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    As water begins to recede from most homes and businesses in Cumbria and Scotland following the recent flooding, it is time for lengthy drying out and clean-up operations to begin. The ABI offers further advice about what policyholders should be doing now, and what they can expect from their insurance companies.

    If you have been flooded:

    • Call your insurance company to make a claim – insurers will have 24-hour emergency helplines and are on the ground in flood-hit areas to help. Arrange alternative accommodation with your insurance company if you are unable to live in your property.
    • It is very important to remember that drying out flood damaged properties can take many months, especially during the winter. Where practical, leave doors, windows and cupboards open. If possible, keep rooms heated and do not rush to redecorate. Your insurance company will advise you on the right steps to take to get your property back in order.
    • Try and keep as many of your flood damaged belongings as you can, but if you do need to throw things out try to take photos of them, and where possible keep any receipts, warranties, handbooks or instruction manuals, as these will help with claims.

    Based on claims to date, our initial estimate for the cost of flood claims in Cumbria and southern Scotland is around £100 million, but this may increase as more complex claims, such as those for business interruption, are made.

    Nick Starling, the ABI’s Director of General Insurance and Health, said: “Once flood waters have receded and the damage to homes and businesses is assessed, the hard work begins.  Properties will take a long time to dry out fully and it could be many months before houses and businesses are restored to the condition they were in before the flooding. It’s vital that work does not begin prematurely on damp properties as this can cause problems later on. The good news is that insurers are on hand to react quickly and start the drying out and restoration process as soon as possible, and to help customers cope with life while their homes are drying out and being repaired by providing advice, support and alternative accommodation where needed.”

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      In the UK today, there are approximately 11.8million people of retirement age. With an average death age of 79[1] , a typical person in retirement can look forward to 16.5 years of relaxation and enjoyment in their later years – or can they?

      A research led by AXA amongst 1000 UK pensioners [2] uncovers the reality of what life is really like for pensioners today.

      Life in retirement

      When it came to looking towards their retirement over one in six (almost two million) of all current pensioners dreaded the lack of a social life, boredom and loneliness. This is borne out in reality with a similar number of those very pensioners today associating their retirement with depression – particularly men with almost a fifth feeling this way. Boredom is also a prominent issue of retirement with 15% associating it with this while one in eight also associate it with poverty. Similarly, one in seven associate this period of their life with loneliness.

      One of the biggest causes of sadness among pensioners is the isolation they feel being away from their family. The average retiree lives 53 miles away from relatives with one in eight living over 100 miles away. When asked, almost one in seven admit regret at not moving closer to family members before they retired.

      Less than half of all retirees believe they are enjoying a better retirement than their parents (45%), with one in nine believing they are in fact worse off.

      Coping with money

      One of the biggest retirement anxieties was the need to live off a restricted budget with over four million current pensioners (35%) not looking forward to this aspect whilst over one in six, dreaded the lack of a social life. With an average retirement income of £295 [3], the research shows that average disposable income available each week for pensioners after all bills and outgoings, is just £68.07. Perhaps unsurprisingly, almost half of all retirees wish they had saved more for retirement, whilst almost a quarter would have contributed to a private pension if they could have prepared differently for their later years. Almost one in five (17%) would have retired later.

      The research highlighted that while the maximum unexpected bill a pensioner could afford to pay is on average £1,666, one in 11 retirees (9%) would not be able to afford to pay an unexpected bill of £50 or less, with close to one in five (19%) having to borrow money from their friends and family should this happen. 17% would have to borrow from the banks, 10% would have to sell personal belongings and one in nine would pay for this on a credit card.

      Steve Folkard, Head of Savings and Pensions Policy at AXA said:       ‘Our research shows that far from the idyllic existence we are envisioning for ourselves in retirement; the reality is that our days are filled with much more mundane activities, largely because we are restricted – both by wealth and health – in what we can do. With 64% of people planning to support themselves in their retirement with the basic state pension, this is clearly an issue we need to address.

      “The 14 participants completing our ‘Living on a State Pension’ challenge realised just how tough this could be with boredom, isolation and poverty affecting their day-to-day lives, just as it does for many pensioners today.”

