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The EU will announce dramatic measures that will put an end to premium charges when using mobile data services in the EU, making it cheaper for people with smartphones to use internet on their devices whilst abroad. The new data roaming charges will cost no more than 81p per megabyte when the new ruling comes into force on 1 July 2012 and will fall to around 40p by 2014.

Ernest Doku, technology expert at uSwitch.com, says: “This has not come a moment too soon. People have been paying extortionate prices for the privilege of using their mobile abroad and millions have been stung by a nasty bill on their return.

“Even though the EU made a tentative first step to curb costs last year through the introduction of the €50 cap, it didn’t go far enough. The cap simply limited the amount people could use their phone, rather than the high prices they were being charged. By lowering call and text charges to a manageable level, consumers now have the freedom to roam at an affordable cost. With more than ten million smartphones now in circulation in the UK, this will be welcome news to gadget lovers.

“Holidaymakers will be able to seek better roaming deals when abroad by using a different network, while keeping their same phone number and SIM card. This will inject much needed competition into the market and minimise bill shocks for mobile users in the future. It’s just a shame that the Commission had to force the hand of the operators to achieve this.

“People should still note that this ruling doesn’t cover popular holiday destinations in Europe such as Turkey nor many countries further afield.  Wherever you are going, it’s still well worth contacting your network before you travel to ensure that you fully understand the cost of using your phone while you are away. Switch off your voicemail and roaming options unless you really need to use them, and remember that international and local SIM cards are a great way to making calls while abroad as you can benefit from far cheaper rates.”

Source : uSwitch.com

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China is expected to become the second-biggest insurance market in the next 10 years, reinsurer Swiss Re said on Wednesday, noting that the Asian giant posted growth of 26.2 per cent in 2010 premiums.

“The global market share of emerging countries is expected to continue to increase strongly from today’s 14 per cent over the next 10 years,” said the reinsurer in its study on the insurance industry.

“China is likely to become the second largest insurance market within a decade,” it added.    The Asian giant is now the ranked sixth, with insurance penetration at 3.8 per cent, far below the 10.1 per cent in Japan, 10.5 per cent in France and 12.4 per cent in Britain.

Overall, global life insurance premiums were up 3.2 per cent at $2.52 trillion in 2010, while non-life premiums increased by 2.1 per cent at $1.82 trillion.

“The economic recovery should continue and bolster premium growth in the life and non-life sectors globally in 2011,” said the reinsurer.

Zurich, July 6, 2011 (AFP)

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The European Union banned  Egyptian fenugreek seeds linked to E.coli outbreaks in Germany and France and  slapped a temporary ban on the import of all seeds and beans from the country.

The decision followed a report earlier in the day from the European Food  Safety Authority (EFSA) linking a batch of Egyptian fenugreek seeds to  outbreaks in the two countries.

“The report published today leads us to the withdrawing of some Egyptian  seeds from the EU market and to a temporary ban on imports of all seeds and  beans originating from that country,” said health commissioner John Dalli.

The outbreaks, which has left 49 dead and affected 4,178 people in the EU,  Norway and Switzerland, has been blamed on a 15-tonne batch of Egyptian  fenugreek seeds imported in 2009 to Germany, and then distributed elsewhere.

Withdrawal of the suspect seeds implies not only a ban on their sale but  also their destruction.

The temporary import ban, to be enforced until October 31, hits all  Egyptian seeds, fruit and spores used for sowing — including soya beans,  dried leguminous vegetables and oil seeds.

The EFSA earlier said “that one lot of fenugreek seeds imported from Egypt  and used to produce sprouts is the most likely common link between the two  outbreaks” in France and Germany.

“However, it cannot be excluded that other lots of fenugreek imported from  Egypt during the period 2009-2011 may be implicated,” it added.

EFSA recommended “that forward tracing be carried out in all countries  which may have received seeds from the concerned lots.”

It also advised consumers against growing sprouts for their own consumption  or eating sprouts or sprouted seeds unless cooked thoroughly.

The EFSA report noted that the contamination probably occurred before the  seeds left the importer.

“The production or distribution process apparently allowed contamination  with faecal material of human and/or animal origin. Where exactly this  contamination occurred is still unknown,” the EU said.

Dalli said the commission would continue to monitor the situation very  closely and would take additional measures if necessary.

Egypt’s ministry of agriculture last week denied fenugreek seeds sold to  Europe had caused the virulent strain of enterohaemorrhagic E.coli (EHEC),  with the head of its Central Administration of Agricultural Quarantine, Ali  Suleiman, dismissing first reports as “completely untrue.”    He said the Egyptian company that exported the seeds in 2009 had said it shipped the fenugreek to Holland and not to Germany, Britain or France.

The World Health Organisation has confirmed some 4,050 infections in 14  European countries, the United States and Canada — more than 3,900 of them in  Germany.

