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Sofia Ashmore

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Hightlights:

  • Net operating income of $331 million
  • Net income of $263 million
  • Book value per common share of  $35.38

CNA Financial Corporation announced third quarter 2009 results, which included net operating income of $331 million, or $1.11 per common share, and net income of $263 million, or $0.86 per common share.

The combined ratio for Property & Casualty Operations was 101.0% for the quarter.

Book value per common share was $35.38 at September 30, 2009, as compared to $27.53 at June 30, 2009 and $20.92 at December 31, 2008.

Net operating income for the three months ended September 30, 2009 improved $248 million as compared with the same period in 2008.

Net operating income for core Property & Casualty Operations increased $179 million, while results for non-core operations increased $69 million.

This improvement was primarily due to lower catastrophe losses, higher net investment income and a $61 million after-tax gain from a settlement that resolved litigation related to the placement of personal accident reinsurance.

Catastrophe losses were $15 million after-tax in the third quarter of 2009, as compared with catastrophe impacts of $168 million after-tax in the third quarter of 2008. Partially offsetting these favorable items was an unfavorable change in current accident year underwriting results excluding catastrophes.

Property & Casualty Operations produced third quarter combined ratios of 101.0% and 107.0% in 2009 and 2008, or 99.5% and 91.3% before the 1.5 point and 15.7 point impacts related to catastrophes.

Thomas F. Motamed, Chairman and Chief Executive Officer of CNA Financial Corporation comments: “CNA turned in another quarter of solid operating income, driven by improved investment income and relatively light catastrophe losses,”.

“In our core Property & Casualty Operations, we are pleased with the continued strong performance of the Specialty Lines segment. We continue to focus on improving profitability in the Standard Lines segment. Rate trends are encouraging across our portfolio. However, the recession has reduced exposures, putting downward pressure on premium volume.”

“We are also pleased by the continued strong recovery of CNA’s investment portfolio. Book value per common share increased 29% over the course of the quarter, even as we continued our efforts to reduce portfolio risk and volatility,” said Mr. Motamed.

Click here to read the full 3rd quarter result details

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Jean-Philippe Thierry will retire from AGF chairmanship and Allianz SE Board of Management on 31 December 2009.

Within this context the Euler Hermes Supervisory Board which met earlier today, has appointed Clement B. Booth Chairman as of 1st January 2010.

He takes over from Jean-Philippe Thierry, who will remain a .

Clement B. Booth joined the Euler Hermes Supervisory Board at the 18 September 2009 Shareholders Meeting. (Paris, 09/11/2009)

Clement B. Booth, 55, a German citizen, has been a Member of the Management Board of Allianz SE since 2006. He is responsible for reinsurance and the global corporate & specialty insurance business as well as insurance activities in the NAFTA region, United Kingdom, Ireland and Australia.

From 2003 to 2005, Clement B. Booth was Chairman and CEO of Aon Re International, based in London. He was with the Munich Re Group for 18 years before this, the last 5 of which were as Member of the Management Board in Munich during which period his overall responsibilities included credit reinsurance.

Clement B. Booth has 36 years of experience in the insurance business.

The Supervisory Board thanks Jean-Philippe Thierry who, as its Chairman since 2001, played a decisive role in the forming and the development of the Euler Hermes group.

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Brit Insurance has become the first insurer in the Lloyd’s market to both endorse a risk and bind a new risk via the Lloyd’s Exchange*.

The endorsement agreement, the first to use two way electronic messaging via the LEX, was achieved earlier this month between Sarah Mack, of Miller Insurance Services Limited (Miller) and Brit Insurance Energy Underwriter Sara Valentine.

Brit Insurance has been a leading player in the development of e-placement support for risks over the last three years – both for renewals and new business – and was the first to complete initial LEX connectivity testing earlier this year. This has built upon the previous two-way connectivity established with Aon, Miller and a number of other brokers.

E-placement allows delivery of structured risk information and supporting documentation. Underwriters can respond electronically with their agreed line size from any geographical location. Using a single connection, the need for multiple peer-to-peer links is eliminated. From early 2010, the LEX will also validate the content of the message to ensure it is 100% compliant with agreed standards, thus avoiding the need for technical queries between underwriters and brokers.

Malcolm Beane, Chief Operations Officer at Brit Insurance, commented: “This agreement marks a real and significant development in electronic trading at Lloyd’s. Brit Insurance is proud to be at the forefront of market change and we are confident that the Lloyd’s Exchange will transform the way our market does business.”

Sue Langley, Director Market Operations & North America, Lloyd’s, commented: “Building on the live one way messages currently being sent, it is exciting to see Brit Insurance complete the first two way agreement. This is the next step on the Lloyd’s Exchange and it’s great to see Brit Insurance pushing this forward.”

