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Thomas Hickey

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Unpaid hours equivilant to a million extra jobs in 2011

Good to know

Jan 5, 2012

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The total unpaid overtime worked by Brit’s last year is the equivalent of over a million full time jobs, the Trades and Union Congress (TUC) reported on Thursday.

According to the TUC, Brit’s worked around two billion hours of unpaid overtime last year, worth around £29.2 billion to the UK economy.

The TUC took the occasion of the findings to announce the date of this years ‘Work Your Proper Hours Day’, on February the 24. The day is a light-hearted campaign to call on employers to thank staff for the extra hours they put in.

Findings by the TUC also revealed that keeping workers back isn’t always the most productive method for an employer. Often employers pressure their workers to stay longer hours, but taking on extra employees is more efficient and creates much needed jobs for the UK economy

TUC General Secretary Brendan Barber said, “The heroic amount of extra unpaid hours put in by millions of workers make a vital – but often unsung – contribution to the UK economy.

“While many politicians and financial institutions have spectacularly failed to do their bit to help the UK economy, millions of hard-working staff clearly have and we hope employers congratulate them for their efforts on Work Your Proper Hours Day this year.”

The number of workers doing unpaid overtime has increased by more than a million since records began in 1992, when 4.2 million people regularly did unpaid overtime, to 5.3 million people in 2011.

“…while many of the extra unpaid hours worked could easily be reduced by changing work practices and ending the UK’s culture of pointless presenteeism, a small number of employers are exploiting staff by regularly forcing them to do excessive amounts of extra work for no extra pay,” Barber said.

“This attitude is not only bad for workers’ health, it’s bad for the economy too as it reduces productivity and holds back job creation.”

Insurers using ‘opt out’ loopholes in policies

Legal

Jan 5, 2012

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More and more travel insurers are opting out of covering clients when a medical condition arises after purchasing the policy.

Customers who take out a policy then have their conditions change before departing on their trip are often being told to pay a higher premium or lose their coverage, even though they already have a signed and paid for a policy, Which? reported.

Insurers are able to this because, although the customer is committed to a policy once they buy it, many insurers include “ongoing medical warranties” in their policies which give them the option to leave if they no longer want to insure the client.

This is despite the Financial Ombudsman Service (FOS) ruling eight years ago that it is unfair for insurers to do this. The FOS said that it is only reasonable for an insurer to opt out of insuring a client if there was a change of circumstances “so fundamental that the risk being insured [becomes] completely different”.

Not all insurance companies are including ongoing medical warranties in their policies. Some of the companies Which? found that didn’t use them included AXA Insurance, Freedom Travel Insurance and Miaonline.co.uk. These companies said they would continue to insure a customer if a GP is OK with the trip going ahead.

According to Which?, the FOS is now receiving more complaints about the issue than ever before; about 40-50 complaints every month up from about 20 a month three years ago.

Which? said that The Association of British Insurers is currently carrying out a review of travel insurance products to improve issues such as this.

As the storm calms the costs to insures becoms evident

Good to know

Jan 5, 2012

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As the weather begins to relax across most parts of the UK today, the damage from the weeks storms is becoming more obvious.

It was a destructive and costly start to the year and most insurers reported big increases in the amount of claims. News Insurances had a look at what different insurance companies were reporting about the storms.

Direct Line

Direct Line Insurance recorded a 300% increase in claims for the first 3 days of January compared to an average year. They also reported that nearly half of these claims were related to roof damage.

AA Insurance

AA yesterday announced that their claims rates have doubled, but they noticed a particular jump in roofing claims which jumped twelve-fold in the last few days. They said that other common claims included windows broken by falling tree branches or roof tiles as well as gutters and aerials.

They also noticed a stark increase in car insurance claims resulting from flying debris. A classic case for a storm provoked car insurance claim, AA said, was driving through standing water and checking the engine only to have the bonnet blow off and smash the windscreen.

Co-operative

The Co-operative was another company to report larger than usual figures. In the first four days of 2012 they had received more claims than they normally would in the whole of January.

