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Aon Risk Solutions announced the Hong Kong opening of its space insurance practice, International Space Brokers.

Specialist space insurance broker’s senior vice president and regional director for Asia, Craig McGilvray, will be based in Hong Kong and will assume responsibility for ISB’s new Asia-Pacific division. McGilvray joined ISB in 2006 and was previously based in Brisbane, Australia, where he developed numerous financial and insurance solutions for many top Australian companies and established an extensive financial network within Australia and Asia. McGilvary will also have responsibility for the marketing of space risks to the Asian space insurance community.

“The opening of the Hong Kong operation is a game changer that will consistently improve execution and success with customers, markets and prospects,” stated McGilvray. “Furthermore, it allows us to centralize our efforts, streamline our approach to the region by improving access and focus on the enormous potential contained within the Asian region.”

ISB Chief Executive Officer Jeffrey Poliseno commented: “The decision to create a presence in Hong Kong was in direct response to those clients and prospects in the region that have called upon the insurance brokerage community to have subject matter experts locally based. Hong Kong is a pivotal hub in Asia and we are thrilled to further enhance our servicing capability and product offering within the Asia-Pacific region.”

Thierry Mangot, chairman of ISB, added: “This strategic investment not only demonstrates the commitment of Aon to the Asia-Pacific region, but reflects its dedication to contribute to the fantastic growth of the regional space industry. Our customers in the region will benefit from the resources allocated to our new office in Hong Kong as their needs are addressed in a timely and efficient manner.”

In addition to its Hong Kong operations, ISB maintains a presence in Washington, DC, London, Paris and Madrid.

Source : Aon

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Standard & Poor’s revised its outlook on Switzerland-based life insurer Swiss Life and on the group’s holding company Swiss Life Holding to positive from stable. At the same time, we affirmed the ‘BBB+’ long-term counterparty credit and insurer financial strength ratings on Swiss Life and our ‘BBB-‘ counterparty credit ratings on Swiss Life Holding.

“The outlook revisions reflect our opinion that Swiss Life is taking significant steps to improve its operating performance and capitalization and is well positioned to further improve its financial profile, based on its success in implementing strategic change,” said Standard & Poor’s credit analyst Christian Badorff.

Among the strategic actions to strengthen operating performance and capitalization, Swiss Life has undertaken a shift toward less interest-rate-sensitive products, such as unit-linked policies, variable annuities, and protection insurance. This has lowered the sensitivity of market-consistent embedded value (MCEV) to interest rates and we expect this to continue. Enhanced asset-liability management has also helped reduce the sensitivity of earnings to interest rate changes. Furthermore, we view Swiss Life’s integration of its acquisition–AWD–as on track.

The ratings on Swiss Life reflect our view of the company’s strong capitalization and competitive position. These strengths are partly offset by business concentration in challenging markets and a still subdued, albeit improving, operating performance.

Swiss Life’s capitalization has improved to levels that we regard as strong. Our assessment is based on Swiss Life’s strong capital base and quality of capital, as well as lower sensitivity to interest rate changes. We also take into consideration regulatory solvency requirements that Swiss Life exceeds comfortably.

Swiss Life’s competitive position is, in our view, strong. Swiss Life benefits from a market leading position in Switzerland and defendable niche positions in France and Germany. Swiss Life’s business model focuses, however, on life insurance markets, which we consider to be challenging. The Swiss, German, and French life insurance markets are mature and competitive.

Although improving, we view operating performance as negative for the rating. However, we expect Swiss Life’s management to take measures related to product design, cost savings, and risk management to strengthen the group’s operating performance.

The positive outlook reflects our expectation that Swiss Life will continue to improve its bottom-line and prospective profitability in 2011 and 2012 and maintain strong capitalization and a strong competitive position.

Increasing contributions from Swiss Life’s foreign operations and AWD should enhance revenue and earnings diversity over the next 12-18 months. Furthermore, we expect that Swiss Life will improve net incomes as well as MCEV-based profitability in 2011 and 2012.

“We may consider a positive rating action over the next 12 months if Swiss Life were able to show sustained strengthening of its operating performance, in line with the upper end of our range of expectations,” said Mr. Badorff. “We could revise the outlook to stable if Swiss Life’s operating performance or capitalization were to weaken or if its risk management practices were to be less supportive of attaining a strong operating performance.”

Source : Standard & Poor’s

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XL Group announced the appointment of Paolo Ribotta as Head of Global Distribution. In the newly-created role, Mr. Ribotta will be responsible for the performance, direction, growth and support of XL’s global network.  He will report to XL’s Chief Executive of Insurance Operations David Duclos and will work closely with XL Insurance’s four business Chief Executives as a fellow member of the XL Insurance Executive Board.

