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George Stobbart

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    The US Congress is “very close” to forging a compromise that will pave the way for remaking US health care, President Barack Obama’s top priority, House Speaker Nancy Pelosi said Wednesday.

    Pelosi, speaking after talks with Obama at the White House, said “it’s possible” the Senate and House of Representatives could meld their rival versions of the historic legislation by the end of the month.

    “I think we’re very close to reconciliation, respectful of the challenges

    — policy and otherwise — in the House and in the Senate,” she said, flanked by the chairs of key House committees.

    House Democrats were due to hold talks on Thursday to discuss the issue further.

    Senior lawmakers and staff in both chambers of the US Congress, spurred on by White House aides, have been working to reconcile the House and Senate versions of the bill, hoping to iron out key differences and send a compromise measure to Obama before his marquee State of the Union annual speech.

    Pelosi declined to detail specific disagreements or to say whether the House was prepared to accept key provisions of the Senate’s less-expansive approach to what would be the most sweeping overhaul of its kind in four decades.

    “It’s not a question of adopting this or that. It’s about addressing and meeting the needs of the American people — that this be affordable for the middle class, and to do that we have to hold the insurance companies accountable,” she said.

    Both measures aim to extend health care coverage to more than 30 million out of the 36 million Americans that lack it, end abusive health insurance company practices, and curb soaring costs that take giant bites out of family and government budgets.

    But the Senate stripped out a government-backed “public option” plan to compete with private insurers in order to win over the backing of a handful of centrist Democrats without whom the bill would not have secured the 60 votes needed to pass in the 100-seat body.

    Another potential obstacle is the House bill’s tougher restrictions on federal funds subsidizing abortions: While pro-choice lawmakers denounce the limits, some centrist Democrats say they will withhold support without them.

    The United States is the world’s richest nation but the only industrialized democracy that does not provide health care coverage to all of its citizens.

    As a nation, the United States spends more than double what Britain, France and Germany do per person on health care.

    But it lags behind other countries in life expectancy and infant mortality, according to the Organization for Economic Cooperation and Development (OECD).

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    Snow and ice has hit Britain, with more expected. The insurer MORE TH>N offer the following advice on surviving the cold.

    At home:

    • Leave your central heating running, not on a timer, but at a constant temperature (the coldest time is between 1am and 3am). If possible, leave it running in all rooms.
    • If you know you’re going to be away, either leave the heating on, or drain off your water and heating systems. If you have a property that is unoccupied, drain the system. To do this, turn off the stopcock, shut down the boiler and open all taps. If you’re unsure about the central heating, speak to a plumber. Remember to leave your insurance details with a friend or neighbour.
    • Check the lagging on your pipes and water tank – pay a visit to the loft if needs be. If you have enough constant heating in the house, it will prevent the water tank from freezing. The most likely effect of the sub-zero temperatures in the home will be frozen pipes and water tanks.
    • Bring pets indoors and if you have fish, leave something floating in the middle of your pond – ie a ball. When you want to get air to them, lift up the ball.
    • Keep a supply of batteries, torches and provisions.
    • If your home loses power – keep the freezer door shut.

    All MORE TH>N customers have access to a free-phone 24 hour help-line as part of their standard home insurance policy. In the event of a household emergency customers can ring the help-line 24 hours a day, 365 days a year.

    Pete Markey, spokesperson for MORE TH>N comments: “We are prepared to help with the cold front with many of our staff ready to help out in the affected areas and customers can rest assured that should the worst happen, we are here to help them around the clock.”

    In the car:

    Cold weather can play havoc with cars. Flat batteries are the main cause (32%), followed by cars turning over but won’t start up (15%). In fact motorists are 50% more likely to breakdown in January, February and March when temperatures are often colder, than any other month of the year.