While the effects of the storm on different companies vary slightly, they all issued the same warnings – don’t drive unless you need too, clear hazardous loos objects from around the house, keep up repairs on the house when safe to do so, and keep your car in the garage to protect it from flying debris. If something does happen, notify your insurer as soon as possible to make sure the claim process runs smoothly.

Lorica Insurance Brokers strong start to 2012

Social

Jan 5, 2012

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Lorica Insurance brokers has continued last years strong expansion by announcing four new starters for 2012.

The new recruits are:

Nick Ellson – Branch Sales Director at Birmingham Branch from 3^rd January. Previous role was at Bluefin Insurance.

Ann Beswick – Group Operations Manager at Preston Branch working for Head Office starting 5^th January. Ann was previously Head of Underwriting Service at Groupama in Manchester.

Mark Partington – Branch Sales Director at Preston Branch on 5^th January. Mark was previously Executive Director at R K Harrison and has also worked at HSBC.

Antony Jones – Account Director of Property will join Birmingham Branch on 1^st February. Antony was previously at Adler Insurance Brokers.

The Hempstead based broker expanded their business at the end of last year as well, announcing three new hirings in the last two months of 2011.

Matthew Bray CEO said ‘’It is great to start the New Year with so many key hires for our business. We are looking forward to working with them all and to their contribution to our ambitious plans. These high calibre individuals will be an asset and add to the hugely talented employee base we have.”

2011 most expensive natural catastrophe year ever

Jan 5, 2012

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Stronger and more frequent natural disasters in 2011 made it the most expensive year ever for natural catastrophe losses, Swiss Re announced.

Last year’s natural catastrophe bill for the global economy of £244 billion dwarfed the previous most costly year of 2005, at around £141 billion. Insured losses last year came in at £105 billion, the reinsurance company reported.

The record prices can be almost solely pinned on large earthquakes in Japan and NZ. While there was no dramatic increase in the amount of quakes reported, it was the scale of last years quakes that broke the bank. Over the past three decades geophysical events accounted for just under 10 per cent of insured losses, but last year this figure was around 65%.

The most expensive single event was the Japan earthquake and tsunami. While the earthquake which triggered the wave was the biggest in Japanese history, it’s damage was relatively minimal compared to the tsunami. The wave reached a height of up to 40 meters in some areas and washed away entire towns, killing around 16,000 people.

The economic cost of the earthquake and what followed was £135 billion and the insured losses amounted to £26 billion, the most costly single event of all time.

The earthquakes in New Zealand were another big one. The February quake killed 181 people, destroyed buildings and had an insured cost of around £8 billion. Then the day before Christmas dozens were injured again with three more strong quakes.

Perhaps the most costly weather related natural catastrophes was the floods in Thailand. While Thailand is used to getting heavy rainfall in the wet season, a La Niña phenomenon caused the rain to be much heavier and last much longer. 800 people lost their lives and hundreds of thousands of houses were flooded.

The main financial cost was the effect the floods had on Thailands computer production industry. Thailand produces around 25% of the world’s supply of components for computer hard drives, and this was directly effected by the floods and cost the economy tens of billions of dollars.

The Thailand floods and the Japan earthquake contributed to an unusual geographical spread of disaster costs. Asia bared an unusual large amount of the disasters, with 70% of economic losses relating to natural disasters coming from the region.

BIBA launches new ‘sanctions checking facility’

Industry News

Jan 5, 2012

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The British Insurance Brokers’ Association (BIBA) has launched a ‘sanctions checking facility’ which will help brokers and insurers in screening their clients.

Currently under the Terrorism Act, it is an FSA requirement for any insurer or broker to ensure every client is not on an HM Treasury (HMT) list which identifies people involved in terrorism. Companies are also required to re-check this list every time the list is updated.

Until now, this screening process was sporadic, often neglected, and varied from company to company. The new BIBA system aims to provide an industry wide method.

The new system, named Sanctions Search, will enable BIBA members to upload their client data and have it automatically checked against the HMT List. Through the facility members will be provided with a robust audit trail to allow them to ‘evidence’ and ‘demonstrate’ that they have initially checked that their clients are not on the list. The facility will also ensure that when any changes are made to the list, users’ client data will automatically be rescreened, at no additional cost, to ensure that this remains the case.