Mr. Ribotta’s major duties will entail collaboration with business leaders across the entire XL enterprise to ensure effective broker and client relationship management as well as network management, which includes managing new fronting partner relationships. He will also be directly engaged in facilitating entry into new markets for XL’s Insurance and Reinsurance segments, as well as supporting development of underserved markets in which XL believes further opportunities exist.  Mr. Ribotta, who joins XL from Zurich Financial Services, will be based in XL’s London office.

Mr. Ribotta has served as CEO, France of Zurich Financial Services since 2004 and prior to that was CEO, Italy for Zurich Global Corporate from 2001 to 2004. He was appointed a Member of the European Board of Zurich’s corporate business in 2002. Mr. Ribotta is member of the World Economic Forum Young Global Leaders group. Previously he worked for UAP International where he started as an International Underwriter trainee. Mr. Ribotta holds a degree in Economics from LUISS University of Rome.

Commenting on the new role and appointment, Mr. Duclos said: “The creation of this new role will allow XL to further enhance our market presence and leverage our strong global network and relationships with brokers and clients. Given Paolo’s extensive industry knowledge and experience, especially in international markets, we are delighted to have him join XL and lead this significant strategic effort.”

Source : XL Group

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In March this year Mactavish published a report outlining how companies are exposing themselves to significant and unnecessary losses due to serious flaws in the way insurance policies are arranged.

We have now moved on to a new phase of research into the UK manufacturing sector and want to share some exploratory themes coming out of the latest interviews.

First, the facts about the British manufacturing base. While the sector has been in relative decline since 1970 – it accounts for twelve percent of National Output, half its share forty years ago – as of 2010 the UK was still the world’s sixth largest manufacturer by output.

Rebalancing the British economy has become an explicit policy priority of the Government. High-Tech manufacturing, in particular, has been buoyed by a lower pound and is in surprisingly rude health according to a research paper published this month by GE.

From a risk perspective the sector has seen its fair share of operational and strategic upheaval following the financial crisis: from rationalisation measures to increase efficiency in supply chains to accelerated product development and diversification into new territories, products and services.

These changes must be fully investigated by insurance buyers and insurers if risk disclosure is to keep pace with quicksilver and widespread operational upheaval.

Deepwateer Horizon and Toyota’s woes in having to recall eight models to fix a problem with a broken pedal have shown that changes made to business practices five or even ten years ago can impact risk profiles in unanticipated ways after a significant timelag.

New Mactavish research shows that the pace of operational change and dislocation in the manufacturing space is startling. While we are still investigating precisely how the following three example issues will impact risks, impact risks they certainly will.

First, we are studying in great depth the blurring distinction between manufacturers and service providers. Increasingly, Mactavish is coming across manufactuers that bundle services into their customer offerings and often take on uncertain professional indemnity exposures.

Second, there is the ongoing issue of ‘liability creep’ in the sector, with manufactuers – as commercial pressures bite – taking on more contractual liabilities than perhaps their product liability insurers realise.

Finally, supply chain disruptions are becoming more common, more complex, and much more widely reported. This is especially true in heavy industries and manufacturing where supply chains are increasingly global and interconnected. The possibility of protracted business interruption disputes, and deeply uncertain financial protection, is clear.

While we continue to investigate these and other issues in UK manufacturing, it is abundantly clear that high risk industries must do far more to investigate and clarify their risks if insurance is to be relied upon in the event of a catastrophic loss event.

Written by Bruce Hepburn, CEO of Mactavish

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Increasing occurences of drought have led to a  jump in European insurance claims for damage to homes owing to subsiding soil, a study by reinsurer Swiss Re and the Swiss Federal Institute of Technology said on Monday.

With temperatures set to rise in coming years and less regular rainfall  amid climate change, future potential losses from soil movements are expected to increase in some areas by over 50 percent for the period 2021 to 2040  compared to today, said the study.

“A long and intense dry spell can lower the ground so much that it creates  fissures in the earth and tears apart the foundations of houses, bridges,  industrial sites and other structures,” explained the research.

“In the worst case, shifting soil can cause whole buildings to collapse,”  it said.

Large swathes of France, Britain, Germany as well as northern Spain are  already now showing jumps of more than 50 percent in potential claims compared to the period 1951 to 1970.

“In France alone, economic losses from soil subsidence have risen by over  50 percent since 1990, amounting to an average of 340 million euros ($494  million) a year,” said the study.

“Climate change will further increase the frequency and intensity of  drought-induced soil subsidence — and with it the risk of future damage to  properties.

“Large parts of Europe will experience more sporadic rainfall and drier  soils, and as a result face far greater losses from shifting soil,” it warned.

Zurich, July 4, 2011 (AFP)

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The overall tax-to-GDP ratio1 in the EU272 declined to 38.4% in 2009, compared with 39.3% in 2008. Data indicate that this decrease was essentially due to the 4.3% drop in GDP from 2008 to 2009, rather than to tax cuts. Compared to the beginning of the decade the EU27 tax ratio declined by 2.1 points.

