we have specialist insurance staff with the knowledge, expertise and negotiating experience to help our clients enjoy the most appropriate coverage at the best price.
Cover can be arranged either on a case-by-case or annual basis for marine cargo insurance, shipping insurance, air cargo insurance or other areas of cargo/goods in transit insurance.
Anyone involved in the worldwide transportation of cargo will have hair-raising tales to tell of the problems and challenges that can be thrown at you. Bluefin has far-reaching experience of freighting matters, and the skill and expertise has made us market leaders in the field. Cover is provided under their own unique and exclusive wording, underwritten at Lloyd’s of London and other leading UK and European insurance organisations.
Their advisers and insurance brokers offer a close personal dedicated service, whether you’re a two-man operation or a multi-national organisation. They can provide practical risk management advice, assistance with contracts and help you achieve prompt resolution in the event of a claim.
They are also very active associate members of the British International Freight Association (BIFA) which helps keep pace with industry developments and stay in tune with the needs of clients.
Committed to providing essential protection for liabilities assumed in the shipping, forwarding, transport and storage of goods coupled with cargo “All Risks” insurance to give you and your clients reassuring peace of mind.
Bluefin cover offer includes :
– Freight insurance
– Freight liability
– Marine Cargo insurance
– Transit insurance
– Shipping insurance
French reinsurer will pay USD 913 million for a major stake in Aegon’s Transamerica Reinsurance operations. This should allow Scor to become America’s second largest life reinsurer.
Aegon said on Tuesday the disposal would help it repay outstanding state aid of 1.125 billion euros ($1.6 billion).
The deal is the latest in a round of consolidation in the North American life reinsurance market, as companies try to position themselves for a rebound after the financial crisis.
Last October, Warren Buffett’s Berkshire Hathaway bought Canadian insurer Sun Life Financial’s reinsurance business.
Europe is Scor’s biggest market and Transamerica will boost its market share in the United States, where it currently earns less than 30 percent of its global life reinsurance premiums.
“With the acquisition of a major mortality risk reinsurance portfolio in the United States, Scor aims to further increase its geographical diversification,” it said.
Scor, which also sells property and casualty reinsurance, eclipsed Reinsurance Group of America as the lead bidder for Transamerica in March, according to sources familiar with the matter.
Aegon said the deal consisted of cash proceeds of $0.9 billion with a further $0.5 billion in capital released. Aegon expected to transfer $1.1 billion to the holding company to support the repurchase of the remaining Dutch state aid.
The Dutch insurer, which got a total of 3 billion euros state aid from the Netherlands in 2008, still needs to pay back 750 million plus a 50 percent premium — 1.125 billion in total. It expects to pay it back by the end of June.
Scor said it would pay for the deal through its own funds and a potential debt issue of around 200 million euros, without the issuance of any new shares.
Scor said it would take over Transamerica Re’s mortality business, which had $2.2 billion in gross written premiums last year, of which 87 percent was generated in the United States.
The deal excludes Transamerica Re’s structured solutions and fixed and variable annuities, which were not in line with its strategic orientations, Scor said.
The transaction is expected to close this summer.
Source : Reuters
There will be a conference call on 28 April 2011 for analysts and investors at 9:30am (UK time) hosted by Jackie Hunt, Chief Financial Officer, and Paul Matthews, UK Take to Market Director. Dial in telephone number +44 (0) 1452 555 566. Callers should quote Standard Life Analysts & Investors call. The conference ID number is 60262347. A recording of this call will be available for replay for one week by dialling +44 (0) 1452 550000 (access code 60262347#).
Standard Life Wealth has created a set of five unique investment strategies that will form the backbone of the Standard Life Wrap Platform’s new Managed Portfolio Service (MPS).
IFAs using the Wrap platform will now be able to select from five strategies retaining the discretionary management services of Standard Life Wealth to actively manage their client’s portfolios. Standard Life Wealth’s investment team will adjust the portfolios to respond to changing market conditions and views on the underlying managers – from across the whole market – whose funds are being used within the portfolios.
The launch of MPS will allow more people to access the investment expertise of Standard Life Wealth’s discretionary fund managers.
Richard Charnock, Chief Executive Officer of Standard Life Wealth, said: “The Managed Portfolio Service is testament to how Standard Life’s Wrap technology development is leading the market. Standard Life Wealth is about bringing the best institutional investments techniques to bear on client portfolios and up until now this has meant we have had to restrict this expertise to clients with more than £500k to invest. Advancements on our Wrap platform mean we can now offer our discretionary expertise to more people.”
To help IFAs meet their client’s individual needs, each of the five strategies has been set up with a different level of risk and a different target return. With volatility management a key feature, the portfolios have been specifically created to provide a strong match with modern goals-based planning approaches. The aim at all times is to minimise volatility for the given target return and therefore maximise the certainty of the client achieving his or her goals.
As the service is fully embedded on the Wrap platform, IFAs can benefit from up-to-date holdings and performance information together with far richer reporting than typically available from managed fund-based approaches.
Standard Life Wealth’s Strategy & Business Development Director, David Tiller, said: “While we are keen to be able to participate in the growing MPS market it is very important to Standard Life Wealth that we did not merely launch a ‘me too’ solution.
“In creating the portfolio strategies we have looked to retain the purity of our investment approach. Unlike other MPS approaches, which rely solely on the standard universe of retail funds available on Wrap platforms, we have linked them to institutional-grade investment techniques via our exclusive Strategic Investment Allocation fund.
“This fund, when combined with the rest of the portfolio, allows us to greatly enhance portfolio diversification and take a more dynamic approach to the management of portfolio risks. The net result is the client receives a more consistent and predictable return for investors.”
Richard Charnock concludes: “Managed Portfolio Service brings together the best of both Standard Life and Standard Life Wealth. And it’s a great example of collaboration across Standard Life’s UK business. By combining investment capabilities with the platform know-how of Wrap to create our Managed Portfolio Service, we believe we have created a proposition of real value to IFAs and their clients.”
Source : Standard Life Press Release
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