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    A nurse was secretly filmed accidentally switching off a tetraplegic British man’s life-support machine, leaving him with brain damage, the BBC reported Monday as it showed the footage.

    The Nursing and Midwifery Council has suspended nurse Violetta Aylward pending an investigation. Jamie Merrett, left paralysed from the neck down by a 2002 road accident, had a camera installed in his home when he became suspicious about the care he was receiving.

    The video, which was passed on to the BBC, shows Aylward mistakenly turning off the ventilator before making a botched attempt to resuscitate Merrett.

    A colleague is heard saying “what have you done?” to Aylward, who replied “switched this off,” while pointing at the ventilator.

    Merrett, from Devizes in southwest England, was apparently aware of the mistake and can be heard clicking his tongue in an attempt to attract the nurse’s attention.

    Aylward tried to revive Merrett but applied a resuscitation bag in the wrong place. The machine was turned back on after 21 minutes as paramedics correctly revived the 37-year-old but not before he had suffered brain damage.

    “He doesn’t have a life now,” Merrett’s sister Karren Reynolds told BBC television. “He has an existence but it’s nowhere near what it was before.”

    Before the incident, Merrett was able to talk, operate a wheelchair and use a computer through voice-activated technology. Ambition 24hours, the agency which provided the nurse for the National Health Service (NHS) said it could not comment as an internal investigation was under way.

    A report by the local Wiltshire social services authority, leaked to the BBC, concluded that the agency did not have adequate systems in place to check that staff had received the necessary level of training.

    The NHS Wiltshire Primary Care Trust said in a statement: “(We have) put in place a series of actions to ensure that such an event will not occur again either for this patient or others.”

    London, Oct 25, 2010 (AFP)

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    Two thirds of Brits have been forced to change their driving habits because of higher fuel prices, according to a poll by moneysupermarket.com.

    Britain’s number one comparison site asked site users whether higher fuel prices were forcing them to change their driving habits.1 The results found a staggering two thirds of respondents (65 per cent) admit that rising costs have taken their toll. Over half of those polled (57 per cent) have reduced the amount of time they spend behind the wheel, and a tenth (8 per cent) claim they have stopped driving because of the costs.

    However, a third of motorists (31 per cent) say they are sticking to their usual driving habits as they can just about still afford it, while five per cent aren’t changing their driving habits at all.

    Steve Sweeeney, head of car insurance at moneysupermarket.com, said: “We’re all looking at ways to lower our everyday outgoings and getting behind the wheel is a real drain on finances. With recent fuel price hikes and increasing costs of car insurance, drivers are turning savvy and making changes to their usual habits to drive down costs.

    “Cutting out driving altogether is the ultimate sacrifice to take. Shopping around for the best deal on your car insurance cover is crucial to reduce the overall costs of motoring; providers count on your apathy to reap the profits and do not reward your loyalty with a cheaper premium. Taking further steps like fitting an approved car alarm or immobiliser and parking in a locked garage if possible are other ways to reduce the overall cost. Finding a policy to suits your needs will ensure you avoid unnecessary costs and means you can still get behind the wheel when necessary.

    Source : Moneysupermarket.com Press Release

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    Bangkok braced for rising waters encroaching on the city on Sunday as the death toll from two weeks of nationwide flooding rose to 38, emergency officials said. The floods, which began on October 10, have affected millions of people across huge swathes of the country, inundating thousands of homes and leaving authorities struggling to reach people stranded in remote areas.

    Authorities in the capital have reinforced flood walls with 200,000 sandbags and are building temporary wooden bridges in 27 communities to help people cross waterlogged streets. More than 1,000 water pumps are on standby and authorities are preparing schools, monasteries and mosques in 13 districts for evacuation.

    “From now on the river level will increase every day, as there is a period of high sea levels,” said Veera Wongsaengnak, deputy director general of the Irrigation Department.