The overall tax ratio in the euro area2 (EA17) fell to 39.1% in 2009 compared with 39.7% in 2008. Since 2000, taxes in the euro area have followed a similar trend to the EU27, although at a slightly higher level.

In comparison with the rest of the world, the EU27 tax ratio remains generally high and more than one third above the levels recorded in the USA and Japan. However, the tax burden varies significantly between Member States, ranging in 2009 from less than 30% in Latvia (26.6%), Romania (27.0%), Ireland (28.2%), Slovakia (28.8%), Bulgaria (28.9%) and Lithuania (29.3%) to more than 45% in Denmark (48.1%) and Sweden (46.9%).

Between 2000 and 2009, the largest falls in tax-to-GDP ratios were recorded in Slovakia (from 34.1% in 2000 to 28.8% in 2009), Sweden (from 51.5% to 46.9%), Greece (from 34.6% to 30.3%) and Finland (from 47.2% to 43.1%), and the highest increases in Malta (from 28.2% to 34.2%), Cyprus (from 30.0% to 35.1%) and Estonia (from 31.0% to 35.9%).

This information comes from the 2011 edition of the publication Taxation trends in the European Union3 issued by Eurostat, the statistical office of the European Union and the Commission’s Directorate-General for Taxation and Customs Union. This publication compiles tax indicators in a harmonised framework based on the European System of Accounts (ESA 95), allowing accurate comparison of the tax systems and tax policies between EU Member States.

This year’s edition of the report for the first time includes data on average effective tax ratios for non-financial corporations. In addition, the report also contains a detailed analysis of the impact of the economic and financial crisis on the tax systems of all EU Member States.

Standard VAT rate hiked by 1.3 points since the beginning of the economic crisis

One area where the onset of the economic and financial crisis has clearly had an impact was consumption taxation. Rising only slightly from 2000 to 2008, the average standard VAT rate4 in the EU27 has risen strongly from 19.4% in 2008, to reach 20.7% in 2011. The standard VAT rate in 2011 varied from 15.0% in Cyprus and Luxembourg to 25.0% in Denmark, Hungary and Sweden.

About half of the Member States have increased VAT rates between 2008 and 2011. The highest increases were registered in Hungary (from 20.0% to 25.0%), Romania (from 19.0% to 24.0%), Greece (from 19.0% to 23.0%) and Latvia (from 18.0% to 22.0%).

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Analysis from moneysupermarket.com has found the average interest rate across two-year fixed rate mortgage products is at its lowest since the Bank of England base rate dropped to 0.5 per cent in March 2009. This highlights the increased levels of competition within the mortgage market.

Fixed rate mortgages have steadily fallen over the last couple of years, with the rate on the average two-year product now standing at 4.25 per cent. This compares with an average of 5.59 per cent in spring 2009. Three-year fixed rates are at their lowest since December 2010 while five-year products are at their lowest rate since January 2011 at 4.80 per cent and 5.27 per cent respectively.

Fixed rates may have fallen but the rates on the leading tracker mortgages have also dropped and remain popular among borrowers who believe base rate will remain low for some time.

The average Two-year tracker rate is 3.58 per cent – its lowest level since January 2011. Base rate would have therefore have to rise by 0.60 percentage points over the next two years for the tracker to equal to average two-year fixed rate.

The rates on three-year trackers have also edged downwards, with the average now 4.05 per cent – its lowest level since February 2011.

Clare Francis, mortgage spokesperson at moneysupermarket.com said: “It’s great to see fixed rate mortgage rates coming down and we are now seeing average rates falling to their lowest levels in several years. Many borrowers are worried that high inflation will result in base rate rising in the not too distant future and for these people it’s obviously great news that they can protect themselves from this eventuality by locking into a fixed rate at a lower level than they’d have been able to do a few months ago.

“However, with no one knowing when base rate will start rising, and a number of economists saying it could be next year at the earliest, some borrowers will be happy to take a gamble and go for a variable tracker mortgage in order to benefit from lower repayments now.”

“Interest rates will start rising at some point though, so anyone considering a variable rate deal needs to make sure they’ll be able to afford higher monthly repayments.”

Source : Moneysupermarket.com

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The Financial Services Authority (FSA) has today outlined how its successor body charged with conduct and markets regulation will be tougher, bolder and more engaged with consumers.

The approach document sets out how the Financial Conduct Authority (FCA), which will assume responsibility for protecting consumers and markets’ regulation from the end of 2012, will deliver its objectives.