      Recent research [4] commissioned by AXA shows that the UK population believes that in retirement they will be splashing out on exotic holidays (44%), eating out regularly with friends (45%), spoiling the grandchildren (45%), going to the theatre (45%) and even buying new cars (over one in five). However the reality is that they will be facing years in front of the TV, sleeping and reading books to pass the time as boredom and budgets limit our retirement dreams.

      The My Budget Day research [5] shows that on average during their 16.5 years of retirement, UK pensioners will spend:

      • Over five years (almost 66 months) sleeping or napping
      • Almost one and a half years reading books, newspapers and magazines (just over 17 months)
      • Over two years (over 25 months) watching TV and using the Internet

      [1] World Health Organisation

      [2] Research completed by Onepoll amongst 1000 retirees during November 2009

      [3] http://research.dwp.gov.uk/asd/pensioners_income.asp

      [4] Source: YouGov Plc. Total sample size was 2110 adults. Fieldwork was undertaken between 15th – 16th October 2009. The survey was carried out online. The figures have been weighted and are representative of all GB adults (aged 18+).

      [5] Research completed by Onepoll amongst 1000 retirees during November 2009

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        The Norwegian Institute of Public Health has informed World Health Organization of a mutation detected in three H1N1 viruses. The viruses were isolated from the first two fatal cases of pandemic influenza in the country and one patient with severe illness.

        Norwegian scientists have analysed samples from more than 70 patients with clinical illness and no further instances of this mutation have been detected. This finding suggests that the mutation is not widespread in the country.

        The virus with this mutation remains sensitive to the antiviral drugs, oseltamivir and zanamivir, and studies show that currently available pandemic vaccines confer protection.

        Worldwide, laboratory monitoring of influenza viruses has detected a similar mutation in viruses from several other countries, with the earliest detection occurring in April. In addition to Norway, the mutation has been observed in Brazil, China, Japan, Mexico, Ukraine, and the US.

        Although information on all these cases is incomplete, several viruses showing the same mutation were detected in fatal cases, and the mutation has also been detected in some mild cases. Worldwide, viruses from numerous fatal cases have not shown the mutation. The public health significance of this finding is thus unclear.

        The mutations appear to occur sporadically and spontaneously. To date, no links between the small number of patients infected with the mutated virus have been found and the mutation does not appear to spread.

        The significance of the mutation is being assessed by scientists in the WHO network of influenza laboratories. Changes in viruses at the genetic level need to be constantly monitored. However, the significance of these changes is difficult to assess. Many mutations do not alter any important features of the virus or the illness it causes. For this reason, WHO also uses clinical and epidemiological data when making risk assessments.

        Although further investigation is under way, no evidence currently suggests that these mutations are leading to an unusual increase in the number of H1N1 infections or a greater number of severe or fatal cases.

        Laboratories in the WHO Global Influenza Surveillance Network closely monitor influenza viruses worldwide and will remain vigilant for any further changes in the virus that may have public health significance.
        To know more about what you should know about your insurance coverage and the H1N1, you can read :

        What you should know about your insurance coverage and the H1N1

        What is swine flu (influenza A H1N1) ?

        Swine flu – advice for parents and pregnant women

        Get prepared for the second wave: lessons from current outbreaks

        Pandemic (H1N1) – Recommended use of antivirals

        What you should know about your insurance coverage and the H1N1

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        Munich Re has acquired further shares in ERGO Versicherungsgruppe AG (ERGO) from Bayerische Hypo- und Vereinsbank AG (HVB) via an investment company.

        This acquisition increases Munich Re’s direct and indirect holdings in ERGO’s share capital to more than 95%. At ERGO’s next Annual General Meeting, scheduled for 12 May 2010, a squeeze-out resolution is therefore to be adopted.

        Nikolaus von Bomhard, Chairman of Munich Re’s Board of Management explained: “The squeeze-out that is now possible at ERGO will result in a significant simplification of shareholding structures, save costs, and further facilitate Group-wide cooperation within Munich Re”, .

        At the same time von Bomhard emphasised: “ERGO is and remains a key business field in our Group. The planned squeeze-out is a logical step in our integrated insurance group strategy.”

        The successful sales cooperation between ERGO and HVB will be continued.