All but two of the fatalities have so far been in Germany, apart from one  case in the United States and a woman who died in Sweden shortly after  returning from a visit to Germany.    Seven people were infected in France with E.coli after eating vegetable  sprouts at a leisure centre near Bordeaux.

Brussels, July 5, 2011 (AFP)

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Nippon Life Insurance Tuesday said it will  invest around 500 million euros ($725 million) in German insurer Allianz, as  the Japanese firm looks to expand globally to find growth opportunities.

Japan’s largest life insurer by revenue said it will spend the money,  approximately 60 billion yen, on 30-year convertible subordinated bonds issued  by an Allianz subsidiary, that can be converted into shares.     The transaction will be completed by July 7 and by exercising the  conversion right, Nippon Life will be able to obtain Allianz common shares at  any time within next 10 years, it said.

Based on current share prices, Nippon Life could end up with a stake of  between one and two percent in Germany’s largest insurance group, Dow Jones  Newswires reported.

Japan’s saturated life insurance sector is looking to expand beyond the  nation’s borders at a time when the population is shrinking.

“We will seek opportunities to work together in various areas with Allianz  through continuous interaction including exchange of personnel,” Nippon Life  said in a statement.

Tokyo, July 5, 2011 (AFP)

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More than half of Brits (58 per cent) are unaware of the benefits of having the European Health Insurance Card (EHIC) when holidaying in Europe, according to research by moneysupermarket.com.

A third of Brits (33 per cent) incorrectly think the E111 will cover them for free or reduced cost medical treatment in the EU and EEA countries; despite the E111 being replaced in January 2006 by EHICs. A further four per cent believe their passport can be used, while three per cent believe an NHS patient card will cover them.

European Health Insurance Cards are only valid for five years and therefore have to be renewed once they’ve expired. Anyone who applied for their card in 2006 or earlier will need to renew their card now as they are already out of date, or due to expire soon.   There could be around 6 million cards that need to be renewed already this year. Ensure you check your card is in-date before your think about travelling and if you find it has expired you need to leave yourself enough time to renew it. EHICs entitle UK citizens to the same state-provided medical treatment as a local resident receives in other EU or EEA countries, yet only 42 per cent of Brits are familiar with it.

An EHIC card is free and available through the NHS Choices website.

Bob Atkinson, travel insurance expert at moneysupermarket.com said: “Brits hitting Europe this summer without an EHIC could end up facing a hefty bill if they need medical care while they’re on vacation. Medical treatment in the EU and EEAs varies from country to country as well as being very different to NHS provided care in the UK. An EHIC is your ‘pass’ to get free or reduced cost medical treatment in any EU or EEA country. Holidaymakers will suffer unexpected financial pain if they don’t ensure they have the right documents and produce them when seeking treatment.

“It’s encouraging to see that EHIC awareness is starting to improve – in 2009 our research showed only 35 per cent of Brits understood an EHIC would help them with medical costs if needed. But our findings show there is clearly still a long way to go to get the message across.”

The research also found a clear generational divide amongst holidaymakers; almost a quarter (23 per cent) of under 35s incorrectly think the E111 will give them free or reduced cost medial treatment compared to well over a third (39 per cent) of over 55s.

Bob Atkinson continued: “Like the E111 before it, the EHIC only offers relatively low level access to medical treatment. Holidaymakers shouldn’t view it as a replacement for travel insurance, and travellers should also be aware that any non-essential care or treatment can cost extra. The cost for many serious accidents, extensive treatment and the need for air ambulance repatriation will not be covered by the EHIC and the costs for this can run into tens of thousands of pounds.

“As well as offering much more comprehensive medical treatment cover, travel insurance offers holidaymakers the peace of mind that they are covered for lost or stolen possessions, holiday cancellations, personal liability and a range of other costly possibilities. Therefore holidaymakers should lessen the risk of having to pay expensive medical bills by having both an EHIC and a valid private travel insurance policy that covers Europe. Cover provided by EHICs varies considerably from country to country so it’s worth finding out what you would be eligible for prior to travelling to your destination.

“Anyone travelling outside of Europe has only travel insurance to rely on. Having an EHIC is of no benefit what so ever in countries beyond the EU and EEA. Travel insurance can be purchased for around £10 for a family of four travelling to Spain for a week or if travelling further afield, cover for a family of four for two weeks in the US will cost from as little as £30. For such a small outlay the amount of cover you can get from a policy is huge. I urge everyone travelling on holiday to take out adequate travel insurance, it really is worth investing in protection for you and your family just in case the worst should happen.”

Moneysupermarket.com recommends at least the following level of travel insurance cover:

– 2m for medical expenses

– £1m personal liability

– £3000 cancellation – or enough to cover the total cost of your holiday

– £1500 baggage

– £250 for cash

– Policy excesses under £100

– Cover for scheduled airline failure and end supplier failure as desirable

– Delay cover (e.g. £20/hour for first 12 hours).