The Government has recently published a White Paper outlining how the FCA will:

– Be more outward looking and engaged with consumers and better informed about their concerns and behaviour where this is relevant to regulatory action;

– Intervene earlier to tackle potential risks to consumer protection and market integrity before they crystallise; and

– Be tougher and bolder, building on and enhancing the FSA’s credible deterrence strategy, using its new powers of intervention and enforcement.

Hector Sants, FSA chief executive, said:

“Trust in the financial services sector is at an all time low and the new regulatory arrangements provide the opportunity to restore confidence in an industry which has generated in excess of £15bn detriment over the last two decades.

“This document sets out the approach the FCA will be taking to improve regulation, a key element in restoring trust in the industry.

“For the FCA to be successful it must have the support of society and Parliament, and its objectives and approach must be clearly understood by all.

“The document is designed to stimulate debate on the key questions to be resolved, which includes finding the right balance between the benefits of early intervention and the consequent risks of reducing choice and raising costs, and also clarity regarding the balance of responsibilities between consumers and industry.

“The FCA’s proposed approach moves the calibration of these questions in favour of more intervention but the question which needs to be answered is whether society is happy to accept the resultant costs and potential reduction in individual freedom.”

Margaret Cole, interim managing director of the conduct business unit, said:

“We will now press on with developing our thinking on how to implement the approach set out in this document. We are clear that this will require significant investment, building on and improving what the FSA has achieved so far. I am confident that, if implemented, this approach will deliver significantly higher levels of protection than consumers have enjoyed over the last 20 years.”

At this early stage in the development of the new regulatory structure, the publication sets out the approach the FCA plan to take and raises issues that need to be considered by industry, legislators and consumer representatives. This open debate, seeks to find consensus on the type of regulator needed to restore customer trust in a sector which has generated billions in consumer detriment due to mis-selling scandals.

The FSA would welcome comments on the approach document by 1 September 2011.

Source : FSA

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To provide war and terrorism insurance capcity for the Middle Eastern risks, Liberty International Underwriters (LIU) and Liberty Syndicates have teamed up in a joint initiative.

LIU will distribute its product through Middle Eastern brokers and provide customer service from its regional office in the Dubai International Financial Centre backed by reinsurance capacity and expertise provided by Liberty Syndicates in London.

LIU will offer this cover to onshore energy-related risks, industrial units and urban risks such as hotels, restaurants, office blocks and banks.

Demand for war and terrorism cover has increased in the Middle East because, in several jurisdictions, banks require back-to-back cover as precondition for financial support.

There has also been a surge in demand for war and terrorism cover following recent events which resulted in political change in Tunisia and Egypt and widespread civil unrest elsewhere in the MENA region.

Michael Burle, class underwriter at Liberty Syndicates, said: “We began to discuss opportunities to develop the initiative in August 2010. Since then, political and regulatory events have meant that demand has surged.

Eli Bouchaaya, MENA regional manager for LIU, said: “We are very pleased to be able to access our group’s Lloyd’s syndicate in order to bring supplementary underwriting expertise and capacity to this complex set of risks. We have worked hard to ensure the product is provided as a rapid and seamless service across the GCC and wider MENA region, with a 24-hour promise for policy quotes.”

The joint venture product is marketed via Liberty Mutual Group for the GCC (Saudi Arabia, UAE, Kuwait, Bahrain, Qatar and Oman) and MENA region (excluding Syria, Afghanistan, Libya and Sudan).

Source : Liberty Mutual Group

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In a new report published by Fitch Ratings, European insurers’ exposure to Greek, Irish and Portuguese (GIP) sovereigns is manageable and unlikely to have significant ratings implications. The agency’s primary concern for the European insurance sector is the risk of a disorderly sovereign debt restructuring or rollover dislocating broader European markets, leading to significant widening of credit spreads and sharp equity price declines.

“The direct exposure of the European insurance sector to Greek sovereign risk is relatively low and, in most cases, is unlikely to have significant ratings implications in the event of some kind of Greek restructuring or rollover event,” says Harish Gohil, Managing Director in Fitch’s EMEA Insurance team.

Fitch reviewed the exposures of those companies that were previously identified as having the most significant exposure to Greece in relation to their capital base. The updated review showed that in general the exposure to Greek sovereign risk has been reduced significantly, or even eliminated, over the past year. The potential losses for insurers if Greece defaults have thus diminished and in many cases would be nil or negligible.

“However, if the details of any restructuring of the Greek sovereign debt meant that losses exceeded the agency’s expectations, there could potentially be a small number of downgrades,” says Gohil.

Provided that this risk of contagion can be relatively quickly contained, most European insurance groups should be able to absorb the immediate credit, market and liquidity risks with only minor, if any, negative ratings actions.

However, should the risks of contagion be amplified and lead to a protracted period of severe and broad impact across the European markets, with significant credit spread widening and sharp falls in market values, then there could be a risk of negative rating actions for more European insurers.