        ERGO’s minority shareholders will receive appropriate cash compensation for their shares. This will be determined by Munich Re on the basis of a company valuation and will total at least the weighted average ERGO share price for the last three months prior to today’s date.

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        Following the recent recruitment of six new underwriters to its Manchester operation, QBE, the specialist business insurer, has further expanded the team with the appointment of Jon Hesketh to the position of Casualty Underwriter.

        Previously at AIG, Mr Hesketh is a casualty specialist with wide ranging experience in conventional and non-conventional business placements dealing with both national and independent brokers.

        Reporting to Antony Broome, Commercial Manager of the Manchester office, Jon joins the team as QBE continues to develop its multi-line liability, motor, property and professional indemnity offerings, which are written from its seven regional underwriting hubs, as well as accident & health, trade credit and motor trade classes, which are represented in some branches.

        Antony Broome, Commercial Manager of QBE’s Manchester office, comments: “The addition of yet more talent to our growing team ensures that we can further build our offering to brokers and their clients in the area. With Jon’s specialist casualty background, this appointment is another example of QBE’s commitment to providing underwriting excellence and expertise throughout the North West region.”

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        Lloyd’s Charities Trust is to donate this year’s Special Award of £50,000 to Whitechapel Mission Centre.

        The award will enable the centre to open overnight during the winter period and expand its life skills service. They will be able to employ another life skills support worker to help centre users with skills for the future such as cooking, budgeting and job hunting.

        Whitechapel Mission opens every day of the year to help people find a bed for the night and provides breakfast, showers, clothing, basic medical services, employment support and advice. When the temperature drops below zero in winter, the centre is open throughout the night offering accommodation for up to 250 people.

        Graham White, Chairman of Lloyd’s Charities Trust, said: “I am delighted that we are able to help Whitechapel Mission continue their invaluable work with the homeless community in East London. The services they provide offer to thousands what we take for granted, as well as a safe environment, where the homeless are treated humanely and kindly.”

        Employees throughout Lloyd’s have already supported the Mission by volunteering before work to serve breakfast, sort through donated clothing and help the life skills centre.

        On receiving the award, Tony Miller, Director of Whitechapel Mission, said: “We are extremely grateful for the support we’ve received to date from Lloyd’s on so many levels and are delighted to have received the Lloyd’s Special Award for 2009. Employees have given generously of their time to assist in delivering all of our core services and Lloyd’s has demonstrated a true commitment to supporting the homeless community and to supporting their volunteering staff.”

        Richard Ward, CEO of Lloyd’s, has volunteered at the Mission himself. “Having seen the incredible work the team at the Whitechapel Mission do first hand, I’m very pleased that we are able to make a contribution to support them.”

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          Federal officials have been urging pay czar Kenneth Feinberg to ease the compensation restrictions at AIG for 2010, according to the Wall Street Journal, arguing that the taxpayer would ultimately bear the burden if the restrictions are too severe.

          Feinberg last month announced cuts in 2009 compensation, including salaries and stock, for the top 13 AIG employees by 57%. New York Federal Reserve and Treasury Department officials recently urged Feinberg to avoid making 2010 pay similarly restrictive for some top executives and employees at the bailed out insurer, the Journal reports.

          Fed and Treasury officials told Feinberg that tough restrictions ultimately could jeopardize the government’s ability to recoup its roughly $90 billion in loans because key employees would leave.

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          Lloyds Banking Group Plc priced its record 13.5 billion pound rights issue at 37p per share, a smaller than expected discount, as it battles to escape a costly state-backed insurance scheme for bad debts.

          The cash call, the world’s largest to date and a critical plank of Lloyds’ bumper 22.5 billion pound capital raising effort, will involve the bank offering 36.5 billion new shares to investors.

          It will offer the stock on the basis of 1.34 new shares for every existing one, the bank said. The new shares will represent just over 57 percent of Lloyds’ enlarged share capital.

          Britain’s largest retail bank had said it expected the offer price to be at a discount to the 38 to 42 percent theoretical ex-rights price (TERP), and analysts had expected a price of around 35p, in the middle of that range.

          But the bank, 43 percent government-owned, came in with a marginally less aggressive discount than expected for its fully underwritten issue and a discount to TERP of 38.6 percent.