Brits can usually get a free EHIC within seven days if they apply on the ehic.org website or at 0845 606 2030. Filling out a form at the post office adds two weeks to the process. The EHIC is valid for up to five years in all European Economic Area (EEA) countries and Switzerland, but does not include the Channel Islands so holidaymakers heading there would need travel insurance in place.  Holidaymakers should also keep an eye on the expiration date.

Source : Moneysupermarket.com

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EIOPA announces the results of its second European insurance stress test. The exercise confirms that the insurance market in Europe covered by the stress test is robust.

Between March and May, EIOPA tested insurers’ ability to meet the future Solvency II Minimum Capital Requirements (MCR), the ultimate regulatory threshold, under a number of stress scenarios. The stress scenarios comprised market, credit and insurance-related risks. Simultaneously, EIOPA performed a supplementary test to evaluate sovereign bond exposures. EIOPA emphasises that the stress test is based on hypothetical and severe stress scenarios and is not a forecast of what is likely to happen.

The results of this stress test indicate that overall the European insurance market is well prepared for potential future shocks as tested in this exercise. However, data showed that approximately 10% (13) of the participating groups and companies do not meet the MCR under the adverse scenario. 8% (10) fail to meet the MCR in the inflation scenario.

Based on data as of 31 December 2010, the European insurers which participated in the stress test showed an aggregate solvency surplus of €425 billion before the stress test scenarios are applied. The aggregate surplus decreases to €275 billion (minus €150 billion) when the adverse scenario is applied and to €367 billion (minus €58 billion) in the inflation scenario.

The insurance groups and companies who did not meet the MCR threshold show a solvency deficit of €4.4 billion if the adverse scenario were to occur and €2.5 billion if the inflation scenario were to materialise.

At the aggregate level, EIOPA identifies the main drivers of the results as being adverse developments in equity prices, interest rates and sovereign debt markets. On the liability side, non-life risks are more critical, triggered by increased claims inflation and natural disasters.
Sovereign bond exposure was covered separately in a supplementary test. The results of the shock on sovereign bond yields show that approximately 5% (6) of the participating groups and companies would not meet the MCR. The aggregate surplus of €425 billion decreases to €392 billion (minus €33 billion) in this particular scenario.

While the exercise was completed by 221 insurance and reinsurance groups and companies, headquartered in the European Union, Iceland, Liechtenstein, Norway and Switzerland, the results reported are for 58 groups and 71 companies due to aggregation of the results of companies within groups. This represents approximately 60% of the overall European insurance market and is above EIOPA’s aim to include at least 50% of the insurance market of each country as measured by gross premium income.

EIOPA emphasises that it is important to consider that the stress test is based on a future regulatory system and is not necessarily indicative of any current solvency problems. It rather highlights an exposure to the hypothetical risks and must be understood in the light of the current status of Solvency II during the development of the fifth Quantitative Impact Study. Over the coming months, the National Supervisory Authorities will discuss the results of the stress test with individual insurers.

Source : EIOPA

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More Th>n launched a new Home Emergency Service to give homeowners peace of mind in the event of a crisis such as a burst pipe or electrical fault.

More Th>n ‘s Home Emergency Service, will provide reliable expert tradesman to fix problems 24 hours a day, seven days a week.  Any immediate repairs, up to the value of £1,000, will be undertaken to make homes safe and secure following incidents.  All permanent repairs carried out will come with a one year guarantee on any parts fitted.

Matt Pernet, Head of More Th>n Home Insurance said: “Finding a reliable tradesman in an emergency situation can be both extremely stressful and very costly. Our new Home Emergency Service means that should our customers find themselves in a crisis all they have to do is pick up the phone and help will be on the way.”

More Th>n customers will be covered for a whole host of emergency situations including blocked drains, broken pipes, failure of a main heating system, leaking roof, removal of vermin, loss of keys and in the event that a boiler is beyond repair, £500 will be paid towards the cost of a replacement. Should a customer’s home become uninhabitable or unsafe, emergency overnight accommodation costs will be also be covered.

Source : More Th>n

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Project developer Exorka, insurance broker Marsh and Munich Re have jointly developed an insurance concept covering the exploration risk of a geothermal energy project in Taufkirchen, near Munich. Drilling operations have now begun. Munich Re is once again assuming the significant risk of failure that thermal heat drilling entails. The policy was negotiated in collaboration with Marsh.

Deep geothermal heat is considered a very promising form of renewable energy. It involves pumping hot water from strata at a depth of up to five kilometres to the earth’s surface, where it is used to generate heat and/or electricity. However, the substantial drilling and development costs associated with this technology often constitute a huge investment barrier because there is a high risk of not making a find, in which case the investment is lost. Munich Re is providing cover for this risk for a geothermal energy project in Taufkirchen and is utilising one of its primary insurers to realise the insurance solution.