“BIBA frequently receives calls from members telling us of the difficulties they are encountering when screening their clients to ensure that their customers are not target names,” said Steve Foulsham, BIBA Head of Technical Services.

“To overcome this, the new facility provides a cost-effective, automated financial sanctions screening service to provide members with peace of mind.”

The facility is being partly funded by BIBA and competitive rates have been negotiated on behalf of members. All members will be pre-registered including a number of ‘free’ search credits.

BIBA members will be contacted by Sanctions Search shortly providing the relevant information to enable them to activate the facility and to discuss costs for individual brokers. The current pricing structure is based on blocks of 150 of search ‘credits’, with one search credit translating to about one client screening. 150 credits will cost members £10, but the first 150 will be free.

AXA : 2012 will be “year of risk”

Industry News

Jan 4, 2012

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More destructive weather, UK playing host to a number of large events, and continued economic pressures will make 2012 another very expensive year for British insurers, according to AXA Insurance.

The company is predicting that in 2012 a mix of continuing economic pressures, ongoing unusual weather conditions and an unprecedented number of events this summer such as the Olympics, Diamond Jubilee and Euro 2012 could add up to soaring numbers of home claims.

Here are the reasons why:

EVENTS

According to AXA’s claims data, when friends and family get together the likelihood of a something getting lost or damaged rises by up to 78%. With a number of large events scheduled for 2012 most Brits are expected to be either hosting or attending more gatherings, so accidents around the home are expected to rise.

On top of this, the Insurance giant expects the amount of burglaries increase, as thieves take advantage of people leaving their homes for the Olympics.

AXA also found that while many Brits are planning on renting their homes or rooms for the games, only 53% were aware that they need specific tenant insurance to cover themselves for this.

WEATHER

We’re just four days into the new year and already insurance companies have been reporting 300% increases in claims from storm damage.

While the storms will pass eventually, more long term weather phenomenons may start prompting insurance claims as well. For instance, the end of 2011 saw some of the warmest and driest weather on record, and if these ‘drought’ conditions continue it could lead to a huge rise in subsidence for homeowners in 2012.

ECONOMY

With added pressures on personal finances, corner cutting and money saving schemes are expected to increase which could result in a rise in claims.

Homeowners may try to cut back on maintenance expenses which often results in increased repair claims. AXA warned, however, that this is a false economy because if something is damaged as a result of lack of repair claims are usually declined.

Research also shows that the number of household thefts rises in times of economic pressure. The company said they are already seeing evidence of this, with theft numbers on the rise over the past three years.

Christine Matthews, head of household claims at AXA says: “Homeowners need to make sure more than ever that they get their house in order this year. This includes making sure they take precautions against theft but also that their homes are properly maintained.

“We sincerely hope that our predictions turn out to be wrong but we would urge people everywhere across the UK to think about what they can do to avoid the stress and potential financial loss of a burglary or accident around the home.”

Direct Line : 300% increase in claims in 2012

Industry News

Jan 4, 2012

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It’s been a wild start weather-wise for 2012, with trees down and wind gusts of nearly 100mph in some areas. Not surprisingly the insurance sector is being kept busy because of this, with Direct Line insurance reporting a 300% increase in their home claims.

The Met Office reported the wild weather will continue, with severe gales in many places and storm force winds across Scotland, northern England and around southern coasts. Heavy rain will clear in most places but will continue in Scotland. While winds were expected to ease last night, gales still affect the North East of England with frequent showers in North West England.

“Nearly half of all weather related claims are due to roof damage. However, personal safety is paramount and if it is not safe to do so, do not attempt even temporary repairs,” said Stuart Curson head of Direct Line home insurance.

“Damage to gates, garage and shed doors are also common claims. Keep these closed and locked when not in use. This will not only prevent the wind blowing them off the hinges, it is good practice to keep your property secure to avoid an opportunist burglary.”

The company outlined a number of things residents can do in the case of a wind storm:

– Get in touch with the insurer as soon as possible. Direct Line will usually pay for all emergency repairs that need to be carried out to stop the damage getting worse.