John Bissell, Head of Operations and Board Director at Miller, commented: “We are delighted to again be at the forefront of making things happen in the market and demonstrating that organising and standardising two-way electronic data messaging in support of the insurance placement between parties does work.”

*How does the Lloyd’s Exchange work?
Brokers send an ACORD format message from their system to the new Lloyd’s Exchange, which then routes the data and documentation to the Brit Gateway and any other underwriter connected to the Exchange. This works in a similar fashion to a telephone exchange, in that the participant brokers and underwriters build and maintain only one connection. The Exchange manages all of the routing.

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AXA announced that a joint offer was submitted by AMP and AXA to the AXA Asia Pacific Holdings (“AXA APH”) board on November 6, 2009.

AXA and AMP have entered into an exclusive arrangement whereby they have agreed that, if the offer is successful, AXA would take ownership of 100% of the Asian business and AMP would take ownership of 100% of the Australia & New Zealand business.

If successful, this offer would be equivalent to AXA selling its 54% stake in AXA APH’s Australia & New Zealand business while acquiring the 46% of AXA APH’s Asian operations that AXA does not own for a net cash payment of Euro 1.1 billion.

“This transaction would reinforce AXA’s growth profile by doubling its exposure to the Asian Life & Savings market and further optimize the corporate structure of the Group” said Henri de Castries, Chairman of the AXA Management Board.

“The proposed transaction offers to AXA APH’s minority shareholders a significant premium and the opportunity to become shareholders of a larger and stronger AMP Group which will permit them to share directly in the significant synergies that this transaction would create.”

Transaction structure & conditions

The joint offer submitted to the AXA APH board contemplates a Scheme of Arrangement pursuant to which:

  • AMP would acquire 100% of AXA APH’s outstanding shares for A$ 11.0bn (based on AMP stock price of A$5.75), with the objective of retaining and integrating the Australian and New Zealand operations (including the currently listed holding company). AMP would buy AXA’s shares in AXA APH for A$ 6.0bn in cash.
  • As part of the transaction, AXA would acquire from AMP 100% of AXA APH’s Asian operations for $A 7.7bn in cash, with the objective of increasing its exposure to high growth markets.

The price offered by AMP to AXA APH’s minority shareholders is $A 5.34 per share of which 26% would be paid in cash and 74% in AMP shares. This offer provides a 31% premium (vs. closing share price on November 5, 2009) to AXA APH’s minority shareholders.

Net cash consideration paid by AXA would be A$ 1.8bn (or Euro 1.1bn), corresponding to the difference between (i) the value of 100% of AXA APH’s Asian operations, and (ii) the value of 54% of AXA APH. As part of the transaction, AXA APH would reimburse the A$ 0.7bn internal loan granted to it by AXA and AXA would subscribe A$ 0.5bn of lower Tier 2 subordinated debt to be issued by AMP.

The transaction, if successful, would have the following impacts on AXA:

  • accretive on earnings per share in 2010,
  • -1 pt on Solvency I, which was slightly above 140%(1) at September 30, 2009,
  • +2 pts on debt gearing (2), which was 31% at June 30, 2009.

Subject to obtaining AXA APH’s independent directors’ recommendation for this proposal, completion of the transaction will also be subject to approval by AXA APH’s minority shareholders and customary regulatory approvals.

AXA has agreed to enter into an exclusivity arrangement with AMP for the purpose of this offer. The offer can be withdrawn by AXA and/or AMP at any time. Rationale of the transaction.

This transaction would double AXA’s exposure to high growth Asian Life & Savings markets with no integration risk.

The contemplated transaction would double Asia’s contribution (excluding Japan) to Group Life & Savings top line and earnings:

  • APE from 3% to 6%(3)
  • NBV from 12% to 21%(3)
  • Life & Savings underlying earnings from 6% to 11%(3)

In Asia, AXA APH is active in 8 countries and has a strong growth track record (+18% CAGR in IFRS Underlying Earnings over the last three years).

This transaction would also simplify AXA’s corporate structure in Asia, where the Group also holds both insurance and asset management businesses directly.

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    President Barack Obama, his top domestic priority in the balance, was to make a rare in-person plea Saturday for wary lawmakers to cast an historic vote for legislation to remake US health care.

    Obama, who wooed skittish fellow Democrats by telephone Friday, hoped to bring the full persuasive power of the presidency to bear in an 11th-hour push to secure the 218 votes needed to prevail in the House of Representatives.

    “The sales pitch is simply that we’re on the cusp of the type of health care reform that this country has been talking about for decades,” said White House spokesman Robert Gibbs. “Do this for the country. Do this for your constituents.”