    MORE TH>N’s advice to motorists during freezing weather conditions:

    • During the current bad weather, only make journeys if they are absolutely necessary. You can check weather conditions through the Met Office www.metoffice.gov.uk
    • Slow down during bad weather, everyone will be in a rush to get home, but breaking distances are longer during wet conditions, and even more so in ice or snow.
    • If you are driving during bad weather, stick to main roads as these are more likely to be gritted or maintained than side and minor roads.
    • If you have an iPhone, download MORE TH>N’s free Car Claim app. Should you have an accident it will provide you with safety tips as well as prompting you to gather the necessary information from the scene.
    • During cold weather its especially important to check tyre, battery and wiper blade condition. Make sure the lights are fully functioning and double check oil and fuel levels before setting off. Tyre tread should be at the very least at 1.6mm (the legal minimum) it is best to have them at around 3mm for best grip on the roads.
    • Keep water, blankets and a first aid kit in you car, for emergency situations.
    • Check anti-freeze levels and carry de-icer in case the locks freeze
    • For cars that are not being used that often ensure you regularly turn the engine over and keep the engine running to keep the battery energised
    • If warming your car up don’t leave it unattended with the keys in the ignition. Many cars are stolen this way by opportunist thieves each year.
    • Take your breakdown telephone help-line number and mobile phone with you on all journeys
    • It’s also useful to keep a torch, ice scraper – and in extreme weather conditions wellington boots and a shovel in your car

    Above all, Brits affected by the extreme weather circumstances should keep a close watch for further weather warnings (also announced on News-Insurances.com), and heed the advice of the emergency services.

    See also :

    Property owners at risk from serious water damage claims

    All you need to know about flood and natural disaster insurance

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    Two changes to EU VAT rules threaten the huge savings made by European insurers who have been off shoring much of their back office administrative processes to low-cost locations such as India. Services facing tax increases of upwards of 25% include: offshore administration, call centres, claims processing, accounting and finance etc.

    These potential losses are the unintended consequence of attempts by Brussels to simplify VAT and curb billions of pounds lost to fraud.

    EU VAT Package 2010

    The first change is a European-wide shift in the rules on determining which country’s VAT rules apply when providing any back office service, the ‘place of supply’.  From 1 Jan 2010, the place of supply changes from where the service is provided to where it is consumed.  For example, for offshore insurance services provided from India, the VAT territory would now become the UK.  The outcome of this would be the UK insurer having to account for the VAT bill.  Since insurance and other financial services are exempt for VAT in Europe, this would leave the insurer with a big VAT irrecoverable cost of 17.5%, being the UK VAT rate from 2010.  Given the high value of services now provided from India and elsewhere to the insurance market, this VAT would potentially run to several hundred million pounds for the insurers as a cost of off shoring.

    The best organised insurers have tried to create VAT Grouping structures in the UK, whereby other related companies can offset this type of irrecoverable VAT liability stuck with the exempt insurer.  However, this is also under threat too from the EU.

    Brussels censers UK and others on VAT Grouping rules

    The EU in Brussels, which sets the VAT rules for the region, is now targeting some of the abuses of the VAT Groupings rules which would undermine some of the strategies adopted above to help avoid unwanted VAT.  In November 2009, the European Commission gave warning to the UK (Spain, Czech Republic, Ireland and Denmark) to change their rules.

    This censurer from the EU in terms of insurance is the bringing into VAT Groups companies which are not fully bound to one another, a principle requirement of the EU VAT Directive, to enable the offsetting of VAT.  This means that many insurers hoping to avoid the VAT losses on their off shoring activities which have arisen from the new EU VAT Package (above) will lose their main avoidance strategy.

    Richard Asquith, MD of TMF VAT & IPT Services commented : the 2010 VAT Package has been a long time coming, and many insurers had been changing their offshore VAT arrangements in anticipation of potential cash losses from irrecoverable VAT.  However, this new challenge to the VAT Grouping rules will undermine many of these efforts. It is likely that the UK will have to respond to the Commission by Spring, which gives little time for the insurers to recalibrate their business organisation.

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      As 2010 begins, some people could start the New Year as a time to start planning for the retirement they would like.  The long term savings provider believes by setting realistic goals and seeing retirement as an ongoing process rather than an event, people can move closer towards the goal of maintaining their ideal lifestyle in retirement.

      A recent study commissioned by Friends Provident revealed the younger generation is already starting to think along these lines by using a range of savings options to fund their retirement – almost two thirds (57%) of 21-29 year olds plan to use property and 43% prefer the flexibility of an ISA.  But Friends Provident is warning this may not be the case across all generations.