Exorka GmbH from Grünwald, the general contractor, has been commissioned to deliver a turnkey combined heat and power plant, including drilling operations, to GeoEnergie Taufkirchen GmbH & Co. KG. The deep geothermal energy drilling will be carried out by drilling-technology specialist Daldrup & Söhne AG, which recently successfully completed drilling operations for the neighbouring Grünwald/Oberhaching project. The output of the existing biomass power plant is to be increased by 20 MW to 80 MW with the aid of geothermal heat. GeoEnergie also plans to produce electricity. To achieve this, strata containing hot water at a depth of four to five kilometres will be tapped, the water being pumped back into the depths once it has been used, creating a closed water cycle. Up to four wells are planned at a cost of around €35m. Whether this outlay is worthwhile for investors depends on whether water is found underground that is hot enough and available for exploitation in substantial quantities.

Insurance broker and risk consultant Marsh, which has been advising project developer Exorka for four years, ascertained the insurable risks of the Taufkirchen project and prepared them for the insurance market. “A further milestone has been achieved in that we have been able to involve Munich Re in this project, based on our special concept – recognised in the field of deep geothermal energy – for the critical exploration risk”, commented Siegmund Fahrig, head of Marsh GmbH. “This underscores Marsh’s market leadership as a consultant dealing with exceptional renewable energy risks.”

Munich Re has set up a dedicated geothermal energy team since developing the world’s first exploration policy in 2003, and regards itself as a know-how leader in this field. Munich Re Board member Thomas Blunck: “With our expertise, we can also assume renewable energy risks that are not everyday occurrences and thus help provide greater investment security.” Munich Re’s renewable-energy commitment fits in seamlessly with the focus of the company, which has declared climate change a strategic topic. Blunck: “We see climate change not only as a risk but also as a great opportunity, because if climate protection is pursued resolutely, new technologies will have significant growth potential.” This will produce substantial business opportunities for Munich Re, as most investors would be unwilling to commit funds unless special insurances were in place.

Geothermal heat offers an almost inexhaustible source of energy. Germany has three regions that are considered particularly suitable for deep geothermal projects: the Molasse Basin south of Munich, the Upper Rhine Rift, and the North German Plain. With a power and heat output of 38 MW, Germany’s largest geothermal power plant to date was built in Unterhaching near Munich in 2003 – already insured as a pilot project at that time by Munich Re, and since 2005 also a client of Marsh.

Source : Munich Re

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United Insurance Brokers has appointed Tony Dilley as International Operations Director.

He will assume responsibility for the running of all UIB’s international offices with successful implementation of agreed group strategies.

Dilley was most recently at Travelers where he spent 18 years in a variety of roles, including CFO and COO for all international (non-US) business. His responsibilities at Travelers included operations on five continents with combined premiums of $1.5bn. Prior to Travelers, Dilley spent five years at brokers Sedgwick Group.

In his role at UIB, he will oversee the activities of offices throughout Europe, Asia, India, North Africa, South America and the Middle East, ensuring that there are increasing levels of coordination at group level. The title of International Operations Director is a new position, reporting directly to UIB Group CEO Bassem Kabban.

Tony Dilley said: “UIB is a very exciting company to join – there is a lot going on and a lot we can get moving on. I will be assessing the strengths of existing offices and making the most of every part of the company’s diverse international network in order to assess future focus and resource. I have a finance background, so this will start with the story the numbers are telling.”

Dilley’s appointment reflects UIB’s view that insurance placement is moving away from major traditional markets and towards emerging indigenous markets.

He added: “The focus of wealth creation is shifting and insurers are moving to follow this trend. It is sensible therefore that we as brokers move with them and that we do so in a professional and nimble way. UIB can do that very well as it is independent and doesn’t have some of the pressures of a public company. We can move quickly and use our excellent lines of communication, while ensuring that our service remains innovative and non-commoditised.”

David Trezies, UIB Group Chairman, said: “We are delighted to welcome Tony to the team and his international reputation speaks for itself. His presence at UIB demonstrates the depth of experience throughout the company, as well as our high standards and commitment to our customers.”

Source : UIB

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About 10 per cent of European insurance companies tested do not have enough capital to withstand exceptional economic shocks, results published by the sector regulator showed on Monday.

But with a success rate of 90 per cent, “overall, the European insurance sector remains robust in the occurrence of major shocks,” the European Insurance and Occupational Pensions Authority (EIOPA) said.

The tests examined 221 insurance and re-insurance companies which account for about 60 per cent of the overall insurance market in the 27 members of the European Union plus Iceland, Liechtenstein, Norway and Switzerland.    They incorporated stricter criteria for capital requirements that are to take effect in January 2013 under so-called Solvency II regulation but which have not yet been finalised.

Of the insurance companies tested, “data showed that approximately 10% (13) of the participating groups and companies do not meet the MCR (minimum capital requirements) under the adverse scenario,” the statement said.