– Take photographs of all parts of the home damaged as a result of storms. It may help with the settlement of claims.

– Use a plastic sheet or tarpaulin to temporarily repair storm-damaged roofs, only if it is safe to do so.

Insurance Fraud Enforcement Department opens it’s doors

Industry News

Jan 4, 2012

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London’s new Insurance Fraud Enforcement Department (IFED) opened it’s doors for the first time today, and already they are reviewing a number of cases from the end of last year.

The department, which received £3 million in funding from the Association of British Insurers, is based at the London Police Economic Crime Directorate. It consists of a 34 strong team of detectives and financial investigators who will be working closely with the insurance industry.

The main priority of the department will be to target “the organised crime gangs that are responsible for an increasing amount of today’s insurance fraud, and to change the public perception that committing small time ‘opportunistic’ fraud does not really matter.”

They will be targeting motor insurance fraud and commercial and public liability fraud – while at the same focusing on emerging threats, such as illegal insurance advisers.

“The purpose is to deter, disrupt and reduce fraud across all sectors of the industry,” said David Wood, Head of the IFED. “We’re working from crash-for-cash cases down to minor opportunistic household claims”

City of London Police Commander Ian Dyson, said, “This is an important day for both the City of London Police and the ABI, working together to deliver the Insurance Fraud Enforcement Department on time and budget.

“However, the real work begins today. IFED is here to turn the tide against all those who break the law, dismantling far-reaching criminal networks and changing a culture that says it is ok to submit bogus insurance claims. There is much to be done and there is not a moment to lose.”

AIG : increases 2012 catastrophe reinsurance program by half a billion AUD

International

Jan 4, 2012

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Insurance Australia Group Limited (IAG) today announced it has increased its catastrophe reinsurance program by over half a billion AUD.

The company’s program for the period starting January 1, 2012 includes protection of up to AUD4.7 billion (£3.1 billion), compared to AUD4.1 billion (£2.7 billion) in 2011.

“In challenging market conditions, we are pleased to have concluded a programme which provides us with increased coverage and the additional security of some multi-year protection,” said Mike Wilkins, IAG’s Chief Executive Officer and Managing Director.

“While the overall cost of the programme has risen, the outcome is consistent with the assumptions contained in the insurance margin guidance of 10 to 12% provided by the Group at the outset of the financial year,” he added.

The 2012 reinsurance programme includes cover for flood, which will be extended into Queensland and Victoria early this year.

IAG’s catastrophe reinsurance protection runs to a calendar year and operates on an excess of loss basis. The programme for 2012 comprises the following key components:

– A main catastrophe cover for losses up to AUD4.2 billion (£2.77 billion), including one prepaid reinstatement. The Group retains the first AUD250 million (£165 million) of each loss, with the lower layer of the main programme fixed for a period of three years. Two reinstatements of this layer have been secured;

– An upper layer, from AUD4.2 billion to AUD4.7 billion (£3.1 billion), providing earthquake cover in respect of Australia and New Zealand for a period of three years at agreed prices;

– A buydown arrangement that reduces the maximum cost of a first event to AUD150 million (£99 million);

– Subsequent event cover providing protection above AUD150 million (£99 million); and

– An aggregate sideways cover of AUD250 million (£165 million) excess of AUD300 million (£198 million), with qualifying events capped at a maximum contribution of AUD125 million (£82.4 million) excess of AUD25 million (£16.5 million), per event.

The combination of covers in place at 1 January 2012 results in maximum first event retentions of AUD150 million (£99 million) for Australia, AUD130 million (£86 million) for New Zealand and AUD50 million (£33 million) for the UK. The overall credit quality of the programme is high and has improved over that of 2011, with more than 90% placed with entities rated A+ or better.

For the financial year ended 30 June 2012, the Group expects to report a total reinsurance expense of between AUD700 million (£462 million) and AUD720 million (£475 million). This compares to a total reported reinsurance expense of $620 million (£409 million) the year before.

The financial year expenses and the reinsurance program don’t take into account the AMI business deal the company has recently undergone.