    Prime Minister Abhisit Vejjajiva said that while floods in the kingdom’s east and northeast were receding, the situation in central provinces was a concern, especially with high tides due in the next few days.

    “I’m trying my best to mobilise all possible assistance to solve this problem,” he said in his weekly television broadcast.

    The Emergency Medical Institute of Thailand reported a further six deaths to add to Saturday’s toll of 32, who were swept to their deaths or killed in accidents as vehicles were carried away by the churning waters.

    The two worst-hit northeastern provinces of Nakhon Ratchasima and Buriram have each reported six deaths, while six people were also killed in Lop Buri and three died in Khon Kaen. A further 17 people have died in eight more provinces across central, northeastern and eastern areas, including one in Nonthaburi province, just north of Bangkok.

    The Irrigation Department on Saturday issued warnings to people living in seven low-lying provinces, including Bangkok, as water from further north began to flow downstream.

    Around 4,000 cubic metres (a million gallons) of water per second was expected to flow into the capital’s Chao Phraya river, which coupled with high sea levels surging from the other direction could cause floods in parts of the city. But water levels were unlikely to be exacerbated by rainfall in Bangkok and central provinces in coming days, according to the meteorological department.

    The commerce ministry warned businesses not to take advantage of the floods by hoarding goods or raising the prices of construction materials, the Bangkok Post reported.

    “If traders use this opportunity to lift the prices higher they could face a maximum of seven years in prison and a maximum fine of 100,000 baht (3,500 US dollars),” Commerce Minister Porntiva Nakasai was quoted as saying on the newspaper’s website.

    More than 2.5 million people, or 800,000 households, have been affected by the two weeks of flooding, which has hit 30 out of Thailand’s 76 provinces, the Department of Disaster Prevention and Mitigation said.

    Bad weather has battered countries in the region in recent weeks, with dozens killed in Vietnamese floods and nearly 50 people left dead in the Philippines and Taiwan by Typhoon Megi, which has roared into southern China. In western Myanmar, Cyclone Giri killed at least one person on Friday and left tens of thousands in need of help.

    Bangkok, October 24, 2010 (AFP)

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    Britain’s mutually-owned Cooperative Group is considering a sale of its life insurance business as part of a reorganisation of its financial services division, newspapers reported on Sunday.

    The Cooperative, which runs businesses ranging from supermarkets to funeral homes, has appointed Deutsche Bank to review the future of its life insurance arm, the Sunday Times and the Mail on Sunday said.

    Potential bidders for the business, which has 18 billion pounds ($28.25 billion) in assets, include listed insurers Legal & General, Aviva, Resolution and Phoenix Group, as well as rival mutual insurer Royal London, the papers said.

    The Cooperative could not immediately be reached. Deutsche Bank declined to comment.

    The reports come as Cooperative’s financial services division is pressing ahead with the integration of Britannia, Britain’s second-biggest building society, which it bought in January last year.

    Source : Reuters

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    Commenting on the announcement, in today’s Spending Review, on flood defence investment, Nick Starling, the ABI’s Director of General Insurance and Health said:

    “The Government is right to recognise the importance of continued investment in flood defences. But we are disappointed that this will not be maintained at current levels, given the scale of the problem and the wider economic benefits provided by flood defences to our communities and businesses.

    “We urgently need a long-term plan to tackle the rising flood risk this country faces over the next 25 years, especially as the Statement of Principles on Flood Insurance comes to an end in 2013.

    “In the last spending review, the previous Government committed to £2.15 billion for three years 2008 – 2011. Today, the Government committed £2 billion over four years 2011- 2015”.

    Source : ABI Press Release

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    Insurance Australia Group Limited (IAG) today announced the resignation of current CEO of CGU, Mr Duncan West for family reasons and the appointment of Mr Peter Harmer as his successor.

    Mr Harmer is the former CEO of Aon Limited UK and before that, CEO of Aon’s Australian operations. He has worked in the insurance industry for around 30 years, predominantly in Australia, and his career has spanned underwriting, reinsurance broking and commercial insurance broking.