“Eight per cent (10) fail to meet the MCR in the inflation scenario,” it added in reference to a hypothetical case in which inflation forced central banks to quickly raise their interest rates.    “The insurance groups and companies who did not meet the MCR threshold show a solvency deficit of EUR4.4 billion ($6.38 billion) if the adverse scenario were to occur and EUR2.5 billion if the inflation scenario were to materialise,” the statement said.

The test scenarios included market, credit and insurance-related risks.

EIOPA carried out an additional test to evaluate sovereign bond exposures, it said.

The regulator underscored that the tests were based on hypothetical and severe stress scenarios and were not a forecast of what it expected to happen.

It published aggregate results for the entire market, rather than use a company-by-company format for banks that are expected sometime this month.

Frankfurt, July 4, 2011 (AFP)

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AXA Wealth is introducing a flexible drawdown option for eligible members of its family SIPP ; the AXA Wealth Family Suntrust (‘FST’).

As of July 4 2011 this option follows changes to drawdown rules announced in April this year, which gave investors greater independence and flexibility for drawing income in retirement.

AXA Wealth FST was launched in 2009 to offer a number of investment options and retirement solutions to groups of people who want to invest together. The members of an AXA Wealth FST scheme invest together through a pooled fund which is managed as one portfolio.

Prior to the introduction of flexible drawdown, pension income withdrawals were capped based on the age of the saver and GAD limits. Flexible drawdown offers eligible individuals greater access to their pension pots and allows real independence – unlimited withdrawal from a pension fund for those members who meet the qualifying conditions.

Under AXA Wealth Family Suntrust flexible drawdown is typically available to members if:

– They are aged over 55

– They have a minimum fund size of £50,000 available for retirement benefits

– They satisfy the minimum income requirement at the relevant date

– No contributions are paid to any money purchase schemes by or on their behalf in the tax year in which the declaration is made for flexible drawdown

– at the time of the declaration for flexible drawdown, the individual is not an active member of a defined benefit or cash balance scheme.

Mike Morrison, head of pensions development, AXA Wealth, said: “This year, Independence Day has a whole new meaning at AXA Wealth. In the past HMRC has been insistent that tax relief is given to pension schemes on the basis that the accrued fund is used to provide a lifetime income. The introduction of flexible drawdown is a real step forward for those who can fulfil the minimum income requirement.

“Flexible drawdown opens the door to real flexible income and tax planning particularly when used in conjunction with other tax efficient investments. This could be the product that high net worth investors have been waiting for – giving adviser’s the ability to look at all of a client’s investments and to design an income and investment strategy across the whole retirement portfolio.”

Source : AXA

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The results of European insurance group stress tests will be released next week, the European Insurance and Occupational Pensions Authority (EIOPA), said on Friday.

The tests have examined more than 200 insurance and re-insurance companies that account for more than half of all premiums taken in in the 27 members of the European Union plus Iceland, Liechtenstein and Norway.

They incorporate stricter criteria for capital requirements that are to take effect in January 2013 under so-called Solvency II regulation but which has not yet been finalised, a statement said.

The tests aim to gather information on how well the insurance sector would withstand “adverse developments,” and “due consideration was given to aligning the macro-economic assumptions with those applied to the stress test in the banking sector,” it added.

Last year, the 28 insurance companies tested were deemed solid enough to withstand the most pessimistic scenarios under consideration.

EIOPA said it would publish “preliminary aggregated results” rather than use the company-by-company format for banks that are expected sometime this month.

Frankfurt, July 1, 2011 (AFP)

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Students will take over £800 worth of valuables with them to music festivals this summer according to a new survey published by the number one student insurance provider Endsleigh.

The essential item for the festival goer is their mobile phone – every student Endsleigh surveyed said they will be taking one with them and over a third (37%) said they will be taking more than one. A digital camera (42%) and jewellery (38%) are also items festival goers can’t live without. Whilst the results showed that young people are exercising good sense by only taking approximately three items of high value, the average total cost of possessions still amounts to £817.

Over a fifth (22%) of students will be going to a music festival while hundreds more young people will decide to go at the last minute. The survey results show that young people like to attend both commercial (73%) and independent (63%) music events and many will go to more than one.

Leeds and Reading festival come out on top for students with a quarter (24%) of those planning on going to a mainstream festival attending one of the Festival Republic events. V and Glastonbury also remain popular; 23% will be going to either Chelmsford or Staffordshire and 20% enjoyed Somerset last weekend. In comparison, around 6% of students’ will head to Latitude – in Suffolk in July.

There are a wide variety of independent, boutique festivals on offer over the summer and students are making the most of them. The favourites are the Green Man (7%) and Camp Bestival (7%), followed by Beach Break Live (2%), Sonisphere (1%), Wireless (1%) and Bestival (1%).

To help students and those that are young at heart decide which music event to go to and how best to prepare for it, Endsleigh has launched a survival guide website, Guidefest. The new site, which is designed by students for students, includes an events calendar with information on all the commercial and independent music festivals happening across the UK, tips and advice on what to pack and wear, and information on how to stay safe whilst making the most out of the experience.