    Democratic leaders set the stage for a final vote late Saturday on the 10-year, 900-billion-dollar measure, the most ambitious overhaul of its kind in a half-century, but said Republican delaying tactics could stall the process.

    Democratic House Majority Leader Steny Hoyer said that he did not have the votes but was “very close,” and added that he had cautioned lawmakers the final ballot may be pushed to Sunday, Monday or Tuesday.

    According to The New York Times, as of Friday evening, Democratic leaders in the House counted about 205 certain votes, but were hoping to secure the remaining 13 in negotiations Friday and Saturday.

    Democrats wrestled with an intra-party feud over whether government monies would go to funding abortions, after dispatching another dispute over ensuring that undocumented immigrants did not gain new benefits.

    Late Friday, they announced a compromise over the abortion issue, saying a floor vote would be allowed on an amendment that would bar use of government money to cover abortion services.

    But The Washington Post argued it was “a risky decision that could determine the fate” of the whole reform package.

    According to the paper, the amendment was expected to pass with the combined support of more than 40 anti-abortion Democrats and all House Republicans — but was almost certain to infuriate a much larger group of Democrats who support abortion rights.

    Republicans vowed to stay united and hoped to peel off the more than 40 swing-vote Democrats they need to defeat the legislation, which would deal a severe blow to prospects for a health care overhaul.

    Republicans said any postponement of the vote would reflect Democrats’

    inability to wrangle the support needed to pass the bill within their self-imposed timetable.

    Even if Democrats squeeze the measure through, it must still clear the Senate, where Democratic Majority Leader Harry Reid faces more daunting obstacles and has hinted any action could slip to 2010.

    That would put the issue front-and-center in the 2010 mid-term elections, when one-third of the Senate, the entire House of Representatives, and many US governorships are up for grabs.

    The United States is the only industrialized democracy that does not ensure that all of its citizens have health care coverage, with an estimated 36 million Americans uninsured.

    And Washington spends vastly more on health care — both per person and as a share of national income as measured by Gross Domestic Product — than other industrialized democracies, according to the Organization for Economic Cooperation and Development.

    The United States spent about 7,290 dollars per person in 2007, more than double what Britain, France, and Germany spent, with no meaningful edge in the quality of care, and lags behind OECD averages in key indicators like life expectancy and infant mortality.

    Under the White House-backed bill, Americans would have to buy insurance and most employers would have to offer coverage to their workers — though some small businesses would be exempt and the government would offer subsidies.

    The measure includes a government-backed insurance plan, popularly known as a “public option,” to compete with the private insurance industry.

    The non-partisan Congressional Budget Office says the bill, as written, would cut the budget deficit by about 100 billion dollars over 10 years while extending health care coverage to 96 percent of all Americans.

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    Generali’s chief executive, Giovanni Perissinotto, said Friday that the company is ready to pay a dividend on future results, reiterating that the payout ratio target is between 40%-45%.

    Speaking during a conference call to present the insurer’s third-quarter results, Perissonotto said that a decision on the dividend will be taken next year at a board meeting to approve full-year results.

    Generali’s board, whose mandate is set to expire in April 2010, is going to meet in March to approve its full-year results.

    Generali’s chief financial officer, Raffaele Agrusti, said that the capital gain from the sale of the stake Generali held at Intesa Vita, the bancassurance joint venture with Intesa Sanpaolo that was dissolved earlier this year, is somewhere between EUR50 million and EUR60 million.

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    US jobless insurance claims are trending lower from a March peak, official data confirmed Thursday, but unemployment within a fraction of 10 percent challenges recovery from recession.

    A pair of Labor Department reports highlighted the grim conditions on the job market, where nearly one in 10 in the labor force are out of work.

    New claims for jobless benefits dropped more than expected to a seasonally adjusted 512,000 during the week ended October 31, the first decline following two weeks of increases and the lowest level since January 3, when claims stood at 488,000. Continuing claims also fell.

    Separately, nonfarm productivity soared a more than expected 9.5 percent in the third quarter to the highest level in six years as companies shed staff.

    The reports came on the eve of the department’s anxiously awaited October labor report. Most analysts expect the unemployment rate to rise to 9.9 percent, up from a 26-year high of 9.8 percent in September. Some suggest it hit the psychological double-digit barrier of 10.0 percent.

    Economists and the Obama administration have warned unemployment was likely to continue to rise even as the economy emerges from the worst downturn since the Great Depression.

    The high number of jobless constrains consumer spending, which traditionally drives two-thirds of US economic activity, thus dampening momentum in a fragile recovery that began in the third quarter.