    IAG Managing Director and CEO, Mr Michael Wilkins, said he was disappointed to lose someone of Duncan’s calibre from the executive team, however, he understood his decision to spend more time with his family, given the travel involved in his current role.

    “Duncan has made a significant contribution during his time as CEO of CGU. Under his leadership,

    CGU has delivered a $130m improvement in underlying insurance profit over the past two years, placing the business on a clear turnaround path. We’re confident the momentum established within

    CGU will continue as the changes made to improve the business are now fully embedded,” Mr Wilkins said.

    “Peter is well-known and highly regarded within the insurance industry. During his time as CEO of Aon Limited UK, he led a significant turnaround in the business. Before that he led Aon’s Australian operations, significantly growing the business while delivering an improved operating margin. His depth of experience, established relationships and proven leadership qualities make him a valuable addition to our organisation.”

    Mr Harmer will commence on 8 November 2010 but will have an extended handover with Mr West who will remain with the organisation until the end of January 2011.

    Mr West said: “I’m very proud of what we’ve achieved together at CGU over the past two and a half years. It’s been a difficult decision to leave the company, however, after careful consideration I believe it’s the right one for my family. My wife and I have adopted two children from India and my priority is to care for and support them. Living in Sydney and leading a company based in Melbourne is simply not sustainable in these circumstances.

    “I leave CGU confident that the turnaround will continue. I’ve known Peter for 10 years and respect him both personally and professionally. He’ll be supported by a highly experienced and capable team within CGU to make sure we continue to build on the solid foundations we’ve established.”

    Peter Harmer has 30 years experience in the insurance industry, having started as a claims officer in 1979. He has held senior roles in underwriting, reinsurance broking and commercial insurance broking.

    He joined the Aon Group in 1987 and most recently served as CEO of Aon Limited UK. During his three years in the role he led a significant transformation in the business, delivering an improved operating margin. Before that he was CEO of Aon’s Australian operations for seven years.

    Other roles Mr Harmer has held include Managing Director of John C. Lloyd Reinsurance Brokers (where he led the merger of John C. Lloyd and Alexander Howden in 1996), Chairman and Chief

    Executive of Aon Re, Chairman of the Lloyd’s Market Reform Group, and a member of Aon’s Global Executive Board. He also held senior claims and underwriting positions at C.E. Heath Underwriting & Insurance and South British United Insurance. Mr Harmer is a graduate of the Harvard Advanced Management Programme.

    Source : IAG Press Release

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    Sterling Insurance Company has issued a warning to its high net worth clients following forecaster predictions of a colder than average winter for 2010/11.

    A key differential in Sterling’s claims ethos is to help educate clients on preventative measures that can minimise the impact of any incidents.  With winter around the corner and summer a distant memory, Sterling is taking the opportunity to remind their high net worth client base of some sensible precautions through the release of their “Watch out for winter” leaflet.

    “Winter is the highest season for claims’’ says David Sweeney, Director of Personal Lines at Sterling Insurance Group. “Our winters are becoming increasingly colder which leads to more burst pipe claims, and because we are seeing an increase in the number of en suite bathrooms, wet rooms and more water based appliances, we are also seeing an increase in the number of ‘escape of water’ claims. In 2009, according to Datamonitor, escape of water claims increased by over 20% costing the industry some £904m.”

    Some of the key messages in Sterling’s winter message revolve around prevention of burst pipes. Clients are encouraged to insulate the loft, all water pipes and also the sides of water tanks.  If leaving the home empty in the winter for any length of time clients are advised to leave the central heating on low and if practical leave the loft hatch open, to avoid the pipes freezing.  Sterling’s bulletin also asks clients to locate their water mains stop tap and ensure that it can be accessed in an emergency.

    Source : Sterling Insurance Company Press Release

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    Around 1,500 petrol stations located on the forecourts of French supermarkets had run out of fuel Monday amid strikes against pension reform, their industry association told AFP.