Vicki O’Connell, Communications Manager, Endsleigh Insurance said,

“It is great to see so many students embracing the different types of music festival over the summer. In recent years we have seen festivals diversify greatly; there are now hundreds of different types of event, both commercial and independent, that offer a lot more than just music. However with variety comes difficult choices, and when students spend so much time at University, it’s important they make the most of their free time. Our new survival guide website hopes to help them  find the right festival, and plan what to do and how to do it when they are there.

However, it’s important to remember that with any festival, big or small, there is a risk of loss or theft. Although students will be travelling light, it all adds up, and their festival necessities will be expensive to replace. Therefore it’s important for festival goers to be just aware of their personal safety as they are line up.”

Source : Endsleigh

 

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Graduate debt is crippling graduates in their lives, asking them up to 11 years on average to clear. Research from uSwitch.com shows 56 per cent are unable to save and other big life decisions such as marriage and children are also being put off.

Today’s graduates face a future blighted by student debt and poor job prospects, according to new research from uSwitch.com, the independent price comparison and switching service.  Graduates now take 11 years on average to clear their student debts, but the true cost of going to university is even greater as nearly four in ten have been forced to put their life on hold because of debt.

Almost six in ten recent graduates (56%) have had to wait to start saving as a result of their student debt, while nearly half (48%) have put off buying a home. A third (33%) couldn’t afford to start a pension when they wanted to. And graduates are taking longer to achieve other life milestones because of the financial burden of university – one in three (30%) have put off starting a family, while over a quarter (29%) have put marriage plans on hold. Of those who have been forced to put life plans on hold, three in ten (29%) had to postpone their plans to start a family by at least 5 years while over a quarter (27%) put off getting by married by the same amount of time.

However, it is not that surprising that student debt is having such a huge impact on life after university – over two thirds of university leavers (68%) underestimated the amount of money they would owe after finishing their degree. And things don’t get any better after graduation. Faced with entering a job market with few prospects, the dream of walking straight into a job after graduation is no longer a reality – a quarter (25%) of graduates are unable to find even an entry level position to start their careers.

Hindered by the current state of the job market, the average graduate still has over £1,200 in overdraft as a hangover from their student days. Those that graduated between three and five years ago are still struggling to clear their overdraft of over £1,300. And when it comes to addressing the true level of their debt graduates may be burying their heads in the sand – almost a quarter (24%) have no idea how much they actually owe. Things are so bleak that one in five (21%) are contemplating bankruptcy as a solution to their debt problems.

And the future doesn’t look bright. Instead, a perfect storm is brewing along with bleak job prospects and increasing fees, students are uneducated about the real costs of university. More than three quarters of graduates (77%) don’t think enough is being done to inform students on debt, budgeting and finance. Despite the fact that almost nine in ten (86%) graduates took out a student loan one in five (19%) wrongly believe that student loans are interest free and a further fifth (21%) have absolutely no idea how student loans are calculated or paid back.

Michael Ossei, personal finance expert at uSwitch.com, says: “The fact that graduates have to put their life on hold because they are knee deep in student debt is a sorry state of affairs. And as fees go up, students risk running up even bigger debts. But without a degree getting a job in today’s stagnant market may be even harder. Going to university used to be the norm, but it is now becoming a catch 22.

“It is also worrying that students are going to university blind to the financial implications. Higher fees and lack of job prospects may be out of your control, but if university is right for you it’s more important than ever that you are as financially prepared as possible. Getting a student loan may be the only way to fund university, but it’s vital that you get clued up on the system. And when you graduate make sure you understand where you stand financially and how to avoid falling further into debt.”

Source : uSwitch.com

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Stephane Taponier et Herve Ghesquiere, the two  French journalists freed Wednesday in Afghanistan are “surprisingly well, both  physically and mentally”, a French embassy official told AFP from Kabul.

Cameraman Taponier and reporter Ghesquiere, working for France 3 public  television, were seized with three other Afghan colleagues by the Taliban in  December 2009 in the mountainous and unstable Kapisa province, east of Kabul.

They were “found somewhere in Kapisa province, which they never left since  their capture,” the official told AFP by telephone.

“They were then taken from the Tagab (French military) base to the French   embassy in Kabul, where the ambassador is now with them,” he said, adding that  the pair were expected to leave Kabul “as soon as possible”.    Ghesquiere’s girlfriend told AFP they were expected to arrive on an  overnight flight to Paris at 8am (0600 GMT) on Thursday.

Kabul, June 29, 2011 (AFP)

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Gocompare.com provides new research showing personal injury firms have contacted 1 in 5 British motorists. They have done so either by text, phone or mail suggesting that they could pursue damage claims for injuries caused in an accident.

This research reveals that 11 per cent would consider contacting a ‘no win- no fee’ service to claim compensation even if they were not that badly injured. Of the respondents 3 per cent admit to having contacted a personal injury firm for compensation even though the injuries were not that bad.