    “The slow but fairly steady drop in unemployment insurance claims is signaling that a long and painful recovery is underway,” said Andrew Gledhill at Moody’s Economy.com.

    Since the start of the recession in December 2007, the number of unemployed has increased by 7.6 million to 15.1 million, according to official data.

    Joel Naroff of Naroff Economic Advisors said the productivity data indicated businesses would not be hiring anytime soon.

    “There is a downside to the drive for efficiency: Hiring is likely to remain limited for quite some time,” he said.

    “The labor market is still in a very grim state,” declared Ian Shepherdson of High Frequency Economics.

    “After three slightly disappointing weeks we were starting to worry a bit about the speed of the downward trend in claims, so these data are comforting, though not definitive,” he added.

    Theresa Chen of Barclays Capital agreed the overall trend was improving.

    “While some of the fall in continuing claims is likely due to claimants exhausting benefits and spilling over to federal extended unemployment insurance, we view the steady decline of initial claims, along with the trend down in continuing claims and the insured unemployment rate, as signals of labor market improvement,” she said.

    Other reports this week suggested stabilization was underway.

    Payrolls firm ADP said its survey showed the US private sector shed 203,000 jobs in October, the seventh month in a row that employment declines were smaller than in the previous month.

    A purchasing managers survey by the Institute of Supply Management said the US services sector, which makes up the bulk of the nation’s economy, expanded in October for the second month running but at a slower pace.

    “Final reports before nonfarm payrolls hint at better jobs number, perhaps much better,” said Robert Brusca of FAO Economics.

    Moody’s Gledhill, though, warned of the long, painful road ahead.

    “Once jobs resume growing, it will take until 2012 before the economy has made up for this recession’s losses,” he said.

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    To apply for an EHIC you will need to provide your name, date of birth and NHS or National Insurance number. In Scotland the NHS number is known as the Community Health Index or CHI number and in Northern Ireland it is known as the Health and Care number.

    You are also able to apply for an EHIC for your spouse or partner and any children up to the age of 16 (or 19 if they are in full-time education) whom you have or care for at the same time as applying for your own card. You must be over 16 to apply as a main applicant.

    If you lose or have your EHIC stolen within the UK then you will need to apply for a replacement. If it is lost or stolen abroad then you will need to apply for a replacement upon your return to the UK. If you require healthcare whilst you are abroad and have lost or had your EHIC stolen, then you will need to contact the Department for Work and Pensions in the UK and obtain an EHIC Provisional Replacement Certificate.

    If you need to renew your EHIC then you can do this no more than six months before it expires. If you wish to change any details on your EHIC, for example a change of name due to marriage or divorce, then you will need to obtain a replacement EHIC.

    Apply online now – application processed within 7 working days

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    Despite spending more than twice as much as other developed countries, the United States still lags behind in terms of access and quality, an international survey said Wednesday.

    Insurance restrictions and health care costs make US patients more likely than people in 10 other countries to struggle to receive treatment, according to the annual survey of over 10,000 primary care physicians.

    “We spend far more than any of the other countries in the survey, yet a majority of US primary care doctors say their patients often can’t afford care,” said lead author Cathy Schoen, senior vice president of the Commonwealth Fund.

    Some 58 percent of primary care doctors in the United States said their patients have trouble paying for care and medication, compared to five to 37 percent in the other countries.

    The study, published in the journal Health Affairs, comes as US President Barack Obama faces a pitched and prolonged battle in Congress over his plans to reform the country’s health care system.

    The United States is the only industrialized democracy that does not ensure that all of its citizens have health care coverage, with an estimated 36 million Americans uninsured.

    Yet the country spent about 7,290 dollars per person in 2007 — more than double expenditures by Britain, France and Germany — with no meaningful edge in the quality of care as it lags behind in life expectancy and infant mortality, according to the .

    Half of US doctors were found to spend “substantial” time addressing restrictions insurance companies place on the care of their patients in the study.
    “The survey provides yet another reminder of the urgent need for reforms that make accessible, high-quality primary care a national priority,” said Commonwealth Fund President Karen Davis.

    US physicians are at least four times more likely than their counterparts in countries like Australia, the Netherlands, Sweden and Britain to report major problems with the time spent getting patients needed care or medication due to the restrictions, it said.

    “The patient-centered chronic care model originated in the US, yet other countries are moving forward faster to support care teams including nurses, spending time with patients and assuring access to after-hours,” said Schoen.

    Almost all doctors surveyed from Britain, the Netherlands and New Zealand said they had arrangements for patients to see a doctor after normal business hours without having to go to the emergency room, a far more costly undertaking.

    But only 29 percent of US physicians — the lowest ranking in the study — said they offered such an arrangement.