    Around 4,500 of France’s 12,500 filling stations are attached to shopping centres, and they are the country’s busiest, supplying 60 percent of the fuel used by French motorists.

    “Twenty to 25 percent of our distribution capacity is either stopped or in trouble,” said Alexandre de Benoist, a senior official with Union of Independent Petroleum Importers, which represents the sector.

    He said that some regions, in particular Brittany and western France, were in a “very worrying” situation because fuel distribution stations were either on strike or blockaded by strikers from other sites.

    “There are at least 1,500 stations that have run out of at least one fuel product or are totally dry,” he added.

    Paris, October 18, 2010 (AFP)

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    The German insurer joins CKI, the investment group owned by Hong Kong billionaire Li Ka-shing and two consortia – Eurotunnel, Goldman Sachs and M&G in one and 3i, the Abu Dhabi Investment Authority and Morgan Stanley in the other.

    The price for the railway, known as High Speed 1, is thought to be around £2bn. The 68-mile railway linking London to the Channel Tunnel is one of the most highly sought-after assets being sold by the Government in the current round of privatisations.

    First-round bids were submitted in August with the second round expected soon. Other assets being sold off by the Government include the Dartford Thames crossing and the national air traffic control system.

    A German bid for High Speed 1 would add to an increased volume of German investment in UK transport assets. Earlier this year, the German state-owned railway Deutsche Bahn bought rail and bus group Arriva for £1.6bn.

    Deutsche Bahn also recently won a £700m order to replace the Eurostar fleet of trains.

    Source : Telegraph

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    Brit Insurance, the international general insurance group, announces the appointment of four new board directors to its two main underwriting platforms: Brit Insurance Limited and Brit Syndicates Limited.

    The four new directors are currently executives within the Brit Insurance Group. Malcolm Beane (Group Chief Operating Officer), Ray Cox (CEO, UK business unit), Jonathan Turner (CEO, Brit Reinsurance and Active Underwriter of Lloyd’s Syndicate 2987) and Matthew Wilson (CEO, Global Markets) join both boards subject to regulatory approval.

    Brit Syndicates Limited manages the Group’s wholly aligned Lloyd’s Syndicate 2987 with gross written premium in 2009 of £897.0m. Syndicate 2987 has licences, through Lloyd’s, to write insurance in over 65 territories including the US, and licences to write reinsurance business in these and many other territories.

    Brit Insurance Limited’s gross written premium in 2009 was £797.9m. It is the Group’s UK FSA authorised and regulated insurance company and is licensed to write most lines of insurance business in the UK and EEA territories and reinsurance business in these and a number of other territories.

    Dane Douetil, Group Chief Executive, commented: “I am delighted to welcome Jonathan, Malcolm, Matthew and Ray to these boards. Their considerable combined experience will be of immense value to meet the increasing challenges facing our industry, including those posed by Solvency II.”

    Source : Brit Insurance Press Release

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    Aon will cut 1,500 to 1,800 jobs over the next three years, the insurance conglomerate said Thursday, two weeks after closing its acquisition of Hewitt Associates.

    The combined companies have not yet decided where the headquarters will be located, but a spokesman said Thursday that “as both companies are based in Illinois, we are very committed to Illinois.”

    Aon is based in downtown Chicago, and Hewitt is headquartered in Lincolnshire. The spokesman could not say how many of the job cuts will affect Chicago-area employees.

    Before the merger, Hewitt employed 23,000 workers globally, including about 5,500 throughout Illinois, and Aon employed 6,000 workers globally, including 400 in Chicago.

    A broad restructuring of the company will be completed by the end of 2013, and Aon said it expects to save $355 million a year, including $280 million a year by eliminating jobs.

    Aon closed its $4.9 billion acquisition of Hewitt Associates, a human resources specialist, this month. The company has about 36,000 employees, including 29,000 in its Aon Hewitt human resources business. The job cuts announced Thursday will trim 4 percent to 5 percent of that work force.