      Martin Palmer, head of corporate pensions marketing at Friends Provident says: “It sounds obvious but taking simple steps to work out the sort of retirement you want, could be half the battle. Only once you have done this can you start planning properly with your IFA how to best reach those goals.  For many people a ‘retirement career’ is an attractive way of keeping a moderate income in retirement, whereas for others the plan could be to move abroad – either way, careful advanced planning is required along with a dose of realism. The first step for anyone should be to check whether their current savings are sufficient for the future.”

      Top ten saving tips for the New Year are as follows:

      1. Check how much you have currently saved for retirement. Talk to your IFA or pension scheme provider(s) to get information, and if you have had more than one employer you should track down what pension entitlements you may have earned from your time in employment. Many company pensions are provided through specialist providers who you can contact directly about the benefits you may have earned. It’s also vital to understand what form any company pensions take – are they defined benefit schemes where the amount you will receive is ‘guaranteed’, or defined contribution schemes, where the pension that will be paid is based on the value of your investments when you come to retire? Understanding what you have earned so far is a big step towards saving enough for retirement.

      2. Request a state pension forecast from the Department for Work and Pensions (DWP) and consider if it is worth paying in backdated NI contributions for either yourself or your spouse. If you or your partner are self employed or earn very little, it might be worth considering what NI contributions you pay since some are eligible for a rebate but still provide an entitlement to the state pension at retirement. An IFA or your accountant would be able to help you.

      3. Do your homework and swot up on the rules. For example, few people realise that they can receive a greater state pension if they elect to delay receiving the payments by a year – and this holds true for many defined benefit schemes as well. If you can take advantage of private pension provision to provide the income to fund retirement while working part time, you can delay vesting other benefits which will mean they will ultimately pay out more. Similarly, many schemes allow a tax-free lump sum to be withdrawn after the age of 50 (this will be increasing to 55 from April 2010). Again, it’s worth understanding the different types of pension scheme you have to see if this is worth doing – for defined contribution schemes it’s generally a great idea to take as much tax free cash as you can, whereas for defined benefit schemes the calculation is harder since you sacrifice income at a different rate. If you have many pensions, consider maximising the cash from defined contribution schemes but taking 100% income from defined benefit schemes. Again, an IFA would be able to help you make this decision.

      4. Use the free tools on offer to you – an IFA or employer should be able to help with the particulars of the type of pensions you have but for general help, the Financial Services Authority (FSA) produces a jargon free guide to retirement options at www.moneymadeclear.fsa.gov.uk.

      5. Ensure your pension scheme providers have your up to date contact details especially if you have had more than one pension scheme over the years. Don’t assume that when you reach retirement, that all your pensions kick in automatically. For occupational schemes, the Pensions Register runs a tracing service – just call 0845 600 2537. For private schemes, you will need to get in touch with the financial organisation that you took the scheme out with.

      6. Consider what type of income you want in retirement e.g. income drawdown or annuity, and whether you may qualify for an impaired annuity.

      7. There are courses available to help people prepare for the impact that retirement has on their life. The earlier you can plan for retirement, the better your finances and the better your health!

      8. To move towards a more financially secure retirement, people over 50 should aim to pay off any unsecured debts and consider over-paying on their mortgage to be debt and mortgage free as quickly as possible. Rationalise your monthly outgoings – getting rid of your mortgage is the biggest step to reducing this but in the current climate few are able to afford such a step but even small cutbacks will help to boost your pension pot.

      9. Generally, if you start taking income from a pension earlier than intended then the annual income you will receive will be lower, whereas if you delay you will receive higher income payments.

      10. Finally, take a look at somebody that you know who has retired, and see if you want to aspire to, or improve upon the financial lifestyle that they have.

      Martin Palmer concludes: “These tips may sound simple but saving for retirement does not need to be complicated. Advanced retirement planning ensures long-term security – it doesn’t need to be rocket science.”

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      A third of all UK motorists admit to driving without being able to see out of their windscreen properly during wintry weather, a situation which could see many car insurance claims over the coming weeks.

      Tim Bailey, safety expert at Continental Tyres, said
      research by the company found many people were in “too much of a rush” to clear the windows properly before setting off on a journey, but this could be extremely hazardous behaviour.

      He commented: “Preparation is key when setting out in your car, especially during the winter months. It is essential to be able to see and be seen.”

      Elsewhere, the Institute of Advanced Motoring recently also highlighted the risks of poor visibility.

      It noted motorists should look to clean their windscreens on both the inside and outside, as a thin film of grime and grease will be deposited there by heaters sucking in air and fumes from the road outside.