    “Our weak primary care system puts patients at risk, and results in poorer health outcomes, and higher costs,” warned Davis.

    Most US primary care physicians also lack health information technology to access test results for their patients, help reduce medication errors and improve care, the study found.

    Only 46 percent of US doctors were found to use electronic medical records, compared to 99 percent of their colleagues in the Netherlands and 97 percent in New Zealand and Norway.

    Eleven developed countries — Australia, Canada, France, Germany, Italy, the Netherlands, New Zealand, Norway, Sweden, Britain and the United States — were surveyed for the study.

    The survey was conducted by mail, phone and online from February to July 2009.

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    The Met Office has issued a weather warning for North West England, Wales, Northern Ireland, Strathclyde, SW Scotland, Lothian & Borders.

    Heavy rain is expected from 0430 Thu 05 Nov to 1200 Thu 05 Nov.

    Local areas affected:

    • North West England: Cheshire, Halton, Merseyside, Warrington
    • Wales: Flintshire, Wrexham

    Showers will become heavy and persistent this morning, leading to 15mm falling in a 3 hour period in some places.

    The public are advised to take extra care and refer to the Highways Agency for further advice on traffic disruption on motorways and trunk roads, and are advised to take extra care, and refer to the latest Environment Agency, Floodline, and Flood Warnings in force.


    Local areas affected:

    • Northern Ireland: Co Antrim, Co Down
    • Strathclyde: Argyll + Bute, E Ayrshire, E Renfrewshire,    Glasgow,Inverclyde, N Ayrshire, Renfrewshire, S Ayrshire, W Dunbartonshire
    • SW Scotland, Lothian & Borders:    Dumfries, Galloway

    A band of heavy showers will spread across County Antrim and County Down during this morning with a risk of rainfall totals in excess of 15mm within a three hour period.

    The public are advised to take extra care and refer to the NI Rivers Agency for further advice on flooding, and also to Traffic Watch (NI) (operational hours 07:30 to 18:30 Mon to Fri) for further advice on road conditions.

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

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    DUAL Corporate Risks, a leading specialist directors & officers and professional indemnity underwriting agency for mid-market companies, has appointed Liz Hanlon to its DUAL Focus team.

    DUAL Focus provides specialist insurance solutions for more complex financial institution based risks.

    With 20 years’ industry experience, Liz Hanlon’s arrival will bring additional expertise to the existing suite of DUAL Focus products as well as adding a new range including Bankers Blanket Bond and Computer Crime.  Liz Hanlon joins from Argo-Heritage where she developed a diverse, mid-market financial institutions portfolio.

    Tim Bilborough, an existing member of the DUAL Corporate Risks underwriting team will be working with Ms Hanlon as part of the DUAL Focus Team.  Beth Whybrow also joins them from Argo-Heritage as assistant underwriter.

    Commenting on the announcement, Russell Kilpatrick, Executive Chairman of DUAL Corporate Risks, said:

    “Since its launch in April, DUAL Focus has gone from strength to strength with demand well exceeding expectations. Liz’s appointment will now secure the next phase of our development strategy for this account. She brings with her an enormous amount of experience and is very well regarded in the industry.  The bolstering of the DUAL Focus team will allow us to optimise these products and enable us to enhance the service we provide to our clients.”

    He added: “The new products which Liz will introduce will make DUAL Focus one of the leading financial institution portfolios available in the market.”

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    The FSA must act quickly to secure the benefits of its changes to the financial advice market, says the ABI.   The message comes in the ABI’s response to the FSA’s Retail Distribution Review (RDR) consultation.

    The ABI supports the principles of the RDR, which aim to widen access and improve the service consumers receive when accessing financial advice and investment products. The ABI supports the FSA’s plans to introduce Adviser Charging, under which firms would set and disclose their own charges, rather than receiving commission from product providers.  This would remove any bias, real or percieved, from the process and help rebuild consumer trust in financial advice.  The ABI also supports the FSA’s proposals to increase the professionalism of advisers.

    However, an unintended consequence of the reforms could be to restrict consumer access to advice.  To avoid this, the ABI has proposed the development of simplified advice processes to meet the needs of consumers who are unable to afford, or do not require, full advice.   To enable firms to develop these services, greater certainty is need from both the FSA and the Financial Ombudsman Service on how these processes would be judged.  Current FSA proposals for an individual facilitating this service to obtain the same qualification required as full financial advisers, would also prevent these processes being delivered at an affordable price.

    Maggie Craig, the ABI’s Director of Life and Savings, said: ”We have come a long way on the road to developing a clearer and more transparent advice market.  However, as we get closer to the introduction of RDR reforms in 2012, the FSA must realise that firms need clear rules and guidance now.  Given direction, firms can develop simplified advice processes, ensuring as many people as possible have access to financial advice.