    The company said the plan will cost $325 million to implement, including $180 million in severance costs and $145 million in real estate expenses.

    Source : Chicago Suntimes

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    RIAD, the International Association of Legal Protection Insurance, convenes its 21st Congress in London today. This high level international forum will examine the importance of quality in the evolving legal services market and highlight the key role of legal expenses insurance in delivering access to justice.

    The Congress, at London’s Park Plaza Riverbank hotel, brings together insurers, consumers, representatives of small businesses and lawyers – from around the world – and will include audience voting, panel discussions and debate.

    The chairman of the Legal Services Board in England and Wales, David Edmonds, will set out key elements of the reform programme for legal services in the UK, including quality assurance for advocacy, the new Legal Ombudsman and regulatory reforms.

    In his address to the Congress, the internationally renowned quality expert Teun W. Hardjono will explore the application of established quality models to the provision of legal services.

    RIAD General Secretary Antje Fedderke comments: “we’re delighted that this year’s Congress is so diverse, bringing together representatives from all aspects of the legal services sector.”

    “RIAD recognises that providing high quality legal services starts with providing widespread access to justice, and stretches far beyond simply securing the desired legal outcome. Our interactive Congress will provide a unique insight into what quality legal services will mean going forward and it is widely anticipated by the legal services community. We also look forward to sharing the key findings of the 21st RIAD Congress in the official report which RIAD will publish soon.”

    Source : RIAD Press Release

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    AXA Direct and swiftcover.com have announced the appointment of Brett Bennett as Head of Ecommerce.

    Bennett will report directly to CEO Stephen Hardy and will have overall responsibility for setting ecommerce strategy for AXA and swiftcover.com, including continuous site innovations and improvements and managing the two brands’ ecommerce team.

    Bennett joins from Debenhams Retail PLC, where he was the Senior Web Manager responsible for the Debenhams.com ecommerce site.  Under his management, this achieved a 45 per cent increase in overall visitors.  Bennett also gained industry recognition from The Independent as one of the leading figures in Ecommerce in 2009 and 2010.

    Bennett said, “I am pleased to be joining such a forward thinking company, particularly one that places such a heavy emphasis on online interaction with its customers. This will provide a challenge that will both test and excite me, and I am thoroughly looking forward to helping to continually progress the swiftcover.com online offering.”

    Bennett was previously Head of Web at Middlesex University, where he studied prior to his employment, attaining a BA in visual communications and an MA in design for interactive media.

    Source : AXA Press Release

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    Airedale and North Bradford Police have fired a warning to criminals after successfully confiscating £150,000 from Mohammed ‘Mojo’ Rashid on October 11 under the Proceeds of Crime Act.

    Mr Rashid was ordered to pay police £150,000 within six months at the Bradford Crown Court hearing, and has been told he will still owe Police another £150,000 after that has been paid.

    Mr Rashid, who was convicted in 2008 of arranging fake accidents for fraudulent insurance claims and is currently in prison, was also warned he will face a further two years, four months in jail if he fails to pay Police the first £150,000 in time.

    In total, the former owner of ‘Keighley’s Autotransform’ garage was sentenced to five years for the ‘crash for cash’ scam following a joint investigation into the business by Airedale and North Bradford CID and the Insurance Fraud Bureau.

    The POCA money which is now to be confiscated from Rashid will now be re-invested in both the fight against crime nationally and also in projects to help divert people from becoming involved in criminal behaviour.

    Detective Sergeant Dave Marston who heads the specialist POCA unit at Airedale and North Bradford Police, said his team were pleased with the confiscation: “This is a very substantial and significant confiscation for our POCA team in Keighley and really does hammer the message home that we do now have the tools to make sure crime does not pay.