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      Lee Venamore of SterlingSterling Insurance Company has appointed Lee Venamore as a Regional Development Manager.

      Reporting directly to David Sweeney, Director – General Insurance, Lee will be responsible for developing relations with Brokers based in the South East region, as well as working with the new business underwriters to further develop the teams’ sales capability.

      Director, David Sweeney said: “Lee brings with him a wealth of expertise across underwriting, sales and marketing disciplines as well as expertise of the South East broker market.  He is a fantastic addition to the team and his knowledge will put us in good stead to look after a very valuable market sector.”

      Lee joins Sterling from Allianz Insurance where he spent 10 years in various Underwriting, Sales and Management roles. He is President of the Mid Kent region of the Chartered Insurance Institute and outside of work Lee enjoys playing golf, going to the gym, and spending lots of time as a football referee where he officiates in the Conference Premier.

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      Singapore’s United Overseas Bank (UOB) said Wednesday it will sell its insurance business to British insurer Prudential in a cash deal worth 428 million Singapore dollars (306.4 million US).

      Upon completion of the deal, expected on January 31, UOB Life Assurance will cease to be a subsidiary of UOB, the Singapore bank said in a statement.

      UOB will then enter into a bancassurance agreement with Prudential to distribute various insurance products from the British insurer in Singapore, Indonesia and Thailand for at least 12 years, it said.

      “The tie-up allows us to leverage our distribution strength and harness the manufacturing expertise of a leading life insurer, to jointly accelerate the growth of our bancassurance business regionally,” said UOB chief executive Wee Ee Cheong.

      “We are delighted to have Prudential as our partner in this development and look forward to working together to deliver greater value to our customers and our stakeholders.”

      Tidjane Thiam,  Prudential Plc group chief executive, said the bancassurance agreement with UOB “offers us significant new profitable growth opportunities in Singapore and Indonesia.”

      It also “substantially increases our scale in Thailand, a key market in the region,” he said.

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      President Barack Obama and his top allies in the Congress worked Tuesday to map the way to enacting a sweeping overhaul of US health care by his annual marquee State of the Union speech, now weeks away.

      Obama and the Democratic leaders of the Senate and House of Representatives were to discuss their final drive to pass the legislation, his top domestic priority, in talks at the White House set for 5:45 pm (2245 GMT).

      The high-stakes discussions, at the dawn of a mid-term election year expected to see an erosion of the Democrats’ House majority, aimed to chart the best way for the two chambers to reconcile their rival versions of the bill and approve a final compromise that the president could sign into law.

      Both bills aim to extend health care coverage to at least 31 million Americans out of the 36 million who currently lack it, while banning abusive health insurance practices and curbing skyrocketing US medical costs.

      Passage would hand Obama and congressional Democrats a huge victory ahead of November elections that, if history is any guide, are likely to result in sizeable Republican gains in Congress.

      With Republicans locked in unyielding opposition to the plan, Obama and his top legislative allies looked for ways to tamp down bitter intra-Democratic feuds that still clouded the fate of the legislation.

      A headline battle looms over the provision of a government-backed “public option” to compete with private insurers — a core component of the House version that Senators stripped from their less expansive bill.

      Another potential obstacle is the House bill’s tougher restrictions on federal funds subsidizing abortions: While pro-choice lawmakers denounce the limits, some centrist Democrats say they will withhold support without them.

      Democratic House Speaker Nancy Pelosi was to meet at 1 pm (1800 GMT) with Democratic committee chiefs in the House, amid an insurrection on the party’s left-flank at the Senate’s watered-down version of the bill.

      Later, Pelosi and Democratic House Majority Leader Steny Hoyer were to attend the White House talks in person while Democratic Senate Majority Leader Harry Reid and his deputy, Senator Dick Durbin, were to join by telephone.

      Democrats say they want final passage before Obama’s State of the Union speech, which Pelosi has suggested could slide to early February from its typical late January date.

      The House approved its version of the bill on November 7. The Senate adopted its version December 24.

      “Difficult work does remain,” Obama communications director Dan Pfeiffer said in a post on the official White House blog.

      But “the reality is that the two versions of reform legislation are vastly similar — built upon a shared foundation that will provide stability and security for Americans with insurance, affordable options for those without, and lower costs for families, businesses, and the government,” he added.