Key findings of the research include:

– 21% of drivers have been approached by personal injury lawyers

– 3% have used no win-no fee lawyers to get compensation for minor injuries

– 33% feel that personal injury lawyers are pushing up the cost of insurance

– 11% of drivers would consider making a claim after a minor accident

– 52% feel that the UK is developing a ‘blame and claim’ culture

– 47% feel that people who are genuinely injured are entitled to compensation

– 13% feel that personal injury lawyers provide a useful service

A majority of British motorists feel that the UK is developing a ‘blame and claim’ culture. Only 13 per cent believe in the usefulness of services provided by personal injury lawyers.

However, 47 per cent of respondents feel that if someone was genuinely injured in a road accident they should be entitled to compensation.

Just over 1 per cent of respondents say that they have been badly injured in an accident and the compensation they received was invaluable in helping them to carry on their previous lifestyle.

Lee Griffin, Gocompare.com’s chief operating officer, commented, “Personal injury claims are a major factor of insurance premium inflation. Our research shows that millions of drivers have been contacted by personal injury firms encouraging them to make injury claims following minor accidents. If everyone took up their offers the effect on the insurance industry and legal system would be catastrophic with the costs undoubtedly passed on to drivers in the shape of huge insurance premium rises. Whilst it is perfectly reasonable for someone with a genuine claim to receive compensation for injuries sustained in an accident, it is time to put a stop to the UK’s growing ‘blame and claim’ culture before it gets out of control. The only people who will ultimately benefit from this ambulance chasing are the personal injury lawyers themselves.”

Source : Gocompare.com

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Russian insurer OJSC Sogaz’s long term counterparty credit and financial strength rating has been raised to investment grade ‘BBB-‘ up from ‘BB+’ by Standard and Poor’s. The outlook is stable. At the same time, the Russian national scale rating was affirmed at ‘ruAA+’.

The upgrade reflects on-going improvements in Sogaz’s capitalization and our view of Sogaz’s improved competitive position in Russia.

The ratings reflect Sogaz’s good competitive position and adequate capitalization. The ratings also reflect the on-going support and our assessment of probability of extraordinary support for Sogaz from OAO Gazprom (BBB/Stable/A-2), the world’s largest natural gas company, with which Sogaz has strong ties.

These positive factors are offset by the relatively high credit risk in Sogaz’s investment portfolio, Sogaz’s expansionary policy to acquire noncore assets, and the high industry risk associated with operating in the Russian insurance market.

The stable outlook reflects our expectation that Sogaz will continue its strong relationship with Gazprom and its good operating performance. We expect Sogaz to achieve and maintain at least good risk-based capital and preserve at least a marginal investment portfolio quality. In our view, Sogaz’s insurance portfolio diversity will improve, but Gazprom will remain its largest client.

A positive rating action could result if the quality of the company’s investments improves significantly, and our assessment of its exposure arising from industry and county risk lessens, all other factors being equal.

Conversely, any significant and sustained deterioration in earnings, capitalization, or the quality of the company’s investment portfolio could lead to a negative rating action. Negative rating actions could also follow if we perceive a diminution of Gazprom support.

Source : Standard&Poor’s

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Aon Benfield has released new findings that show 60% of European insurers attending its recent International Analytics conference think 2014 would be a better starting date for Solvency II. By contrast, 31% of the delegates did not want to see the starting date delayed and are working towards the January 1, 2013 deadline. The remaining 9% thought “maybe” the regime should be delayed.

Aon Benfield is delivering its Solvency II technology and services, including ReMetricaR – an innovative platform for Solvency II internal models – to ensure all clients are prepared for the final rules if the regime is to take effect in 2013.

There could be potential delays to the current timetable as Omnibus II, which modifies the original directive of Solvency II (April 2009), must firstly be passed into legislation before the European Commission can formally adopt the regime’s implementing measures (“Level 2”) and implementing guidance. (“Level 3”). All of these components have to be passed into legislation following the required consultation periods, ahead of Solvency II’s inception.

Meanwhile, insurers are eagerly awaiting guidance on how the Solvency II regime will take shape following their completion of the QIS5 assessment. They are considering different options including the value of an approved internal model and how to juggle the additional resources needed to implement the regulation. Furthermore, the survey also found that insurers have concerns about the level of understanding of their local regulator. The results showed:

– 61% of European insurers polled think their regulator is not up to speed with internal models

– 54% of European insurers polled think their regulator is not up to speed with underwriting risks, in particular catastrophe risk

To ensure the industry is prepared, Aon Benfield is working with insurers to:

  1. Develop their Solvency II strategy for key risks, such as market risk and non-life catastrophe risk
  2. Maintain regular contact with their local regulator to understand and comply with their approach
  3. Optimise the reinsurance programme and in particular support the increase in appetite for aggregate covers
  4. Use enterprise risk management (ERM) expertise to ensure compliance with Pillar 2 and 3
  5. Create internal capital models using ReMetrica and Impact Forecasting, Aon Benfield’s catastrophe model development centre of excellence, for catastrophe risk.