    Detective Chief Inspector Mabs Hussain of Airedale and North Bradford CID, added:“We all hate to see criminals benefit from crime and the size of this confiscation clearly shows that we are willing to pursue criminals for very significant sums of cash though the court system. “Our team of detectives and specialist financial investigators are currently investigating a number of cases in Keighley and North Bradford and more action is pending.

    “I would again ask anyone who is aware of criminal activity or who thinks their neighbours might be benefitting from the proceeds of crime to contact the Why Should They campaign.”

    IFB director Glen Marr said: “The insurance industry should not be viewed as an easy target for organised fraudsters, as highlighted by the success of another joint Insurance Fraud Bureau/Police operation, this time with West Yorkshire Police, resulting in custodial sentences and the confiscation of ill gotten gains.

    “This latest example demonstrates that insurance fraudsters not only carry the very real risk of custodial sentences, but exposure to confiscation proceedings.

    “Insurers who suffer losses at the hands of fraudsters, will also not hesitate to utilise civil legal action to recover losses, further underlining industry intolerance to fraud, and ultimately protecting the interests of genuine insurance customers.

    “Insurers and the public are tired of funding fraudsters lifestyles and I would urge anyone with information on any type of insurance fraud, whether a current or previous fraud and not just crash for cash, to either call the Insurance Fraud Bureau free and confidential Cheatline.”

    Source : Post Online

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    In a massive reversal of fortunes, P&I clubs have seen a collective investment return of US$619 million for the year ending 20 February 2010, compared with a more than US$800m loss in the 2008/9 policy year, according to Aon, insurance broker and risk management firm. Save any external factors of seismic proportions, market conditions are likely to restrict the upper level of any general premium increase at the February 2011 renewal to 5%, according to Aon’s P&I Mid Term Review.

    While most P&I clubs have ridden the wave of a bullish equities market to rebuild their Free Reserves, which collectively stand at an all time high of US$2980m, storm clouds on the financial horizon could threaten to capsize this recovery. However most clubs are taking a ‘steady as she goes’ investment approach so far with no knee-jerk reactions to the European sovereign debt crisis.

    Aon continues to warn, though, that while investment income is a useful source of capital to enhance free reserves, it is a poor substitute for underwriting discipline.

    Stephen Griffiths, director of Aon Risk Solutions’ marine team, commented: “It is hardly surprising that a sharp downturn in world trade during 2009 should have produced fewer ‘routine’ P&I claims. What is more difficult to explain is the sudden relief in the number and magnitude of so called “pool” claims (individual claims in excess of US$8m) in 2008, even while the shipping markets and ship employment remained and even reached their peaks.  This reduced trend in pool claims was repeated in 2009, albeit with the year starting fairly badly and seeming set to level off some way north of 2008, but well below 2006 and 2007.”

    In this context the very poor results of 2006 and 2007 appear to be more random in nature as opposed to a “new norm”, as some were predicting.

    Stephen continued: “Looking forward to the 2011 renewal, much improved P&I market conditions on the back of more than ten successive years of general increases indicate a more benign renewal season. Those clubs with sound technical underwriting results and restored free reserves should be in the position to set their general premium increases at or near zero. Some will undoubtedly argue the need for modest general increases to counter the effects of general inflation and will endeavour to ‘talk up’ future claims as the shipping markets continue their apparent to return to relative normality.”

    A copy of Aon’s P&I Mid-Term Review can be downloaded from here.

    Source : Aon Press Release

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    AXA Insurance has appointed Neil Hammond as casualty manager of mid corporate risks. Neil will be responsible for driving the profitable growth of the casualty mid corporate offering and will report directly to Martin Eyres, the head of mid corporate risks.

    Neil joins from Arista where he was UK head of casualty looking after the UK casualty account. Prior to joining Arista Neil worked for Allianz for four years and AIG for eight years as liability underwriting manager.

    Martin Eyres, head of mid corporate said:

    “Neil brings a wealth of experience and expertise to AXA, as we continue to build our team, product and services tailored to the corporate sector.”