      According to media reports, Democrats may look to blunt Republican delaying tactics by skirting the traditional “conference” in which formally appointed delegates from each chamber meet to work out a final compromise.

      Instead, key lawmakers and top White House officials would put together a final plan from the House and Senate version in informal talks sometimes known as “ping-pong” because the process can include the two chambers sending bills to each other until a final compromise is achieved.

      Democrats have virtually no margin for error: The Senate’s Christmas Eve vote rallied exactly the 60 votes needed to pass the bill, and some centrists have said they will oppose any major changes.

      The United States is the world’s richest nation but the only industrialized democracy that does not provide health care coverage to all of its citizens.

      As a nation, the United States spends more than double what Britain, France and Germany do per person on health care.

      But it lags behind other countries in life expectancy and infant mortality, according to the Organization for Economic Cooperation and Development (OECD).

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      Prudential Financial, today announced that it has completed the sale of its minority joint venture interest in Wachovia Securities Financial Holdings, LLC, which includes Wells Fargo Advisors (formerly Wachovia Securities) to Wells Fargo & Company.

      At the closing, Prudential received $4.5 billion in cash.

      In addition, Prudential received $418.4 million in payment of the principal and accrued interest on a subordinated promissory note that Wachovia Securities had issued in connection with the establishment of the joint venture.

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      Torus, the global specialty insurer, has named Jackie Richardson as SVP, Head of Global Human Resources, starting today. Reporting to Global Chief Operating Officer, Naveen Anand, Ms Richardson will implement and lead the Human Resources strategy for the Group worldwide.

      Mr. Anand said: “This is a new and important senior management role so we are delighted that Jackie, who brings a wealth of global human resources expertise, has joined. Her experience in workforce development, talent management, employee relations, training, and organisational design and development, especially in the insurance industry, will help us continue to attract, develop and retain talented people around the world as we continue to grow.”

      Ms Richardson said: “I am excited be a part of Torus in taking on the responsibility of recruiting, retaining and developing the Group’s most important asset – its people. It’s great to be joining an organisation that understands the true value of its human capital and believes in the alignment of business growth and development with employee growth and development”.

      Ms Richardson joins Torus from Synovate, a global market research firm, where she was Executive VP, HR for The Americas. She has over 20 years of experience in Human Resources in the insurance industry, her most recent role being Vice President for Property and Casualty HR at CNA, where she oversaw HR strategies for their P&C operations globally. In addition to an undergraduate degree, she holds a Master’s Degree in Counseling and Consulting Psychology from Harvard and her professional credentials include the successful completion of the Human Resources Executive Program at the University of Michigan’s Ross School of Business.

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      XL Insurance announced the appointment of two financial institutions underwriters to its London-based Professional Lines team.

      Senior Underwriters Gerard Bloom and Neale Stevenson will offer specialist professional liability coverage for financial institutions such as hedge funds, asset managers and banks.

      Gerard Bloom will head the new financial institutions underwriting team. He has more than 15 years of experience in European professional lines insurance and joins from Zurich Financial Services, where he was Senior Vice President for Mergers & Acquisitions. Prior to his role at Zurich he was UK & Ireland Chief Underwriting Officer for Financial Institutions at AIG.

      Neale Stevenson has worked in the insurance industry for more than 20 years, most recently heading the Financial Institutions team at Liberty International Underwriters in London. He joined Liberty from SVB Syndicates.

      Commenting on the appointments, William Wharton, Chief Underwriting Officer Professional Lines UK at XL Insurance, said: “Many financial institutions, including some that are well managed, were impacted by the recent financial crisis, demonstrating the importance of professional liability coverage for even very experienced managers.

      “We are looking to expand our business portfolio for financial institutions and believe that our clients are best served by a dedicated team of underwriters focusing purely on these specialist risks.”

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      Aviva Investors, the global asset management business of Aviva has agreed to buy 100% of River Road Asset Management (“River Road”), a leading value-oriented US equity manager based in Louisville, Kentucky, with US$3.6 billion assets under management (as at 30 November 2009).

      This acquisition supports the expansion of Aviva Investors’ third party institutional asset management business by combining its existing expertise in fixed income in North America with River Road’s equity investment capability.