Fitch’s report “GIP Exposure Manageable, But Broader Dislocation of Financial Markets is Primary Concern” is available at www.fitchratings.com.

Source : Fitch Ratings

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Hannover Re has bought an extra $100 million worth of protection against possible hurricane damage claims in the United States this year, it said on Thursday.

The reinsurer bought what is in effect extra insurance cover for itself after claims from earthquakes in Japan and New Zealand and other disasters early in the year forced it to cut its 2011 profit target.

Like bigger rivals Munich Re and Swiss Re, Hannover Re is awaiting the outcome of what is expected to be an active North Atlantic hurricane season, which runs through November.

In presentations to investors on Thursday, Hannover reiterated its 2011 goals, including earning net profit of around 500 million euros ($717 million).

Aside from the fresh hurricane protection, the reinsurer has pencilled in a buffer of about 410 million euros for man made and natural catastrophe losses and has about 450 million euros worth of cover from other reinsurers in the event of big damage claims in the April-December period.

These buffers should help protect the full-year profit goal.

“We strive for lower volatility of our earnings,” Chief Executive Ulrich Wallin said on a presentation slide, adding that contract renewals with insurance company clients following the earthquake in Japan show pricing power is swinging in favour of reinsurers.

Hannover Re also predicted rising premiums and profit in its life reinsurance business in the coming years, saying it planned to continue looking for acquisitions and portfolio takeovers in the segment.

Life reinsurance gross premiums are seen more than doubling to 11.9 billion euros by 2020 from 2010, while net income in the segment is projected to rise to 477 million euros by 2020 from 220 million last year.

Hannover Life Re is expected to attain a worldwide market share of nearly 18 percent in 2020, from around 12 percent now.

Source : Reuters

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Fitch Ratings says in a newly-published report that Solvency II, the new regulatory regime for European insurers from 1 January 2013, is poised to transform how insurers allocate their assets, leading to shifts in demand and pricing for several asset classes.

The report, entitled “Solvency II Set to Reshape Asset Allocation and Capital Markets”, highlights that the new rules will require insurers to value asset and liabilities at market value in determining their solvency position.

“Solvency II will force insurers to set aside explicit capital to reflect short-term volatility in the market value of the assets they hold,” says Clara Hughes, Director in Fitch’s Insurance team. “Insurers’ asset allocations will be heavily influenced by these capital charges, which vary significantly by asset class, quality and duration. This is a fundamental change from current asset allocations, which are driven by expected long-term investment returns.”

The main impacts would be a shift from long-term to shorter-term debt; an increase in the attractiveness of higher-rated corporate debt and government bonds; diversification of large asset holdings; an increase in the attractiveness of covered bonds; a preference for assets based on the long-term swap rate and a shift from short-dated paper to deposits.

European insurers are the largest investors in the European financial markets, holding EUR6.7trn of assets including more than EUR3trn of government and corporate debt.

Fitch expects to see better duration matching with derivatives such as swaps and floors and an increase in downside protection to mitigate the impact of the new capital charges. Fitch also anticipates an increase in financial engineering to create Solvency II-friendly assets such as reverse repos and structured notes, which can optimise return on capital

However, Fitch considers it unlikely that large-scale reallocations will happen in the short term as transitional arrangements are likely to phase in implementation of Solvency II over several years.

Insurers will also have the option to calculate their capital position using an internal model rather than the proposed standard formula. This could offset the impact of any capital requirements in the standard formula that do not accurately reflect the risk in insurers’ portfolios.

Source : Fitch Ratings

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British insurer Aviva on Thursday announced the sale of its roadside rescue division RAC to private equity firm Carlyle for £1 billion ($1.60 billion, 1.12 billion euros), as the group seeks to focus on insurance products.

“Aviva plc announces that it has agreed to sell RAC Limited, the second largest UK roadside assistance provider, to The Carlyle Group for £1.0 billion,” it said in an official statement.    The deal, which is expected to be completed at the end of the third quarter of 2011 and is subject to competition and regulatory approvals, is part of Aviva’s strategy to focus on insurance and savings businesses in priority markets.

Aviva bought RAC for £1.1 billion pounds in 2005 — but it has since offloaded divisions including RAC France, the BSM motoring school and Auto Windscreens.    RAC, which is based in Birmingham in central England, employs 4,000 staff and has more than seven million customers. Pre-tax profits stood at £82 million in 2010.

The group’s 1,800 patrol vans, painted in distinctive orange and silver, attended 2.5 million rescue breakdowns in Britain last year.    “The sale of RAC is another important step for Aviva and realises significant value for our shareholders,” added Aviva Chief Executive Andrew Moss in the statement.    “Together with the recent partial disposal of Delta Lloyd, it demonstrates clear delivery of our strategy and provides the flexibility to deepen our presence in the priority markets where we have strength and scale.”