EIOPA consultation paper to have adverse effects on pension schemes

Industry News

Jan 3, 2012

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A consultation paper by the European Insurance and Occupational Pensions Authority (EIOPA)’s could see UK pension schemes increase funding by £600 million or more, according to a J.P. Morgan report.

In the report, J.P. Morgan looked at the implications of the EIOPA paper titled ‘Call for Advice on the Review of the Directive 2003/41/EC: second consultation’, and concluded that it may result in extra expenses for the industry, particularly in the area of pensions pensions.

“The implications of ‘Solvency II for Pensions’ for UK pension schemes are tremendous,” said Professor Paul Sweeting, one of the authors of the report. “They will place additional burden on [defined benefit] pension schemes and large contributions on behalf of sponsors would be necessary to bring UK pension schemes in line with the requirements.”

The three main finding of the report were:

1. solvency II’s and Basel II’s three pillar approaches work well for insurers and banks, but the third pillar – market discipline – has no relevance to pension schemes,

2. if Solvency II is introduced for pensions, it could mean a requirement to increase pension scheme funding by £600bn or more, if investments are required to meet not just Solvency II liabilities, but also the capital buffer (the Solvency Capital Requirement), and

3. the increased governance and reporting requirements will place an additional financial burden on a defined benefit pension scheme.

Prof. Sweeting went on to question whether a Solvency II scheme would be necessary for pensions, or whether it would be needlessly harmful to the sector.

“We question whether a regulatory framework that is designed for large-scale and active insurers is appropriate for application to pension schemes,” he said.

“We hope that steps will be taken to limit the potential adverse impact of new regulation on pension schemes and their sponsoring employers. But whatever happens, the full impact of the changes must be carefully considered before any new rules are put in place.”

Residents urged to take care as 100mph winds lash UK

Good to know

Jan 3, 2012

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As gusts of almost 100mph and heavy rain lash parts of the UK, residents are being urged to take extra care.

The Met office reported peak winds of 97mph on Islay in the Hebrides this morning, and gales of 93mph were reported in the north of Wales.

Sever weather warnings have been put in place for most of southern and western England, West Wales, Northern Ireland and a more sever warning has been given to most of Scotland.

Drivers are being warned to check their route before leaving home as there have been some disruptions to transport. The Dartlford crossing between Kent and Essex is experiencing delays, while trains have been replaced for buses in some northern areas and some ferries routs in Scotland have been disrupted or canceled.

“Strong winds are sweeping across the UK closing many bridges and roads. Check your route before you leave home & be extra vigilant” AXA Insurance warned on twitter today.

Most of the rain is expected to clear as the day goes on, but the Met Office has issued separate weather warnings for parts of west Britain and Northern Ireland for Wednesday.

Not saving in 2011 is biggest regret for Brits

Financial News

Jan 3, 2012

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Not saving enough has replaced not paying off enough debt as the biggest financial regret for Brits, according to a survey by First Direct.

Overall the study found that more Brits were unhappy with their financial situation in 2011 (48%) than 2010 (36%). In 2011 ‘Not paying off more debts’ became the second biggest regret, with ‘Not saving enough’ taking the top spot and ‘paying into a pension’ becoming less of a priority than in 2010.

Fifty-two per cent of UK adults stated that their greatest financial misstep in 2011 was not saving enough, while a third (33%) identified not paying off debt as their biggest financial woe, compared to just over half in 2010 (53%).

Paying into a pension was one of the biggest changes with 14% per cent say they regret not paying enough into their pension last year compared to 37% the year before.

Property continues to be seen as a valuable investment as 12% regret staying in a rented property too long and not buying a house and only 4% regretted buying or investing in property. However, compared to 2010 just 6% regret spending money on an expensive holiday and when it comes to love, it seems that money is no object as just 2% regret spending money on an expensive wedding, a 2% reduction on 2010.

The research also revealed a sharp division in financial happiness between the generations. Over 55s have the fewest financial regrets with fifty-seven per cent saying they did not have any financial regrets in 2011. Whilst their biggest financial regret was not saving enough (20%) this is considerably lower when compared to the 18-24 year olds (69%).

Over 55s are also happiest about their financial situation, although this has decreased slightly since 2010. 44% of over 55s were happy with their general spending compared to 57% who were happy last year.