      The management team and the integrity of River Road’s investment process will remain unchanged. River Road will benefit from access to the fixed income capabilities, financial strength and global presence of Aviva Investors.

      River Road, which has gross assets of US$6 million* (as at 31 December 2008), will continue to be based in Louisville and will form part of Aviva Investors North America (“AINA”), which is headquartered in Des Moines, Iowa. AINA also has offices in New York, Chicago, Manhattan Beach, California, and Toronto, Canada.

      Alain Dromer, chief executive of Aviva Investors, said: “In River Road, we have found a top-quality equity management business with an impressive track record. It has an experienced team, a strong customer focus and a scalable operating model. River Road will contribute significantly to our plans to increase our third-party institutional business and will help us provide our clients with a broader range of investment solutions.”

      The transaction is expected to complete by the end of the first quarter.

      * US GAAP

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      Tina ShortleAXA Insurance has appointed Tina Shortle to a new role of Marketing Director, leading the development and implementation of all of AXA’s general insurance’s marketing activities across both its direct and intermediated product suite.

      Tina brings a whole wealth of experience. She was a founder member of the Swiftcover team and was instrumental in launching the first on-line motor insurance brand in the UK, creating an insurer that challenged the status quo and became the fastest growing motor provider in the country. More recently, she was Marketing Director of Swiftcover and also of AXA’s growing direct business, where she looked after both the household and travel product lines.

      Prior to joining Swiftcover in 2004, Tina was head of marketing at Churchill Insurance from 1998 to 2003. She was also responsible for marketing consultancy on behalf of Churchill’s corporate partners and marketing activity for Prudential Insurance.

      Tina took up her new role on 1 January 2010.  She will be reviewing marketing activity across AXA Insurance during the first few months of the year and will update on overall marketing strategy once that process is completed.

      Philippe Maso, Chief Executive, AXA Insurance said: This new role provides a central focus for marketing and reinforces our view that marketing activity is critical for success in the retail segment of the market. Our multi-channel approach to customer delivery is key to our on-going strategy and Tina’s wealth of experience particularly in the areas of direct marketing, brand building and digital communications will help us enhance our customer reach across the board.”

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      Zurich Financial Services appoints Mark Coffey to the position of head of personal lines, broker division, UK General Insurance.

      Mark Coffey who has already started in the role reports into Richard Coleman, director, personal lines and SME.

      Richard Coleman said “I am very pleased to be able to announce the appointment of Mark Coffey as the new Head of Personal Lines. Mark has extensive experience in the personal lines arena with Zurich, and in recent years worked closely with the personal lines business in his role as Head of Key Accounts. Mark’s skills and knowledge will bring a huge amount to this highly important role which is a key business in our broker division.”

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      Reinsurance rates across most lines of property catastrophe business declined at the January 1, 2010 renewal, according to a briefing released today by Guy Carpenter & Company, LLC.
      The report, Rates Retreat as Capital Rebounds: Global Reinsurance Renewals at January 1, 2010 shows Guy Carpenter’s World Catastrophe Rate on Line (ROL) Index declining by six percent at the January 1, 2010 renewal, as the reinsurance market recovered and swiftly recapitalized in the wake of the global financial crisis and large reduction in catastrophe losses.
      The report covers regional developments as well as key influences and trends, such as catastrophe bonds and mergers and acquisitions activity. Both the report and downloadable charts are available at www.gccapitalideas.com.

      US property catastrophe

      Risk-adjusted catastrophe prices in the US decreased by an average of six percent, though the picture is somewhat complicated by recent adjustments to catastrophe models that have decreased predicted losses for earthquake and wind perils. Factoring in modelling adjustments, rates declined by as much as 11 percent on average.
      The significant exception to the general downward trend in pricing is programs with significant tornado/hail exposure in the middle of the US. Many of these programs sustained losses in 2009, and as margins traditionally have been very competitive, pricing has adjusted upward in response to the loss activity.

      European property catastrophe

      Catastrophe pricing in Continental Europe was flat to 5 percent lower, despite a number of localized losses in a year of above-average weather-related events.
      Windstorm Klaus, which hit France and Spain in January, was the region’s most severe weather event, causing first layer prices of programs in France to rise by ten percent on average. Overall, weather-related catastrophe activity in Europe was above average.
      Austria’s severe hailstorms led to a fourth successive year of frequency losses that resulted in restricted capacity and price increases of up to 20 percent to 30 percent.