Back in 2009, Aviva floated 42 percent of Dutch subsidiary Delta Lloyd in an initial public offering in Amsterdam, and further trimmed its stake earlier this year.    Aviva is Britain’s second-biggest insurer after Prudential, and is the sixth biggest global player, with more than 53 million customers and 45,000 employees worldwide.    Under the terms of the deal, meanwhile, Aviva will pump £67 million into the RAC pension fund, which had a deficit of £160 million at the end of 2010.

London, June 23, 2011 (AFP)

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Munich Re stated that deadly weather catastrophes in China had  soared around four-fold in the last 30 years, costing its economy billions.

Munich Re said in a report that the number of annual disasters including  violent storms, floods, extreme temperatures, droughts and forest fires had  risen to about 48 by 2010 from around 11 in the early 1980s.

A company spokesman noted however that official reporting of such  catastrophes would have been less transparent in China in the 1980s than today.

Munich Re said the weather events had claimed the lives of 148,000 people  and cost $422 billion dollars over the same period.    The head of Munich Re’s Georisk Research, Peter Hoeppe, said China’s  current flooding woes were only the latest in an escalating long-term trend.

“The devastating floods in China are of a dramatic dimension — a  phenomenon that has unfortunately occurred in China with increasing frequency  over the last few decades,” Hoeppe said in an e-mailed message.

“Every year, millions of Chinese are victims of weather-related natural  catastrophes. And the risk is steadily growing, for climate change harbours  the potential for torrential downpours while the risk of drought in certain  regions is also on the rise.”

Persistent rains since early June have swamped many areas across a wide  swathe of China and the state weather bureau has forecasted continued  downpours with the summer typhoon season approaching.    Torrential downpours across large parts of the country last year triggered  the nation’s worst flooding in a decade, leaving more than 4,300 people dead  or missing in floods, landslides and other rain-related disasters.

Berin, Jue 21, 2011 (AFP)

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Aviva’s new research shows that just in a generation, children travel further and to a wider range of destinations than ever before.

The survey of 1,006 UK parents found that over the past generation, the proportion of families going overseas for their holidays has risen significantly. A growing proportion of families surveyed (1,006 UK parents) are going overseas for holidays.

While 94% of parents said their own children had been abroad before the age of 16, just 4 in 10 (39%) had been abroad themselves when they were young, a difference of 55%.

Children are also travelling to further flung destinations than their parents ever did. While just 2% of today’s parents had been to North America when they were young, over a quarter (28%) have now taken their own children to the USA or Canada. Closer to home, just 26% of today’s parents said they had been to Europe when they were a child yet 73% said they had since taken their own children to the continent.

Of the people who take their children on two foreign holidays a year, 94% go to Europe and 51% go to the USA. Assuming a trip to the south of Spain and another to Florida, these children would have flown over 10,000 miles per year, meaning they would possibly have flown the equivalent of seven times around the globe by the time they were 16.

Today’s Parents’ Childhood Today’s Children
Travelled Abroad 39% 94%
Been to Europe 26% 73%
Been to America 2% 28%
One or more foreign holidays per year 38% 62%

Even destinations that have traditionally been the preserve of students or the very wealthy are seeing parents visiting with children, including North Africa (8% have taken their children), Asia (7%) and the Caribbean (6%).

The frequency of parents taking their children away on average once a year on holiday rose from 30 per cent, as they were children, to 50 per cent today. Additionally, the percentage of children going abroad more than once a year has risen by a half from 8% when parents were children themselves, to 12% who take their children abroad this frequently now.

Over the past few years the risk of travel disruption has increased. A quarter of people surveyed in different Aviva research say they have felt the effects of major travel disruptions in 2010 such as the Icelandic volcano, the BA strikes of May or the snow and ice in winter.

Aviva has decided to add a new disruption cover to its travel insurance offers. This is an additional add-on to its existing travel insurance policy and offers a wider cover in the event of strike, industrial action or cancellation due to FCO warnings, pandemics or natural disasters, including earthquakes, tsunamis, preventing departure from the UK. Similar cover for abandonment of the holiday due to these sorts of events is also exists.

In addition, this new section will provide cover for missed connections outside the UK, as well as a 12 hourly benefit for delayed departure outside the UK.

Other new features that Aviva has introduced as standard to its policies include online documents and medical screening, meaning that the whole transaction can be completed online even for people with pre-existing medical conditions. The upper age limits have also been increased from 69 to 74 for annual multi-trip policies and to 79 for single trip policies.

Jerry Finch, travel insurance product manager, said, “It is often said that the world is getting smaller and nowhere is the huge increase in the extent of our travel more apparent than the distances and range of places that people have been to before the age of 16. Children nowadays are better travelled and have experienced a wider range of cultures than ever before.