          Lloyds is seeking to bolster its capital to allow it escape the government’s asset protection scheme, set up earlier this year to protect banks against further credit losses, but now seen as too expensive.

          The bank will now seek shareholder approval for the rights issue at a meeting on Thursday, after which dealing in nil-paid rights will begin. The new shares will begin trading on December 14

          The bank, which has Britain’s largest private shareholder base, said the average retail shareholder would pay 366.7 pounds to take up their rights.

          As part of its bumper capital raising, Lloyds is also swapping existing debt into contingent or “top up” capital, which converts into common equity during a period of financial strain to shore up a bank’s capital position.

          It said on Monday demand for that exchange offer was strong, with offers of 12.5 billion pounds from investors received for an 8.78 billion bond exchange, allowing the bank to raise the maximum 8.5 billion in contingent core tier 1 and core tier 1 capital.

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          Swiss Re today announced the transfer of USD 75 million of extreme mortality risk in the U.S. and UK to the capital markets through a new VITA securitisation programme.

          Swiss Re has entered into a transaction with VITA Capital IV Ltd. (“Vita IV”) to receive up to USD 75 million of payments in the event of severe population mortality in United States or the United Kingdom.

          The agreement covers a five-year risk period starting in the issuance year and ending in 2014. Vita IV, in turn, has issued notes linked to this risk into the capital markets. The notes are rated “BB+” by Standard & Poor’s.

          This is a continuation of Swiss Re’s hedging strategy, enabling the company to manage extreme mortality exposures in a capital-efficient manner.

          Swiss Re’s Chief Underwriting Officer, Brian Gray, commented: “This Vita transaction will help us to manage our exposure to peak mortality risk in a capital efficient way, to meet increased client demand for extreme mortality risk protection and, ultimately, to position us for further growth.”

          Swiss Re Capital Markets acted as sole manager and bookrunner on the note issuance. Collateral for the Vita IV notes will initially consist of securities issued by the International Bank of Reconstruction and Development. Risk modelling and analysis was performed by Risk Management Solutions, Inc.

          Swiss Re has a history of securitizing its life risks, obtaining over USD 1.4 billion in extreme mortality risk protection in its predecessor Vita programmes.

          Notwithstanding the current media focus on the H1N1 virus, the Vita IV notes offering was a successful placement for Swiss Re. Christian Mumenthaler, Head of Swiss Re’s Life & Health business commented: “This transaction is another example where we sustain our leadership in the life securitisations market.”

          The Vita IV notes were sold in a private placement pursuant to Rule 144A of the U.S. Securities Act of 1933, as amended, (the “Securities Act”) and have not been registered under the Securities Act or any state securities laws; they may not be offered or sold in the United States except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act and applicable state securities laws.

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          Aon Corporation today announced that it will change the ticker symbol for its common stock listed on the New York Stock Exchange to “AON” from “AOC”.

          The change will become effective at the start of trading on Tuesday, December 1, 2009.

          “The Aon name is globally recognized as the industry-leading provider of risk and human capital solutions. Changing our ticker symbol to ‘AON’ extends this recognition and links our common stock listing with our brand,” said Greg Case, president and chief executive officer, Aon Corporation.

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            DAMAGE from the floods in Cumbria and south Scotland could cost insurers more than £100m, the Association of British Insurers (ABI) said yesterday.

            The body also warned that up to 1,000 claims had been received by insurers already, but that it was too early to say what the total damage bill will be.
            The ABI is urging those hit by the floods to contact their insurer as soon as possible.

            Over 1,300 homes were left without power or water after being pummelled by the bad weather, and a typical claim is likely to cost in the range of £20,000-£40,000.

            The floods of 2007 cost insurers £3bn, as 55,000 homes were hit, but this year’s are not thought to have been as wide-reaching or devastating.

            There are 19 flood warnings out in force around the UK, particularly in south-western and northern parts of England, Scotland and Wales.

            Nick Starling, the ABI’s director of general insurance and health, said: “Events like flooding highlight why insurance is so important.”

            “The first priority for insurers will be to ensure that every claim is dealt with as quickly as possible and they will do everything they can to help customers recover,” he added.