      UK property catastrophe

      UK property catastrophe rates declined between 5 percent and 10 percent, while risk excess prices were flat to down 15 percent, subject to loss experience.
      The UK continues to be an attractive market to reinsurers due to its profitability over time. Though UK property catastrophe supply tends to be finite, a number of new markets entered to supply fresh capacity.

      Retrocession

      Treaty retrocession saw a modest increase in capacity, as two new underwriters in the Lloyd’s and Bermuda markets entered the market, while a number of existing underwriters showed an increased appetite.
      Primarily because of satisfactory capacity and changes to the catastrophe models, industry loss warranty (ILW) prices fell by as much as 30 percent, though there were few major purchases due to the focus on Ultimate Net Loss (UNL) placements by clients.
      Several potential new suppliers are poised to enter the market should a large loss turn pricing significantly.

      Casualty

      Rates for US casualty lines were flat to down 10 percent over the past two renewal cycles. Some pockets of resistance existed, with rates for financial institutions professional indemnity, particularly in London, showing single digit increases.
      In Europe, motor liability reinsurance rates continued to experience flat to 10 percent increases on working excess layers, depending on experience.
      Underlying concerns about increases in loss cost projections, due principally to medical care inflation, have been offset by the wide availability of excess reinsurance capacity.
      Underlying insurance rates for product liability are largely unchanged, but the effect of the recession has reduced turnover in most sectors except pharmaceuticals and medical devices, which in turn impacted reinsurance revenues on the main commercial/industrial liability placements.

      Aviation and marine

      Rate changes for aviation risks were essentially flat. Increases were largely dependent on size of loss, exposure changes and overall program premium banks.
      Some aviation sectors (such as commercial helicopters) faced increases following a spate of losses, while others (such as good quality corporate aircraft risks) continued to see reductions.
      Marine rates were down by an average of five percent. Capacity is growing and ample, with widespread price-cutting, particularly for non-Gulf of Mexico business. Absent any significant losses, downward pressure on marine rates is expected to continue into 2010.

      Other key trends and influences

      Eighteen new catastrophe bond issues came to market in 2009, easily exceeding the ten issues reported in 2008. The cat bond market will continue to provide an increasingly attractive and worthwhile supplement to sponsors’ risk transfer programs in 2010.
      Mergers and acquisition (M&A) activity – both tactical and strategic – regained some momentum in 2009, as insurers turned to the capital markets to address a wide range of strategic and tactical needs.
      Macroeconomic trends exerted a substantial effect on reinsurance capital and pricing, with asset-side movements and investment returns the greatest drivers of sector profitability and capital adequacy in 2009.
      Since 2005 most carriers’ earnings have been enhanced by reserve releases, particularly in accident years. This trend is not expected to continue, however, and a number of indicators point to a declining benefit from reserve releases in the future.
      Inflation could become an issue over the longer term, particularly for longer-tail writers whose premiums written today may be less able to cover inflated claims in the future.

      Chris Klein, Global Head of Business Intelligence, Guy Carpenter comments “A combination of factors – including the rally in global financial  markets, relatively low catastrophe losses in 2009 and lingering recessionary effects on demand – has resulted in an excess of supply and heightened competition at this year’s January 1 renewal.
      As a result, what we saw was an unusually slow renewal, in which a number of contracts did not close until very late in the season, as buyers sought to gain maximum pricing advantage.” “As we move into 2010, it’s safe to say that the property casualty reinsurance market has weathered the global financial crisis and emerged in a relatively strong position, with abundant capital and ample capacity for most lines of business.
      At the same time, the environment in which reinsurers operate will continue to be influenced by global economic conditions as much as underwriting decisions, and these macroeconomic factors will continue to warrant close attention.”

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      Simon Challinor, Canopius thumbCanopius Managing Agents, the largest privately-owned Lloyd’s insurance business, today announces that it has extended its portfolio of specialist construction products with the addition of construction and engineering insurance cover. Simon Challinor has been appointed as class underwriter to establish and develop the new product.

      Simon, who was most recently with Endurance, joined the insurance industry in 1980. During his 30 years underwriting construction and engineering insurance, he has worked for a number of insurers specialising in this sector including Commercial Union, the Ajax/Poland syndicate at Lloyd’s, Eagle Star and Gerling.