“However, we have seen recently that travellers have been affected by an increased risk of disruption to their plans. It is therefore important that people have the right level of cover to ensure that even if their arrangements are hit by unavoidable events, they are not left to pay the price.

“That’s why Aviva’s travel insurance now has the option to include travel disruption cover. This follows the add-on we launched last year to cover airspace closure, an issue that has featured prominently in the news lately, with the recent volcanic activity in Iceland and Chile.”

Source : Aviva

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The Government is considering staggering the increase in retirement age for women. LV= Retirement Solutions Director at LV=, John Perks, comments :

“We support changes to the state retirement age that makes it fair for as many people as possible, and a more staggered rise will be a relief to the women who currently face the sharpest increase in retirement age. Our own recent research among those close to retirement* showed that 35% of women admit they have no personal pensions savings, with 22% relying solely on the state to fund their retirement. Women over 50 are clearly worried about retirement with nearly three quarters (70%) saying they have become more concerned over the past 12 months about their financial situation and level of savings as they head towards retirement, and a quarter (25%) of women say they now expect to retire later than they originally planned.

“Building up personal savings makes a huge difference to the type of retirement people can enjoy, and if someone in their 40s or 50s doesn’t yet have any retirement savings it isn’t too late. With people living longer and healthier into retirement someone in their 50s could still have 20 years of working life to save something into a pension. Our research also shows that a greater number of women go without advice than men, with 70% of women over 50 saying they have not sought any financial advice about their retirement. With women historically having less personal pensions provision than men it’s even more important to get the message across that it’s never too late to save, and even a little advice can make a significant difference.”

Source : LV=

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Hackers have stolen the personal data of some 1.29 million customers of the Japanese game maker Sega, the company said on Sunday, in a theft via a website of its European unit.

The Sega Pass website, operated by London-based Sega Europe, did not contain credit card information, the Japanese firm said.

But names, dates of birth, email addresses and encrypted passwords were stolen by intruders to the site, Sega said in a Japanese-language statement, adding the theft had been confirmed on Friday.

“We sincerely apologise for troubles this incident has caused to our customers,” it said.

The service, which has been suspended, was mainly to announce new product information to registered customers, Sega said.

“An investigation has been launched to find the cause and channels used for the leakage,” it said.

No other websites managed by Sega have come under attack, it said.

Sega pledged to strengthen its network security and to release information about the case as it becomes available.

The incident follows a series of hacker attacks on Japanese electronics and entertainment giant Sony in April which forced it suspend online services for weeks.

Sony suffered one of the biggest data breaches since the advent of the Internet, with personal data from 100 million accounts compromised.

The attacks forced the company to halt its Qriocity online music and video distribution services and PlayStation Network online gaming for more than a month.

Sony also suffered attacks on websites including in Greece, Thailand and Indonesia, and on the Canadian site of mobile phone company Sony Ericsson.

This month, a group of hackers known as Lulz Security claimed to have attacked the Sony Computer Entertainment Developer Network and stolen technical information, after stealing customer data from SonyPictures.com.

Websites of major media, game makers, banks and the US government have been constant targets of international hackers.

Nintendo, Citigroup, the CIA and the Malaysian government have recently come under hacker attacks.

Sega, known for “Sonic the Hedgehog”, produces games for a range of consoles, including the PlayStation 3, Nintendo DS, Microsoft’s Xbox 360 and Nintendo’s motion-control Wii.

It became a household name with popular arcade games such as “UFO Catchers” and in 1998 won a fan base with its Dreamcast machine. But it stopped producing the Dreamcast in 2001 under fierce competition from Sony and Nintendo.

The company has since focused on arcade machines and software. It saw a new lease on life after merging in 2004 with Sammy Corp., Japan’s top maker of pinball slot machines.

Tokyo, June 19, 2011 (AFP)

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Willis North America  announced the appointment of John A. Connolly as Executive Risks Practice Leader.Since 2009, Connolly has been the coleader of the practice with Steve Pincus, who will continue to manage Willis’ substantial Executive Risks operations in New York.

Willis is an industry leader in the Executive Risks space, helping organizations assess professional liability and minimize exposures in an increasingly complex legal, regulatory and economic environment. A team of experts specialize in Directors’ & Officers’ Liability Insurance, Errors & Omissions and Professional Liability Insurance, Fidelity Bonds, Employment Practices Liability and Fiduciary Liability, as well as Cyber/Network Liability. The practice currently consists of more than 100 Associates in 13 offices across North America.

Connolly will be responsible for leading the Practice and driving business development in North America. He will collaborate with Willis’ global executive risks practice, FINEX, to deliver innovative solutions to North American clients. He will also work closely with the insurance carrier community to secure industry leading insurance coverage. Connolly will report to Eric Joost, Chief Executive of Willis North America Specialties.