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            Taiwan will probe if the buyer of the local unit of American International Group has violated a long-term investment commitment by speedily selling on part of the company, an official said Friday.

            In October, AIG announced a Hong Kong-based consortium including China Strategic Holdings had agreed to buy Taiwan-based Nan Shan Life for 2.15 billion US dollars, pending regulatory approval.

            But even before Taiwanese regulators had given the green light for the deal, the consortium announced this week a decision to sell a 30-percent stake in Nan Shan to Taipei-based Chinatrust Financial Holding.

            In return, China Strategic will get a 9.95 percent stake in Chinatrust Financial.

            “The move to introduce Chinatrust Financial into the deal has complicated the transaction,” chief secretary of Financial Supervisory Commission Lu Ting-chieh said.

            “We will look into whether the buyer has broken its promise to operate Nan Shan Life as a long-term investment,” Lu told AFP.

            In a statement issued in October, AIG chief executive Robert Benmosche said the Hong Kong consortium had pledged to “continue Nan Shan’s commitment to its policy holders, agents, and employees, as well as to the people of Taiwan.”

            Taiwan’s Investment Commission, which is in charge of reviewing foreign investment applications, said Thursday it has returned China Strategic’s application to buy Nan Shan Life, saying more documentation was needed.

            “The Nan Shan deal matters to a great number of insurance policy holders in Taiwan. The resale agreement with Chinatrust Financial has raised concerns over the interest of the Nan Shan customers,” Lu said.

            Nan Shan Life was established in 1963, and now has a network of 24 branches and 450 agency offices, employing a staff of 4,000 and more than 34,000 agents.

            As of September 2009, it had four million customers.

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            Willis Group Holdings Limited, the global insurance broker, and the original family shareholders of Gras Savoye & Cie, the leading French insurance broker, announced today that they have signed a definitive agreement with Astorg Partners, a private equity fund, to reorganize the capital of Gras Savoye in a leveraged transaction.

            Gras Savoye has been an Associate company of Willis since 1997 when Willis acquired a 33 percent ownership interest. Since then, Willis has gradually increased its shareholding to 48.6 percent of voting rights (46.2 percent of outstanding shares). The family shareholders and management currently own 51.4 percent of the voting shares of Gras Savoye.

            Under the terms of the transaction, Astorg Partners will acquire 33.3 percent of the voting rights (31.8 percent of outstanding shares) of a new holding company while Willis and the family shareholders will sell part of their stakes in Gras Savoye to Astorg Partners and roll over their remaining shares into the new holding company, through a combination of equity, convertible debt and seller financing. Willis, the family shareholders of Gras Savoye, and Astorg will hold equal stakes of 31.8 percent in the new holding company and have equal representation of 33.3 percent of the voting rights on its Board. The remaining 4.5 percent will be held by a large pool of Gras Savoye managers.

            This transaction values Willis’ existing investment in Gras Savoye at approximately $343 million. Willis will roll over approximately $135 million in equity and convertible debt and lend approximately $48 million to the new holding company at a rate of 6 percent per annum. Willis expects to generate approximately $160 million of tax–free net cash proceeds from the transaction, which it will use to pay down existing debt.

            The agreement also gives Willis the option to purchase 100 percent of the capital in the new holding company in 2015, should it choose to do so, with notification in 2014. An existing put option, which gave family shareholders an option to sell their shares in Gras Savoye to Willis between now and 2011, will be cancelled at the closing of the transaction. The transaction is expected to close in the fourth quarter of 2009, subject to customary approvals and completion of financing.

            Joe Plumeri, Chairman and Chief Executive Officer, Willis Group Holdings, said: “Willis looks forward to building on the strong and valuable relationship we have established with Gras Savoye over the past 12 years, and we remain fully committed to our partnership. This new arrangement enhances Willis’ financial flexibility, while at the same time, engaging an important new strategic partner in its Gras Savoye investment.”

            Patrick Lucas, who will continue to head Gras Savoye as Chairman and CEO, said: “Our new ownership structure will allow everyone at Gras Savoye to be connected even more closely with the success of our business. As we pursue our strategy, we will continue to focus on serving our clients with the highest professional standards and further strengthening our strategic partnership with Willis to deliver the best global insurance and risk management services around the world.”