    “The ABI has supported the objectives of the RDR since it began in 2006 and we continue to believe these changes are essential to rebuild consumer confidence in the retail investment market.”

    The ABI is also keen to ensure that the proposed RDR changes are not automatically applied to the protection market, unless it can be shown that doing so would benefit consumers.   The RDR was developed to tackle problems in the investment market, which do not necessarily exist for protection business.  Applying some of the RDR changes to the protection market would have an immediate and significant impact on consumers’ ability to access advice on these products.

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    The Association of British Insurers has appointed Kerrie Kelly as its new Director General, it announced today. Ms Kelly will take up the role in February 2010.

    Kerrie Kelly is currently Executive Director and CEO of the Insurance Council of Australia and is a respected figure in the international insurance world. She is a lawyer who has held senior executive positions in the private and public sectors with considerable experience working in the fields of banking and finance, and transport. She has led the Insurance Council of Australia since 2006 and was previously CEO of the Financial Planning Association in Australia. She currently holds several non-executive directorships in Australia including HSBC Bank Australia, the Financial Literacy Advisory Board, the Financial Ombudsman Service and the Finance Industry Council of Australia.

    The ABI’s Chairman, Archie Kane, who led the recruitment process, said: “Kerrie is a proven and energetic leader whose success across the commercial, legal and public sectors will ensure the ABI has a strong and powerful voice at its helm at a crucial time for the insurance industry. Along with her leadership experience, Kerrie will bring a unique perspective to the public policy debate in the UK and EU, and her lobbying expertise will ensure the insurance voice is heard in Westminster and Brussels.

    “Kerrie has a proven record of representing the insurance industry at the very highest levels and brings a strong network of international contacts which will prove particularly valuable as we navigate major areas of global regulation and supervision. I am delighted Kerrie is joining the ABI and have every confidence the organisation will go from strength to strength during her time as Director General.

    “I would also like to thank Stephen Haddrill for his very significant contribution to the ABI over the last four and a half years and wish him well in his new role at the Financial Reporting Council.”

    Kerrie Kelly said: “The ABI is a trade association with a strong reputation for effectiveness, policy strength and Board leadership. Stephen Haddrill has been a highly effective leader and ensured the ABI has punched its weight. I am determined to do the same and I am delighted to lead the ABI forward at such a crucial time for the insurance industry and the future of financial services generally.”

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    Aviva Investors, the global asset management business of Aviva plc, has called on stock exchanges around the globe to more actively promote corporate responsibility and transparency among the companies that are listed on exchanges.

    Speaking today at a major UN Conference* in New York – supported by UN Secretary General, Ban Ki-moon, and entitled “Sustainable Stock Exchanges” – Aviva Investors London CEO Paul Abberley, said that they hoped to galvanise concrete commitments from international stock exchanges and their listing authorities to work towards codifying how they could promote more responsible business.

    Mr Abberley said: “Our main focus is on promoting a global listing environment that requires companies to consider how responsible and sustainable their business model is, and also encourages them to put a forward looking sustainability strategy to the vote at their AGM**.”

    At the UN conference, Paul Abberley also announced a number of further responsible investor-focused initiatives that are designed to educate stock exchanges and the investment community on enacting sustainable business practices. These are:

    1. Analysis from Goldman Sachs Global Investment Research highlighting why sustainability data forms a material part of an overall investment decision, what key metrics they look for, and the nature of the problems they have in sourcing this data

    2. Analysis from CA Cheuvreux examining the business case for stock exchanges to update their listing codes, as well as how well prepared specific exchanges are for this agenda

    3. In collaboration with Maplecroft, a Sustainability Performance Benchmark based on the United Nations Global Compact, which following consultation will be available for use by mainstream analysts and civil society researchers

    4. In collaboration with EIRIS, a voting and engagement service that provides investors with recommendations on how to promote enhanced corporate responsibility via their voting.

    Paul Abberley added: “This conference is a direct outcome of Aviva Investors’ global CEO – Alain Dromer – calling for a debate on how stock market listing authorities could help promote increased corporate transparency in November last year. Aviva Investors has been using its vote on the report and accounts at company annual general meetings to promote better corporate responsibility information disclosure in the companies in which we invest since 2001.

    “However, we have generally lacked the support of Listing Authorities who play a crucial role in setting out what companies report to the market. Direct opportunities to vote at company AGMs on corporate responsibility reports are almost unheard of. I am strongly of the view that amending specific market listing codes in this way has the potential to make capital markets substantially more sustainable. We will continue to work with other likeminded institutions towards this end.”