Medicaid patients half as likely to survive cancer in the U.S.

International

Jan 3, 2012

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Cancer patients on Medicaid, a US public medical cover, survived less time than people with private or no insurance, new data shows.

The research, which looked only at highly treatable types of tumors, found that people on Medicaid were between 1.6 and 2.4 times more likely to die within five years than other patients.

“While Medicaid is potentially lifesaving, it is better to be able to support yourself and have insurance that protects at a higher level than just Medicaid,” said Dr. Derek Raghavan, of the Levine Cancer Institute in North Carolina.

Raghavan and colleagues looked at eight different cancers, such as testicular cancer and early-stage colon and lung cancer, in patients from an Ohio cancer registry.

With treatment, patients typically survive more than five years with those diseases, so doctors often refer to them as “curable.”

The study, published in the journal ‘Cancer’, tracked more than 11,000 patients with private or no insurance and 1,345 Medicaid beneficiaries, half of whom enrolled after or around the time they got their diagnosis. All were between 15 and 54 years old.

Of the non-Medicaid patients, fewer than one in 10 died within five years of their cancer diagnosis.

By comparison, more than one in five Medicaid patients died during that period, and those who enrolled in Medicaid later survived the shortest time.

Dr. Karin Rhodes, another doctor who worked on the study, said while the results highlight the importance of being covered by health insurance, there could be a number of explanations for the survival gap.

More research is needed to find out if Medicaid patients receive worse treatment than others, the doctors said.

Liberty Syndicates appoints new head of Business Advisory team

Social

Jan 3, 2012

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Liberty Syndicates, a member of Liberty Mutual Group, has appointed Rene Dubois to lead its Business Advisory team.

Rene will be taking over the role of Andrew Hall who will leave the company in March after a transitional period with Rene.

Liberty Syndicates Chief Executive Officer, Nick Metcalf, said: “We are very pleased to welcome Rene. Our ability to provide our underwriters and management team business advice of the highest quality is consistent with our status as a ‘must-see market’ and adds to our comprehensive range of underwriting support services.”

Rene is an experienced commercial lawyer with over 17 years’ experience in the insurance industry. He worked most recently positions were with Flagstone Re and Swiss Re.

Travel insurance : tricks not to miss

Good to know

Jan 2, 2012

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When taking out any sort of insurance cover it is important to know exactly what you are buying. For instance, you may think you are covered for flood damage but come to learn that the knee deep water in your living room is actually storm damage, ruling you out of any cover.

So while it may seem like a hassle, reading the fine print of a policy is definitely worth doing and could save you a lot of money.

One of the main areas with ambiguous, quirky or even misleading fine print is travel insurance. Here are a few to look out for on your next holiday:

– Try to think of all the activities you will be doing on your trip and make sure they are all included in the policy. A lot of the time you will have to specifically mention high risk activities such as skydiving, white water rafting, bunjee jumping etc.

– Many insurance policies grossly over insure a certain area to make their policy seem more comprehensive, but it is often just a ploy. For instance, some companies offer 10 million pounds in medical coverage. While this may seem like the deal of a life time, it is very unlikely you would ever need more than 1 million of medical cover.

– If you plan on hiring a moped make sure that it, like other high risk activities, is covered. More and more companies list motorbike accidents as an exclusion so make sure your completely covered.

– If you’re bringing along any expensive luggage like a computer or camera don’t think it is safe just because of a high ‘personal belongings’ cover. Check the individual item limit. Often it is limited at around £150 – £250 so unless you change this your something-thousand pound laptop is now worth just £200.

– If you’ve been to hospital in the last two years this can sometimes exclude you from certain types of medical cover.

– Make sure you are aware of the implications of not getting travel vaccinations. If you travel without the recommended jabs, chances are you wont be covered for any treatment. This exclusion hidden in the term ‘Vaccine Preventable Diseases”.

– Lastly, don’t pay for anything before finalising the policy. Many companies will exclude items that were purchased or ordered before the policy was completely finalised.

These are just a few of a long list of things which can leave you uncovered. The most important thing is to read the fine print and speak with someone in the company to clarify what you think you know.

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