            Christian Couturier, a Partner at Astorg Partners, said: “We are delighted that the family shareholders and Willis have chosen to partner with Astorg for this new step in the development of Gras Savoye. The leadership of Patrick Lucas, the personal investment of a large number of Gras Savoye managers and employees, the support of Willis, as well as Astorg’s track record as a proactive shareholder in family companies, create the conditions for success in the next five years.”

            Willis was advised by Close Brothers and Willis Capital Markets and Advisory; Gras Savoye was advised by Close Brothers; and Astorg was advised by Bucephale Finance.

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            XL Capital Ltd today announced that it has received approval from the China Insurance Regulatory Commission (CIRC) to start preparation work to set up a P&C (non-life) company in China.

            In line with CIRC’s license approval process and under the leadership of Andrew Vigar, Regional Manager Asia for XL’s Insurance Operations, XL now has a year to prepare to establish its operations in China.

            After this period and upon receipt of all regulatory approvals and granting of the license, XL plans to establish an insurance subsidiary dedicated to serving both local international corporations, as well as its Global Program clients with operations in China. Mike McGavick, XL’s Chief Executive Officer, said: “China’s importance to any global company is obvious, and we could not be more proud to have received this critical approval. We are committed to work closely with CIRC to ensure we fulfill all regulatory requirements to attain the operating license in due course.”

            Dave Duclos, XL’s Chief Executive of Insurance Operations, said: “The increasing number of local companies with international activities, and the importance of this market to our Global Program clients with activities there make it critical for us to be present in China. We look forward to the chance of bringing our global underwriting expertise and service capabilities to bear in this important market in the future.”

            XL has had a representative office in Beijing since 2005 which is dedicated to deepening the Company’s understanding of the market.

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            “People have been affected by a weekend of storms and gales and the saturated ground will mean any more rain could cause flooding in England, Scotland and Wales” said Julie Owens, head of home insurance at Moneysupermarket.com.

            Unfortunately this sort of event serves as a reminder to those living in flood risk areas to make sure they are prepared for these eventualities and making sure they are fully insured is paramount.

            People living in ‘at risk’ areas should check the details of what their buildings and contents policies cover, as well as the limits and excesses on both. It pays to make sure that the quality of your insurance is high and you won’t be left out of pocket if you have to make a claim.

            Insurers have significantly improved their handling of flood cases and rating sophistication; for example providers would still provide cover for a customer if they had made a flood claim at a previous address. If a customer has made a flood claim at their current address and needs insurance, the typical advice is still to check if there is a better deal available but remaining with your current insurer is likely to be the best option.

            If you are unfortunate enough to be flooded, you may need to claim on both your contents and buildings policies. Those at risk from the flooding should take expensive portable items upstairs or somewhere else dry. And with risk of winds gusting up to 50mph in the coming days, it is also important to make sure any items in your garden don’t cause damage to your house and windows, or neighbouring houses. Your insurer will expect you to make attempts to minimise your claim.

            People should also consider their vehicles too; while home insurance is essential to guard your property, motor insurance should also be an important consideration for any flood risk to your car.

            To take action to prevent or protect your home or business against potential flooding you can find all you need to know about flood and natural disaster insurance by clicking here

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            While the global economy gradually recovers from its worst downturn in decades, KBC has been working on a strategic review to enhance its position in the post-crisis period.

            The new business plan will enable KBC to continue to act as a solid European regional player that is attractive for its customers, employees, shareholders and the communities in which it operates.

            The strategy will also generate enough capacity to redeem the capital securities that were issued to the State. The strategic plan, which was the basis for a restructuring plan as requested by the European Commission, was cleared by European regulatory authorities today.

            Highlights

            • Crisis lesson learnt: more focus on core businesses, risk levels to be reduced
            • Core bancassurance model largely untouched by crisis, growth options in Eastern Europe maintained
            • Non-dilutive exit from State liabilities, predominantly based on earnings accrual and reduced scope of international activities (and some divestments)
            • Group total risk-weighted assets to be reduced by 25%
            • Aim to resume dividend payout as of 2011
            • Plan cleared by European Commission
            • Institutional investor conference (Investor Day) scheduled for tomorrow, 19 November (London)

            Approval from the European Commission

            The European Commission on Wednesday approved restructuring plans for British bank Lloyds, Dutch counterpart ING and Belgium’s KBC bank, all rescued by public bailouts during the global financial crisis.