    * The conference is convened by the United Nations Global Compact, the United Nations Conference on Trade and Development, and the Principles for Responsible Investment. For more information on the conference, see here: www.unpri.org/sustainablestockexchanges09/

    ** The main purpose of the proposed corporate responsibility reporting requirement – and the associated AGM vote – is to create the right kind of discussions within the boardrooms of listed companies around the world, and then between the company and its shareholders.. The proposal suggests the UN Global Compact as an appropriate framework for boards to consider, and that reporting be conducted on a “comply or explain” basis. The three key components to the mechanics of the AGM vote itself are: (i) the report would be published in its entirety or summarised in the Report and Accounts; (ii) the vote would be advisory; and, (iii) shareholders will be asked to approve the report.

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    UK companies need to invest more in training their HR teams and line managers to help them identify signs of stress in employees, according to the Aon – the UK’s leading insurance broker and employee risk management firm – speaking on National Stress Awareness Day 2009 on 4 November 2009. This will both promote wellness and productivity across the firm by helping staff return to work and cut healthcare costs through early intervention.

    Charlotte Bray, consultant for Aon Consulting and occupational health specialist, commented: “We’re beginning to see companies take a more proactive, self-help approach to managing stress by using employee assistance programmes for lifestyle advice and counselling. More training and workshops for managers means they can learn to identify stress at the early stages which can prevent conditions becoming chronic and are less likely to require drastic measures such as long term psychological or psychiatric help.

    “In turn this helps to reduce claims for private medical insurance and group income protection plans, while most importantly helping the employee to return to work. This needs to form part of a company’s overall wellness strategy, taking into account the objectives of the organisation and their ability to measure ROI.”

    Richard Brough, consultant for Aon Global Risk Consulting, added: “Stress management programmes are in their infancy. As a bare minimum, companies must have a policy to identify the symptoms with a clear stepped response to create a stress-aware culture. Stress can be caused by a variety of triggers and not necessarily stemming from work but showing you have stress management plans in place will help protect your employees and could help you defend a costly employers’ liability insurance claim.”

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    Swinton has responded to the Financial Services Authority’s announcement today of a fine of £770,000 in relation to sales of low cost Payment Protection Insurance policies.

    Swinton takes the matter very seriously and will be contacting all customers concerned. The company apologises to any customer affected, and has set up a dedicated unit to deal with the PPI cases.

    The company takes the view that the simple, low-cost PPI product it sold, (which cost £15 or £20), was different to that more commonly sold for many hundreds or even thousands of pounds alongside mortgages and loans in the rest of the financial services industry.

    The company did not deliberately set out to breach FSA rules or to disadvantage customers and acted in good faith in the development of its sales process which it believed was reasonable and proportionate for the low cost of the product. The total cost of the product was disclosed to customers and was in line with prices charged by other providers in the market for similar products. Swinton believes that the vast majority of its customers understood that the product was optional when offered to them and in fact, less than 50% of its eligible customers purchased the product.

    Swinton would also point out that the company itself initially brought issues with its sale of PPI to the attention of the FSA.

    In 2007, Swinton’s own monitoring identified that it had sold PPI to customers who may not have been eligible. Swinton informed the FSA of this issue and the FSA subsequently launched its investigation into Swinton’s sales process. Swinton proactively undertook a customer redress plan at this time writing to around 40,000 potentially ineligible customers reminding them of their purchase and offering a refund. Very few customers responded. Swinton believes that while there may have been breaches of the FSA requirements most customers were content with their decision to buy the policy. The company ceased all sales of PPI in March 2008.

    The FSA acknowledges that “Swinton has worked in an open and co-operative way with the FSA throughout the investigation”, that the company “pro-actively implemented a remedial action plan to provide redress” and that “the impact of any individual customer detriment from a non-compliant sale of such a product would have been low”.

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    Following an extensive consultation, the ABI has today launched a new investment fund sector, the Deposit & Treasury sector. The new sector contains funds that have capital stability as their overriding objective.

    The new sector will function alongside the existing Money Market classification. Funds within the new sector can only invest in relatively simple instruments such as Government bonds or fixed term savings vehicles. All funds must invest in instruments that are denominated in sterling and have a maximum duration of 12 months. The ABI has produced a guide on the new sector for consumers and advisers at www.abi.org.uk

    Maggie Craig, the ABI’s Director of Life and Savings, said: “The Deposit & Treasury fund sector has been established in direct response to consumers’ wishes. It makes things simpler through clearer labelling, helping consumers looking for funds that offer stability. Whilst no investment is risk free, this new classification should be a great help in these times of financial volatility.”