Commenting on this appointment, Joost said, “John has an outstanding reputation in the executive risk space and a keen eye for innovation. In the rapidly evolving landscape of executive risk, Willis has established itself as an industry leader under John’s guidance and I’m confident we will continue to build on our success.”

Philadelphia-based Connolly joined Willis in 2007, and has over 25 years of experience in the insurance industry. As D&O and Professional Liability expert, Connolly has served as both a broker and an underwriter in London and the United States.

Source : Willis

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Swiss Life has just announced the launch of a new insurance product destined to protect the reputation of an individual. Swiss Life E-Reputation has been developed in partnership with Reputation Squad, specialist in reputation management on Internet, and is for now only available to individuals in France. This product provides financial, legal and technical resources to protect anyone in case of violation their reputation on Internet.

The fast growing online tools to inform and share, as well as the speed with which the information is disseminated by other web suffers has increased the risk related to one’s reputation.

According to a survey performed by Harris Interactive on behalf of Swiss Life (May 2011), if nearly half of the web users surveyed fear the consequences of information being disseminated without their consent, 72% would not spontaneously know what to do to remove it.

This is how Swiss Life has come to develop this new type of insurance.

“Googling” someone such as friends, family or colleagues has become today something common. It seems that 57% of web users recognise having already conducted such a form of investigation on a friend and 47% on a colleague. The impact of an individual’s negative reputation spreads fast. The control of private data online is near impossible; 66% of web users are aware of this risk which concerns addresses, phone numbers, banking details, etc.

Thus a majority of Internet users are aware of the risks and again, a majority of them do not know how to react in such a case where their reputation online is damaged.

Swiss Life is used to being present online, with products sold on internet and having clients use Internet directly through Swiss Life sales forces and distribution channels. With their constant drive towards innovation in day to daty life, hey have understood the risk related to online reputation but also that this risk was not yet covered. The costs associated to correct the wrongdoings are often too high (an average of 2,000 to 3,000 EUR) and victims of reputation related issues decide to not repair the problem. It is in this sense that the insurance company has decided to think up a good protection for these people. Swiss Life E-Reputation covers the risk of reputation by the dissemination through Internet of the following (if harmful and without consent of the individual) :

– Denigration

– Insults

– Defamation

– Statement publications

– Written content

– Photos and videos

Actions to re-establish a reputation can lead to court. This product covers legal fees and is shouldered by a specialist legal firm (CIVIS). Reputation Squad is in charge of removing all content or drowning the information. These actions include the identification of those responsible for publishing the contents (bloggers, web hosting agencies, etc.) and determining the legal approach.

This product is focused on individuals, in particular students nearing the end of their studies, families, employees and executives. The cost of Swiss Life E-Reputation is 9.90 EUR (8.69 GBP) per month for the subscriber and he subscriber’s family, for a 10,000 EUR (8,779 GBP) maximum payout.

Source : Swiss Life

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The latest edition of Aon Benfield Aggregate (ABA) report has been launched. This report analyses the financial position of the world’s leading reinsurers at the end of the first quarter. (see  www.aon.com/attachments/reinsurance/150611_aba_q1_2011.pdf)

Aon Benfield Analytics estimates that total global reinsurer capital declined 6% from USD470 billion at December 31, 2010 to USD440 billion at March 31, 2011: the primary driver being the high level of insured catastrophe losses in the quarter. This calculation is a broad measure of capital available for reinsurance and includes both traditional and nontraditional forms of reinsurance capital.

The latest study compiled by the Market Analysis team found that the ABA group of 28 leading reinsurers reported capital totalling USD238.3 billion at the end of the first quarter – a decline of 3.4% or USD8.3 billion from the end of 2010. The main contributory factors were USD4.3 billion of net losses, USD2.5 billion of unrealized investment losses, USD2.0 billion of dividend payments and USD2.0 billion of share buy-backs.

The first quarter combined ratio rose by 38.3 percentage points to 143.7%, with USD15.1 billion of catastrophe losses representing 57.1% of net premiums earned. This translated into a property and casualty underwriting loss of USD11.5 billion. The total investment return reported by the ABA fell by almost a third to USD9.0 billion, driven by a much lower level of capital gains.

The overall net loss of USD4.3 billion reported by the ABA reinsurers for the first quarter of 2011 represented a negative return on average common equity of 1.8%.  This followed a return of 10.4% or USD23.5 billion for the whole of 2010.”

Mike Van Slooten, head of Aon Benfield’s International Market Analysis team, said: “The ABA entered 2011 with peak levels of capital and the decline in reported shareholders’ funds was only 3.4% in the first quarter, despite significant incurred catastrophe losses. We would expect to see this recovered in the second quarter, everything else being equal.”

Source : Aon Benfield

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