Marc Beckers, head of Aon Benfield Analytics in Europe, Middle East and Africa, said: “Insurers are juggling a plethora of pressures to comply with Solvency II. We are helping clients to prioritise their efforts by concentrating on the areas that really impact their capital charge. For example, the Cat Task Force has been forced to review the standard formula for non-life catastrophe risks as the results were deemed too volatile. However we have little hope for fundamental change before the start of Solvency II.”

Gareth Haslip, head of Aon Benfield’s Risk & Capital Strategy team in Europe, Middle East and Africa, added: “Insurers need to take strategic decisions and be prepared to change their business model in order to be ready in time. By meeting the 2013 deadline, companies that have a good grasp of Solvency II will have more time to focus on how best to operate their business for the benefit of their shareholders in this new environment. Being prepared will also bring a competitive advantage.”

Source : Aon Benfield

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2010 financial results were positive again for AXA Assistance with a significant growth of net operating profits. The assistance company is undergoing a transformation strategy, where they intend to increase their presence in emerging markets.

AXA Assistance has recorded a 5.2 per cent rise in 2010’s turnover to 929 million EUR (882.8 million EUR in 2009).  The net results have increased significantly from 12.6 million EUR in 2009 to 20 million EUR in 2010. This increase is the result of a “portfolio cleansing” and a lower effect of currency trading compared to the precedent year.

The AXA Assistance travel activity represents 24.8 per cent of the total results, progressing from 19.8 per cent in 2009, while the automobile activity has lowered (36.3 per cent in 2010 against 41.5 per cent in 2009). Finally, sales of home activity have increased, representing 22.3 per cent of total sales of the brand.

A new organisation

“Our strategy is clear and consistent with that of the AXA Group. We want to expand in emerging markets and seek profitability in mature markets, “said Serge Morelli, CEO of AXA Assistance. Present in 31 countries, the company now organises its activities in five areas (instead of 8 previously) and records a good performance in France (turnover of 222 million euros) and Asia Pacific. Emerging markets now account for 17% of sales.

Throughout its differnet business lines, AXA Assistance is aiming to operate an evolution of its model. “The world is changing,” said Serge Morelli, “on one hand, customers have different expectations and on the other hand this has an impact on our offers,” he sais. Thus, the company concentrates on innovation (700,000 euro budget last year) and a greater  process automation. “Our customers demand services with high added value but with low cost,” said Serge Morelli. “The goal is to gain in competitiveness in order to win the business”.

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French banks and insurance companies will  participate in a new Greek financial rescue programme “on a voluntary basis”,  French President Nicolas Sarkozy said Friday.

“The answer is yes, but it’s not only the banks but insurance companies and  that was part of negotiations engaged with Angela Merkel,” Sarkozy said at a  Brussels press conference responding to a reporter’s question.

“We’ve had a lot of meetings with French banks and insurance companies. And  I can tell you that we know of meetings taking place in eurozone countries  with equivalent organisations and I can tell you there is no problem and  nothing to fear,” he said.

“On how this is done, we’ll communicate at the right moment, but there is a  willingness to save the euro, to maintain solidarity in the eurozone, which is  extremely strong,” the president said.

There has been a major push to have holders of Greek debt to participate in  a second bailout of Greece that is currently being negotiated, which would  potentially give the country a breathing space of several years worth tens of  billions of euros.

France is the country most exposed to Greek sovereign debt, mostly held by  private institutions.

In the banking sector, BNP Paribas holds five billion euros in Greek debt,  Societe Generale holds 2.5 billion euros and Credit Agricole holds 600 million  euros.

Insurance group AXA is exposed to 300 million euros and CNP Assurances 127  million euros.

How that participation of bond holders is structured in the bailout is  essential as it risks causing a determination of a credit event and a default  rating by ratings agencies.

That would roil the markets and the ECB has said it would no longer be able  to accept Greek bonds as collateral on loans, which would cut Greek banks off  from the credit that has kept them operating.

ECB chief economist Juergen Stark warned that including the private sector  in the Greek rescue package injects added risk to an already volatile  situation.     “The involvement of private creditors (…) could lead to a risky situation  if things are not clarified soon,” Jurgen Stark told the Allgemeine Zeitung in  an interview to appear Saturday.

Stark said he understood the desire of European governments to involve the  private sector in a new rescue plan, but “the question is if it is  economically suitable and necessary.”

He warned that if there were a change in the terms of the debt in a  rollover of Greece’s debt that credit agencies would call it a credit event  and a default.    Such a scenario “would be a new dramatic phase in the crisis, with very  negative consequences that would be dreadful for the Greek banking system, for  the economy and also for other countries.”

Brusells, June 24, 2011 (AFP)

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