      Target segments for the new book of business include infrastructure, buildings and power generation. Products will include contractors all risks and erection all risks – including public liability, advance loss of profits, contractors’ plant and existing property – as well as machinery breakdown and business interruption. The account will seek quality clients and risks worldwide (ex North America) with particular focus on UK, Europe, Latin America, Middle East and Australia.

      Simon’s construction and engineering insurance account will complement the existing construction insurance and reinsurance currently written by Canopius, which includes offshore energy and marine vessel construction, project cargo, construction professional indemnity and engineering reinsurance.

      Tim Carroll, Underwriting Director of Canopius, said: “The construction and engineering insurance market is an area which Canopius already knows well. We believe that significant opportunities now exist in construction and engineering insurance with demand underpinned over the next five years by planned economic regeneration and stimulus efforts. The appointment of Simon, who brings with him some 30 years of underwriting experience in this highly technical sector, means Canopius is now well placed to capitalise on those opportunities and expand its presence in the construction industry, enabling us to offer a broader product range to meet our clients’ requirements.”

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      Aviva Canada announced today that broker connectivity with the Aviva Portal will be enhanced via Applied Systems’ WARP solution. The new functionality is now available for all Aviva personal lines business transacted in Ontario, the West and Atlantic regions.

      By interfacing with WARP, Aviva is giving its broker partners who use TAM® (The Agency Manager®) quick and easy access to its Portal.

      Debora Hendrickson, senior vice president operations, Aviva Canada said: “We’re serious about enhancing broker connectivity and we continue to find ways to make it easy for brokers to do business with Aviva”. “We know that our brokers are looking forward to the improved connectivity that WARP offers.”

      WARP is a bridging solution that connects users of TAM to insurance company systems. For the Aviva implementation, the WARP technology seamlessly connects brokers to the Aviva Portal and the Aviva Document Management System where they can process policy inquiries and manual endorsements. Aviva brokers can learn more about the WARP functionality by visiting avivapartner.ca.

      Doug Johnston, Applied Systems vice president of partner relations & product innovations said: “Ease of doing business is critically important in broker operations, and Aviva’s implementation of WARP provides a fast, seamless and secure link between TAM and the related information within Aviva”. ”The embedded [Aviva] transactions within the policy files are fully integrated with TAM’s activities and tracking, providing both the efficiency and ease required in today’s businesses.”

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      China Life Insurance Co. will prepare its 2009 annual financial reports under China’s new accounting rules.

      The company said in a statement Thursday evening that it received a notification from the Ministry of Finance that requires insurance companies to adopt new regulations regarding the accounting treatment of insurance contracts.

      China Life Secretary Heng Kwoo Seng said in the statement: “The implementation of the above mentioned regulations will significantly affect the company’s accounting policies”.

      However, the company didn’t say how its 2009 results will be affected by the new rules.

      Under the rules, income from investment-type insurance products, which accounted for a large proportion of the premium income of mainland insurers over the past few years, won’t be booked as premium income.

      The Ministry of Finance said earlier that the new accounting rules were aimed at integrating China’s accounting system with international standards.

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      Old Mutual has confirmed the appointment to the Board of Directors of its new Chairman, Patrick O’Sullivan, with effect from 1 January 2010.  Chris Collins, the former Chairman, retired from the Board on 31 December 2009.

      Julian Roberts, Group Chief Executive of Old Mutual, commented: “We are delighted that Patrick has joined us as our new Chairman following the retirement of Chris Collins.  We thank Chris for his guidance and management of the Board throughout his tenure and particularly during the extraordinarily tough market conditions of the last 18 months.

      ‘Patrick brings with him considerable experience of international financial services groups and restructuring and I look forward to his counsel and contribution to the future development of the Group in building long-term shareholder value.”

      In accordance with Listing Rule 9.6.13, the following directorships have been held by Patrick O’Sullivan in other publicly quoted companies during the past five years:

      • Man Group plc (non-executive Director – current)
      • Bank Of Ireland (non-executive Director – current)
      • Collins Stewart plc (non-executive Director – ceased December 2009)
      • Zurich Financial Services Group (executive Director – ceased April 2009)

      There are no other matters for disclosure under Listing Rule 9.6.13 relating to Mr O’Sullivan.