    The ABI’s Life and Pensions fund sectors are a method of categorising investment funds. Each sector has clear criteria that must be followed by funds within it. There are currently 34 ABI fund sectors, with over 7,000 funds individual classified within them. Each sector contains funds that have similar investment strategies, making it easier for consumers, and advisers, to identify the funds that suit their requirements.

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    CEIOPS’ Members endorsed in today’s meeting the proposal to run a EU-wide stress test in the insurance sector in December 2009.

    CEIOPS will continue to develop the exercise in close cooperation with the industry representatives aiming to deliver it’s findings to the EU political level at their meetings to be held throughout the first quarter of 2010.

    The objective is an EU-wide exercise with common guidelines and scenarios, so as to increase the level of aggregate information among policy makers in assessing the European insurance sector’s potential resilience to shocks and to contribute to the convergence among supervisory practises.

    The EU-wide stress test for the insurance sector will be conducted in December 2009 for large and important insurance groups in Europe. Three scenarios will be tested. An adverse scenario mirroring the development of capital markets between end- September 2008 and end-September 2009. The second scenario reflects a more severe and prolonged recession and the third scenario reflect a situation of inflation picking up rapidly leading to a steep rise in interest rates. The stress test will focus on market and credit risks.
    Notes:
    On 5 November 2003, the European Commission adopted the decision, to establish the Committee of European Insurance and Occupational Pensions Supervisors, which entered into force on 24 November 2003. Today this decision is repealed and replaced by Decision 2009/79/EC. The Committee is composed of high level representatives from the insurance and occupational pension funds supervisory authorities from the EU and EEA Member States, chaired by Gabriel Bernardino, who is supported by a Vice Chair and four other members in a Managing Board.

    CEIOPS fulfils the functions of the Level 3 Committee for the sector of insurance and occupational pensions in application of the Lamfalussy Process. This includes in particular: Providing advice to the European Commission, in particular in its preparation of draft implementing measures in the fields of insurance, reinsurance and occupational pensions, contributing to the consistent implementation of community legislation in the Member States and improving co-operation among Supervisory Authorities, including the exchange of information on supervised institutions.

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    Fast expensive cars such as BMWs and Porsches are the biggest target for vehicle vandals, it was revealed this week. And London is the place that the highest number of malicious damage claims are made by drivers, a survey by a car insurance company showed.

    Based on more than 25,000 malicious damage claims over the last five years, the survey revealed that the BMW Z3 is the most-vandalised car, followed by the Chrysler Crossfire and the Porsche Cayenne.

    A spokesperson for the company that carried out the research said, “It would appear that certain models are more likely to be vandalised than others. Our research shows the top 10 is made up entirely of either expensive luxury cars or soft tops.

    “It could be that luxury cars are targeted because of old-fashioned envy. Sadly some people are jealous of those who drive expensive cars, while in the case of convertibles, they are an easy target. It’s relatively simple to slash a fabric roof or PVC window.

    “But we don’t want to worry car owners with these types of cars. Thankfully this sort of car crime is still relatively rare.”

    These are the top 10 models for which the most malicious damage motor insurance claims have been made over the last five years:

    1. BMW Z3

    2. Chrysler Crossfire

    3. Porsche Cayenne

    4. Porsche Boxster

    5. BMW Z4

    6. Ford Streetka

    7. Honda S2000

    8. Smart Forfour

    9. Audi TT

    10.MG MGF

      0 0

      Britain’s biggest retailer Tesco said Wednesday that it will create 1,000 jobs at a new customer services centre for its banking division in Newcastle, northeastern England.

      “Tesco Bank is creating 1,000 new jobs in Newcastle following a decision to establish a customer service centre in the city,” Tesco said in a statement.
      The first 500 posts will be created by the end of 2010.

      The government’s Business Secretary, Peter Mandelson, applauded the announcement.

      “I welcome this decision and I am proud of the government support that has helped make it happen,” Mandelson said in the statement.

      “The jobs created by this investment will be invaluable to the north east and to the wider UK economy.”

      The new centre at the Quorum Business Park in Newcastle will handle sales and services for Tesco Bank’s home and motor insurance customers.

      The banking division recently created 800 new jobs at a separate facility in Glasgow, as well as 200 additional positions in Edinburgh.

      Tesco Bank, which provides credit cards, insurance policies, small loans and savings accounts, has almost six million customers in Britain.

      Tesco, the third largest supermarket in the world, is hoping to attract more customers away from Britain’s traditional banking sector amid widespread public anger over the global financial crisis and subsequent recession.

      The group bought Royal Bank of Scotland’s 50-percent share in their former joint venture, Tesco Personal Finance, for 950 million pounds (1.4 billion
      dollars) last year.

      Earlier this month, the supermarket chain relaunched the financial services division as Tesco Bank.

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