            In order to avoid distortion of competition within the European Union and to ensure that the temporary stimuli received by KBC from both the Belgian Federal and Flemish Regional Governments have been adequately financially remunerated, the European Commission was needed to approve these transactions.
            Jan Vanhevel: ’Discussions with the European Commission were not always easy since difficult trade-offs had to be made. But we appreciated the open and constructive way these discussions were held. The same holds true for our discussions with lead representatives from both the Belgian Federal and Flemish Regional authorities.’

            ’We are ready for the future. We have a clear vision for the years ahead supported by a strong business case. We will start executing the plan immediately and will closely follow this up. We will make sure that change processes are professionally managed and internal dialogue remains unambiguous and respectful, in line with our corporate culture.

            The decisions on divestment were not taken lightly. We will work carefully to manage the divestment process in a way that will support the success of our business in the interests of our customers, employees and shareholders alike.

            In addition, several of the intended measures are conditional on the approval or advice of the relevant works councils and local regulatory authorities.’

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            Belgian insurance company Fortis Holding is following the sale of a number of insurance businesses now on the market but may not have enough capital to pay the prices being asked, Fortis Chief Executive Bart De Smet said Tuesday on a conference call with analysts.

            Banks such as Royal Bank of Scotland Group PLC and ING Group have said they plan to sell their insurance businesses as part of restructuring agreements reached with the European Commission.

            “We have discretionary capital to invest but it’s not unlimited,” De Smet. “The amounts that are circulating are probably of another order,” De Smet added.

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              The UK’s combined defined contribution (DC) pension stood at £489 billion at the end of October, down by £18billion from September, according to Aon Consulting, the leading employee risk and benefits management firm.

              This is the biggest fall since February, and follows a period of rallying DC assets as a result of stock market increases.  However on a more positive note, earlier in the month combined DC pension assets reached a 16 month high of £520billion, a level not seen since June 2008.

              Aon’s monthly DC Pension Tracker measures the total asset value of UK workers’ DC pension accounts. It also tracks the income in retirement of individuals at different ages who contribute 10% of a £25,000 salary to a DC arrangement and have an existing fund (valued as at September 2007) of £15,000 for age 30 and £150,000 for ages 55 and above.

              Highlighting the current uncertainty being faced by UK workers as a result of equity market volatility, a 65 year old retiring on 31st October 2009 would receive an annual retirement income of £8,593. If the same worker had retired six months earlier (30 April 2009), they would have only received £7,133. This is the equivalent of over £120 every month, or £29,200 over the course of 20 years.

              Richard Strachan, senior consultant at Aon Consulting commented: “While October finished slightly down compared to September, the general trend for the UK’s DC pension savings is on the up. There is still significant volatility, though, and it is vital for workers to take an active interest in their retirement savings, evaluating whether they are invested in the right funds for them, and to have some very clear goals and a strategy to achieve them.”

              Flight to Perceived Safety

              According to separate research from Aon, British workers are increasingly investing their DC pensions in their scheme’s default fund, potentially as a result of the continued uncertainty in investment markets. The 2009 Aon Benefits and Trends Survey, which polled 650 companies across 13 sectors, revealed that the majority of employers are seeing more than 80% of their employees invested in the default fund.

              Strachan continued: “In turbulent economic times, it’s understandable that members are seeing the default fund as a safe haven.  However, the security of the default fund is down to those managing the scheme. To ensure that members are getting the cautious investment option they think they are, scheme investment, and the performance of default funds in particular, should be a priority for those running DC pensions.”

              “There is a trend towards increasing the number of investment options; however, too much choice will often lead employees to select the default option through fear or inertia.  Employers and trustees need to ensure that they offer an optimal number of investment choices.

              The key point is that employers and trustees must clearly communicate the options available if members are to make informed decisions that are right for their circumstances.”

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              WWF, the world’s leading environmental organisation and leading international insurer RSA Insurance Group (RSA) have today announced an international partnership. The three year agreement will focus on researching insurance risks of environmental change. RSA will also support major conservation projects around the world, while working with the WWF to become a more sustainable business.