    Neil Hammond started at AXA on 13 September.

    Source : AXA Press Release

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    Aon Benfield, the world’s premier reinsurance intermediary and capital advisor, is partnering with the Institute of Catastrophe Risk Management (ICRM) and Nanyang Technological University (NTU) in Singapore to sponsor two new research projects.

    As part of Aon Benfield Research’s new academic and industry collaboration, which aims to deliver relevant research to the reinsurance industry, the new projects comprise:

    – Assessing the impact of catastrophes on maritime business, by Lay Hui Ivy Tan from the Maritime School

    – Asian motor liability, by Chong It Tan from the Actuarial School

    George Attard, Head of Aon Benfield Analytics in Singapore, commented: “This is a great opportunity to partner with one of the leading educational institutions in Asia and to learn from each other to improve risk awareness. Motor liability and catastrophe risk in marine business are both extremely relevant and growing fields in Asia, so it was important to make this investment on behalf of our clients, while further supporting academia in the region.”

    Source : Aon Benfield Press Release

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      AXA is urgently calling on the government to be clear about its plans for the UK’s flood defence strategy and future funding to ensure that households in flood-prone areas continue to be protected.

      With the forthcoming Comprehensive Spending Review it is still not clear where the money will come from to implement the ‘Flood and Water Management Act’ (FWM), which passed into law just before the General Election.  Uncertainty remains on how deep cuts to funding on flood defences might be, while the risk of flooding is set to increase as the UK experiences more frequent and extreme weather events.   AXA managing director of claims, David Williams, is arguing that a long-term plan and early enactment of the remaining Pitt proposals are now essential.

      In its presentation at the Conservative Party Conference on Tuesday 5th October, AXA will underline that without this certainty, insurers will find it hard to continue to provide affordable cover to those living in flood-prone areas once the insurance industry’s ‘Statement of Principles’ comes to an end in 2013.

      ‘The Statement of Principles’ agreement obliges insurers to provide cover as long as the government continues to invest in an adequate flood defence programme.

      Unlike much of Europe, the UK benefits from an almost unique system of flood insurance whereby ABI members have committed to continue to offer flood insurance for domestic properties and small businesses as a feature of most standard policies.

      Mr Williams comments: “The UK is at a crossroads.  If funding for ongoing flood defences and mitigation cannot be guaranteed, or a risk-sharing approach cannot be agreed when the Statement of Principles finishes, it could potentially result in householders in high risk areas being faced with significant increases in insurance costs, or difficulty in finding suitable cover at all.”

      Any new, risk-sharing scheme would need to involve insurers, reinsurers, government, businesses, communities and individuals. Many householders do not realise that flood insurance is heavily subsidised and discounted due to distortion in the insurance market brought about by the Statement of Principles.  People in low risk flood regions are subsidising those living in higher risk regions.  Recent AXA research highlights that householders are unaware of the true cost of flood protection, or of the risks to their insurance cover with the ending of the Statement of Principles.  AXA’s research shows that over three-quarters of households (77%) living in higher risk flood regions were not aware that their insurance premiums were being subsidised by those living in a low risk region.

      At the same time less than one in five householders living in a higher risk flood region thought their premium would need to rise by 40% to avoid any subsidisation: recent ABI research suggests that home insurance for those at significant risk of flooding is under-priced by 165%.

      However, more than six in ten (62%) said that people who live in higher risk flood regions ‘should expect to have access to affordable flood insurance’. If they are to continue to retain this benefit, the question is who will pay?  Interestingly just over half (57%) would be willing to pay an extra 50% on their insurance premium.

      The need for certainty from government can only become more urgent.  Many areas of the UK continue to face serious flood risk, highlighted by the recent substantial UK flood events including Boscastle (August 2004), Carlisle (January 2005), Hull & South Yorkshire (June 2007), large parts of the South West of England (June/July 2007), and Cumbria (November 2009).

      Source : Axa News Release