              Key elements of the partnership include:

              • In December, during the World Climate Change talks in Copenhagen the need for a new global deal to reduce greenhouse gases will be discussed. RSA will be supporting the WWF’s major exhibition on risks to the Arctic region.
              • In the UK, RSA will be supported by WWF in working with the Thames River Restoration Trust in East London to recreate the natural flood plain, demonstrating how simple measures can decrease flood risk. Additionally, with the WWF, RSA will continue its work with the government and construction industry, looking at how flood protection can be incorporated into property design and where and how new properties should be built.
              • RSA is one of the world’s largest Marine insurers. Climate change is opening up new areas of the Arctic to resource extraction, commercial shipping and fishing. There are also challenges to the Baltic, Canadian and Scandinavian coastlines. RSA will be sponsoring research and mapping sensitive areas to help understand and mitigate these risks and to use resources in a more sustainable way.
              • China is an emerging market but growth on the scale currently experienced brings environmental challenges. The Chinese government recognises this and has committed to stretching new renewable energy targets.  WWF and RSA will be working together to research renewable energy and emphasise the role insurance can play in supporting the transition to a low carbon economy.
              • In the long-term, the partnership will be looking at developing and promoting products that provide incentives to customers for reducing their environmental footprint – for example, making their homes more energy and water efficient.
              • With WWF’s support, RSA will be setting new CO2 targets, researching its supply chain impact, developing new green products and investigating how RSA’s investment strategies can support sustainability.

              The world’s changing climate presents a new set of risks. WWF and RSA will work together to understand the risks in a changing world. The insurance industry is able to help customers understand the level of risk they face, underwrite that risk to give security and respond when the worst happens.

              David Nussbaum, CEO at WWF UK, said: “We look forward to the partnership driving low carbon investments in the financial sector, low carbon behaviour among customers, and a greater ability among businesses and homeowners to protect themselves against the increasing impacts from climate change.”

              Commenting on the partnership, Andy Haste, Group CEO at RSA said: “Behaving responsibly and ethically in the way we manage our business can have a positive impact on the environment, people and the communities in which we operate. The WWF is one of the world’s leading environmental organisations.  They work in nearly all of our markets and they’re one of the most recognised global brands.

              “During the course of this partnership we’ll be helping and learning from each other to understand more about environmental risks, to protect our business and customers while minimising the impact on the environment.”

              0 0

              Chinatrust Financial Holding Company said Tuesday it plans to buy a 30 percent stake in Taiwan’s Nan Shan Life Insurance Co. for 660 million US dollars.

              Taipei-based Chinatrust last month lost out in a bid to acquire Nan Shan from struggling American International Group, being beaten by a consortium led by China Strategic Holdings Ltd.

              Chinatrust said China Strategic had agreed to sell a 30 percent stake in Nan Shan in exchange for a 9.95 percent stake in Chinatrust, Taiwan’s largest bancassurance services provider.

              Under the terms of their memorandum of understanding, Chinatrust will sell 1.17 billion new shares to China Strategic, equivalent to a diluted 9.95 percent stake, for 20.8 billion Taiwan dollars (660 million US).

              Chinatrust said it would then buy 30 percent of Nan Shan from China Strategic for 660 million US dollars.

              The deal came after China Strategic, in a consortium with Primus Financial Holdings Ltd., acquired Nan Shan from AIG for 2.15 billion US dollars last month.
              Chinatrust chief investment officer Daniel Wu told reporters that his firm would appoint Nan Shan’s chief executive, and China Strategic would name the insurer’s chairman, though the appointments needed to be mutually agreed.

              The company said the 1.17 billion new shares were part of a planned private placement of 2.5 billion shares at 17.74 Taiwan dollars each.

              It said it expected to complete the entire transaction in the second quarter of 2010.

              Chinatrust Financial plans to raise its stake in Nan Shan to more than 50 percent within three years, Wu said. “We can raise (our stake) by buying in cash or through a share swap, or other alternatives, subject to agreement by both sides,” Wu said.

              Chinatrust said earlier that it was consulting with lawyers on why its offer to AIG was unsuccessful and that it was not ruling out taking legal action against the company.

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